‘Amazon effect’ appears to be stalling retail development and deals in Louisiana

The north Shreveport business community learned this week that a major industrial development can create a drag on retail growth if property owners of commercial real estate overprice their listings because of proximity to the site.Bill Sabo, Shreveport’s director of economic development, calls the condition the “Amazon effect.”
“Everybody thinks their land is worth three times what it is and that is stagnating a lot of business opportunities here,” he said during a presentation to the North Shreveport Business Association.
He cited an example where a major convenience store company recently pulled out of a deal because the price of land made the development cost-prohibitive.
In 2024, Amazon opened a 3-million-square-foot facility on Corporate Drive in north Shreveport. The company says the facility is one of its largest and most advanced fulfillment centers “packed with robotics, AI systems and mobile robots.”
The center is designed to employ about 2,500 workers when fully staffed, according to Amazon.
Sabo’s analysis is drawn from the work of city consultant Retail Strategies and research stemming from the experiences of multiple municipalities across the country.
The arrival of a major Amazon development changes landowner expectations, which causes banks to say no and developers to move on, the research indicates.
“I’ve seen almost every place that has an Amazon center go through this,” Sabo said.
In north Shreveport, there are approximately 34 properties in proximity available for sale, with two listed as pending.
The costliest land tract is listed at $1.5 million an acre and the least expensive building is a metal warehouse listed for $145,000. Most listings fall between $150,000 and $700,000, according to the Louisiana Commercial Database.
Grant Smith, a commercial real estate agent with Sealy Real Estate Services, said he hasn’t seen an impact on rented or occupied building space, but he noted that the commercial market is slow to react.
“I do believe that Shreveport is in a growth phase, but that’s not going to happen overnight,” Smith said. “I am very optimistic about the future. The coming decade will be a prosperous one for northwest Louisiana.”
The story people choose to tell about Shreveport matters in economic development, Sabo said to the business community.
“Because investors, retailers, developers, employers and even our young people are listening to how we talk about ourselves,” he said. “If the only story we tell is what is wrong, then we should not be surprised when others believe us.”
The data shows that north Shreveport is a strong retail market and regional commercial destination, and it has a business community that cares deeply about this part of the city, Sabo said.

Read Full Article: https://justthenews.com/nation/states/center-square/amazon-effect-may-be-stalling-retail-development-and-deals?utm_source=justthenews.com&utm_medium=feed&utm_campaign=external-news-aggregators