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Ross Stores Signs Distribution Center Lease to Support Expansion

Fast-Growing Retailer Plans to Use 1 Million Square Feet of Warehouse Space for Western U.S. Stores
September 5, 2018
Ross Stores Inc. is leasing this building at 4100 Express Ave. at Wonderful Industrial Park in Shafter, California.

Fast-growing discount retailer Ross Stores Inc. has signed a lease for 1 million square feet of industrial space in Southern California to support its ambitious growth plans, the landlord said.

The deal follows an announcement from the Dublin, California-based retailer this month that it plans to open 100 stores a year for the next several years.

The lease is an expansion for Ross, which already owns and operates a 1.7 million-square-foot warehouse at Wonderful Industrial Park in the small city of Shafter, 18 miles northwest of Bakersfield, according to landlord The Wonderful Company.

Ross, one of the few retailers that offers consumers no e-commerce options, will use the new warehouse to ship goods to its rapidly expanding network of stores in the western U.S., said a spokesman for the industrial park.

Though it doesn’t need warehouses for online sales, Ross – like other discount retailers – buys oversupply from designers and department stores and must constantly replenish its inventory with a flow of new merchandise.

It needs quick, last-mile delivery options to efficiently reach that goal, said Matt Hammond, a partner and senior vice president at retail brokerage Coreland Companies in Orange County, California.

"It's not like a Dick's Sporting Goods, where inventory is established for a set amount of time," Hammond said. "They need to restock shelves rather quickly."

The park is located within 300 miles of 14 percent of the U.S. population and provides companies the opportunity for same-day delivery to 30,000 Californians. Ross operates 388 Ross Dress For Less and dd’s Discounts stores in California, making the state the company's largest market.

Wonderful Industrial Park is a few hours' drive from the ports of Long Beach and Los Angeles, two of the largest in the U.S. Ross and other companies utilize warehouses at the park to import goods in shipping containers directly from Asian markets, principally China, that enter the U.S. before shipping items to stores in the western U.S., the spokesman said.

Other tenants in the park include Target Corp., which occupies 1.8 million square feet, and American Tire Distributors Holdings Inc., which has 1.1 million square feet there.

Ross operates 1,680 stores in 38 states. Company executives said this month that they were aiming to open 3,000 stores at a pace of 100 a year. The company also operates six distribution warehouses: Three are in California, two are in South Carolina and one is in Pennsylvania, according to its website.

Rob Smith, National Retail Reporter  CoStar Group   
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