Amazon Leases 237,000-Square-Foot Warehouse Facility In Skokie

SKOKIE, IL — Amazon last week closed a lease for a warehouse facility in Skokie in one of the largest pieces of commercial real estate along the Edens Expressway so far this year. The Amazon Logistics delivery station will occupy the nearly 370,000-square-foot facility on more than 15 acres at 3609-3639 Howard Street. It has begun posting job openings for workers and working to secure access to hundreds of required off-site parking spaces in the village before opening in the next several months.

According to a statement from Amazon acknowledging the deal Tuesday, the facility will "power Amazon's last-mile delivery capabilities to speed up deliveries" in the area. A company spokesperson said hundreds of mostly part-time workers would staff the facility and it would compare in scope to other delivery stations in Illinois. The spokesperson did not provide any further specifics about the number of jobs in Skokie. According to its website, the company currently employs 11,000 people statewide.

The recently completed Skokie Commerce Center is located on the site of the former Ohmite Manufacturing facility built by Hillwood Investment Properties, a Dallas-based industrial real estate developer chaired by Ross Perot Jr. According to its website, Hillwood has developed or purchased more than 182 million square feet of property across North America and Europe. It broke ground in September 2017 on the Skokie building, which includes 1,900 square feet of office space and has a Cook County 6b property tax exemption that will remain in place for a dozen years.

Amazon has been growing its fulfillment sector in the past year as it spends an ever-greater share of the revenue to deliver the things it sells. During its peak delivery season at the end of the year, it aims to handle about 45 percent of its own volume, according to a report from research firm Digital Commerce 360.

As of August, Amazon had more than 155 million square feet of warehouse space nationwide and planned to add 30 million more, including 37 more fulfillment centers. In Illinois, the Skokie site will be added to the six delivery stations with almost 650,000 square feet of space and nine fulfillment centers with over 5.6 million square feet of space Amazon currently operates, according to data included in the the report from supply chain consultant MWPVL International.

The Amazon Logistics division, formed last year, plans to soon expand its fleet of aircraft from 43 to 50, the report found. Earlier this year the company announced efforts further outsource its delivery by offering incentives to its employees to quit and launch their own businesses to grow its delivery network without paying for more workers or vehicles.

A village spokesperson did not respond to a request for a statement from a village representative Wednesday morning. However, the Amazon spokesperson included a quote from Mayor George Van Dusen welcoming the facility.

"[W]e are most excited for the job opportunities the new operations presents to the community," Van Dusen said. "Further, Amazon often sources products from local merchants, and we are hopeful that the new facility also will result in growth for the Village's business community. Amazon's presence in Skokie adds welcome new diversity to the Village's economic base."

A nearly identical statement posted to the village website Wednesday evening quoted Van Dusen as saying the facility would bring an "estimated 600 full- and part-time job opportunities." It said the property had an "abundance of environmental issues" before the Texas-based developers carried out a full site remediation and built the facility on speculation.

Amazon has been undergoing a "vendor purge" to cut wholesale relationships with smaller retailers that sell directly to it, likely to drive the merchants to reach consumers through the Amazon marketplace — and give the company commissions, which are usually 15 percent, according to the Digital Commerce report.

Skokie village planning officials noted in an staff report ahead of the Aug. 1 Skokie Plan Commission meeting that Amazon had submitted a building permit to expand the number of parking spaces. The commission approved the staff recommendation to require 1,100 parking spaces before the village provides a certificate of occupancy, which can be a mix of on-site and off-site, although members acknowledged it would difficult to monitor.

Greg Scovitch, Hillwood's vice president of development, told plan commissioners that during most of the year the facility would operate at about 60 percent of capacity. He said the Amazon operation would have no interactions with the adjacent Fed Ex shipping facility. Scovitch said he was working with village staff and the Metropolitan Water Reclamation District to explore possibly burying stormwater detention on the site to make room for more on-site parking as well.

"Because of the fluid nature and because of the ever-changing season and demand on packages," Scovitch said Amazon would be interested in reducing the amount of needed parking "as the operation evolves and it is determined that the parking determination may have been excessive."

According to a memo to Scovitch from a parking consultant, the facility will include 150 to 200 overnight employees who will sort deliveries and 10 to 115 employees who will remain at the facility throughout the day to manage loading, unloading and dispatching delivery vehicles as they come and go from the site.

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Amazon begun posting job listings at the Howard Street facility after it had been taken off the market but declined to answer inquiries from Real Deal Chicago, the real estate news site reported Wednesday. A report from CoStar later "exclusively" confirmed the company was the client announced before the plan commission meeting the month before.

Last month, Amazon made headlines amid renewed focus on its "Ambassador" program, which it began last August to counteract coverage it found unfavorable regarding working conditions at the company.

I suffer from depression too, and at one point I wanted to quit Amazon. But I realized it was my fault for the problems I was dealing with, and not Amazon's. I'm allowed to talk to people, but sometimes I don't want to. Now I have some great coworkers to pass the nights with.
— Hannah - Amazon FC Ambassador (@AmazonFCHannah) August 15, 2019

"It's important that we do a good job educating people about the actual environment inside our fulfillment centers," Amazon said in identical statements provided to TechCrunch when it reported on the program last year and to the New York Times and Buzzfeed News last month. The company declined to specify how many ambassadors it employs or how the jobs work to the Times, which noted the Ambassador social media accounts have also been used to communicate anti-union talking points.

• Related: Warehouse Workers Say Amazon Jobs Are 'Unsafe, Grueling'

The Skokie facility is expected to open sometime this fall, according to an Amazon spokesperson. However, it will not be operating at peak capacity this year and plans to return to the plan commission Oct. 3 to request a reduction in the number of required parking spaces, according to a village spokesperson. The company is holding a Sept. 17 hiring event in Chicago as it staffs up on seasonal employees ahead of its peak season. Amazon is filling more than 30,000 full and part-time jobs around the country, according to its website.