Huge Quantities, Diverse Products Flow through Region
YOUNGSTOWN, Ohio – Were you to take an aerial snapshot of the Mahoning Valley, you’d see a vast network of highways and rail lines curling around large, sprawling distribution hubs that are alive with activity.
Tractor-trailers ease off the main arteries and into distribution centers in places such as North Jackson and Lordstown with little or no traffic congestion. Soon after, they leave with their cargo, off for their next destination. At other sites, rail cars packed with materials unload or load their supplies, then chug on to markets across the country.
The quantity and variety of products flowing in and out of the area is enormous. This region holds its own as a nexus for warehousing, transportation, and distribution in northeastern Ohio. Everything from steel to french fries is hauled through the region, supplying manufacturers, construction companies, hospitals, schools, retail stores and small businesses of every kind.
Lordstown is quickly emerging as one of the busier distribution nodes in the region. Over the past five years, millions of dollars have been spent on upgrades at the Ohio Commerce Center along state Route 45, while just south of that site lies another area that developers want to turn into a massive supply and distribution center.
“We’re a hot spot,” says Lordstown Mayor Arno Hill. “We have the utilities. We have the roads. We have rail. And we have incentive programs.”
On Route 45 in Lordstown, 173.5 acres once owned by General Motors is in the hands of a private company, NorthPoint Development of Kansas City. NorthPoint is looking to convert the vacant land into a business park that would become a distribution center for the automotive and other industries.
Should the project move forward, Hill says, the developer has plans to build an 830,000-square-foot distribution complex there.
“They’ve pretty much cleared the land, and we’re waiting to hear back from them,” the mayor says.
Hill says that the proximity of a major manufacturer – in this case, General Motors Co.’s Lordstown complex – proved the deciding factor in attracting the developer to the Mahoning Valley. “Companies like to look for roads, infrastructure, utilities – and something that makes an impression,” he remarks.
The key is to recognize the assets of an area and market it aggressively, says George Bakeris who, with his brother Spiro, own the Ohio Commerce Center in Lordstown. The site possessed important rail access that was undervalued and for a long time neglected, say the brothers, who purchased the industrial park five years ago.
“We bought this place for the rail,” George Bakeris says. “We’ve always felt that rail has been the biggest asset here. It’s a lot cheaper to move freight by rail than by trucks.”
Since then, the Bakeris brothers have put about $5 million into upgrading the Commerce Center’s roadways, sewer and water services, railroad tracks and buildings. The eight original buildings hold a combined 1.5 million square feet, while a 12,000-foot loop track was installed less than two years ago to accommodate transloading operations from rail.
Meanwhile, additional track upgrades were made at the southern end of the park, which could someday link to Norfolk Southern’s main line, Bakeris says. “We’re already on CSX, and we’re in discussions with Norfolk Southern,” he says.
It was rail access that helped to land two major tenants at the park in five years.
In 2012, Anderson DuBose Inc. constructed a major distribution center near the entrance of the center. The company is a major supplier to restaurant chains, most notably, McDonald’s. And, Matalco Inc. recently began construction of a $125 million plant that re-melts aluminum billets shipped in by rail and ship out finished ingots via rail.
”Once you get a big anchor in, people follow,”George Bakeris says. “There’s about $150 million worth of new development in the front.”
Should a pending deal at the Commerce Center move forward, the complex would be about 80% full, reports Dan Crouse, a broker for Routh Hurlbert Co., the leasing agent for the Commerce Center. “I’d say this was 20% full five years ago,” he adds.
Today, materials such as stone, sand, lumber, automotive parts, french fries and even tomato sauce pass through the Commerce Center.
About 80 acres of green space at the park is earmarked for companies that supply and serve the railroad industry, adds Spiro Bakeris: “That’s who we’re focusing on.”
George Bakeris believes there’s enough demand in the rail business to attract companies related to service and supply.
“We think it’s pretty good. You have to go seek them out,” he says. “But, they kind of seek us out, too, since we have at least one connection to a main line.”
Rail traffic is bound to increase, Crouse believes, because the Panama Canal will complete a major expansion next year that will allow larger ships once limited to ports along the West Coast to use the canal and dock in East Coast harbors such as Baltimore.
“This track out here is a direct shot to Baltimore and Chicago,” he says. “This is one of the few sites along the way that can handle and unload a unit train without fouling the track.”
Economic development specialists have long touted the Mahoning Valley’s location as its greatest asset – halfway between New York and Chicago, and halfway between Cleveland and Pittsburgh.
Clusters of warehouse and distribution operations are congregated close to major interstates.
In North Jackson, Macy’s and Things Remembered operate large distribution centers along Bailey Road, just south of Interstate 76. Victoria Road in Austintown has also been a center for warehousing and distribution because it’s close to state Route 11. Recently, Giant Eagle closed its Tamco warehouse there, leaving a large building on the market for an end-user.
And in Youngstown, the empty Toys R Us center on Salt Springs Road is gaining some attention, reports Sharon Woodberry, director of economic development for the city. “There have been conversations going on for several months,” she reports. “I understand someone wants to use it for another distribution and warehousing operation.”
Woodberry says the prospective occupant would use the entire 442,000 square feet of the building.
“There are many existing sites that are ideal” for warehousing operations, emphasizes Sarah Boyarko, vice president for economic development at the Youngstown Warren Regional Chamber.
Most warehousing and distribution companies are looking for sites that have excellent highway access and mainline rail access, she says. However, they also want a site near their customers, manufacturers, and that can draw from a well-trained workforce.
“These are always high on their list,” Boyarko says.
The warehousing and distribution industry is one of the region’s largest employers. According to the U.S. Bureau of Labor Statistics, 8,900 in the Mahoning Valley were employed in the transportation, warehousing and distribution sector as of June.
While the network of highways and railroads is important, an existing manufacturing base is equally important in maintaining a vibrant transportation and distribution economy.
“Our biggest advantage is our customer base,” says Bill Strimbu, president of Nick Strimbu Inc., Brookfield. The company is an over-the-road trucking service that hauls cargo within an 800-mile radius of the Mahoning Valley.
“From this area, we have flatbed, specialized and refrigerated trucks,” Strimbu says. “There’s a lot of manufacturing in this area and that’s what’s helped us survive. There’s still a lot being produced here.”
Strimbu says that the downturn in the oil and gas market has affected the flatbed business since most of the pipe and tube manufacturers are struggling. On the other hand, the refrigerated-foods business is steady.
“We’ve been in the refrigerated business about 10 years, “ he says. “We’re dealing with food products and supplying different grocery chains.”
The company maintains a fleet of 100 trucks, Strimbu says. “As a small company, we’ve invested a lot in new technology,” he continues. New GPS units, for example, are installed in all Strimbu trucks.
“We message our drivers through all our GPS units, dispatch through the GPS, and run diagnostics through the GPS,” he says. “Sometimes we can tell that there’s a problem before the driver does.”
Other new technological accessories include tracking modules, accident event recorders, and alternative power units, which can or heat or cool the cab of a truck without it idling.
“We use this technology to help drive our business,” Strimbu says. “It opens the door for us.”
Pictured: Spiro Bakeris and George Bakeris, co-owners of the Ohio Commerce Center.
Copyright 2022 The Business Journal, Youngstown, Ohio.