CSX envisions large rail center in Winter Haven

Tampa Bay Business Journal
June 23, 2006
by Tony Quesada
Special to the Business Journal

WINTER HAVEN -- CSX Corp. plans to buy 1,250 acres for an integrated logistics center that would bring together an intermodal terminal and an automotive rail yard with warehousing and distribution operations.

At full build-out, the center is to include 3 million square feet of warehouse space, 1.5 million square feet of industrial sites and 500,000 square feet of office space. It's projected to create 8,500 full-time jobs in the area with an annual payroll of $282.2 million, according to an analysis by HDR/HLB Decision Economics Inc.

Modeled after a handful of such centers in the country, it would be the first of its kind in the Southeast. Jacksonville-based CSX (NYSE: CSX) cites Florida's rising population and demand for consumer goods, much of which is shipped in containers by truck, as the driving factors behind its plan.

"This will be principally a landing spot for intermodal and automotive traffic," said Rick Hood, assistant VP of real estate sales for CSX. "If we're going to alleviate congestion and get sufficient volume into the state that's being demanded, this is the kind of facility that becomes necessary."

Union Pacific Railroad made a similar conclusion when it decided to open Global III, a 1,200-acre integrated logistics center in Rochelle, Ill. So far the three-year-old center has met expectations, said James Barnes, a Union Pacific spokesman.

"It gives our company capacity to expedite operations for current shipments and keep up with projected growth," he said. "It has done what we wanted in terms of being able to consolidate capacity in a high-traffic area."

The trains that will bring goods to the Central Florida center will leave from a northern CSX yard, such as in Chicago, and have no stops in between, Hood said.

The Winter Haven City Commission approved an agreement to sell the land to CSX for $21.8 million, and the company expects to close on the property around the fourth quarter of 2007.

The company is performing due diligence, Hood said, adding that "we feel fairly confident there aren't any show-stoppers." The company is pursuing permitting and working on design simultaneously so it can start construction immediately after closing.

The project will be carried out in two phases. In the first one, CSX will build automotive and intermodal rail terminals on about 300 acres, providing the anchor of the center. The company expects to start construction on the terminals in early 2008 and begin operations in late 2008 or early 2009.

The second phase will include warehousing, distribution and other industrial operations on the remaining acreage. Hood said CSX hasn't decided on whether to master-plan that part of the center and sell the individual parcels to be developed according to the plan or enter into a joint venture.

In any event, CSX likely would not operate the other buildings, he said.

It's too soon to estimate the project's cost, Hood said, although comparable centers have run in the $100 million-plus range.

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