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UPS plans US$110m expansion at Anchorage airport

PACKAGE delivery giant UPS has confirmed it's planning a potential US$110 million expansion at Ted Stevens Anchorage International Airport, the latest in a surge of proposals for new warehouse and cargo space at the airport

11 December 2019 - 19:00

PACKAGE delivery giant UPS has confirmed it's planning a potential US$110 million expansion at Ted Stevens Anchorage International Airport, the latest in a surge of proposals for new warehouse and cargo space at the airport.

The plan is one of five new projects announced in recent months by the airport, some of them larger than UPS's proposal. Totalling about $700 million in investment, the proposals would boost Anchorage's economy if they advance to the construction phase, officials said, reports Anchorage Daily News.



Louisville, Kentucky-based UPS is looking to lease an additional 1.35 million square feet of land at the north side of the airport - enough to fit more than 20 football fields. The expansion in part will support UPS's growing fleet of Boeing 747-8 jumbo jets, UPS company spokesman Mike Mangeot said.



It would greatly increase the company's current footprint at the airport. A new 190,000-square-foot operations building would more than double the size of UPS's existing facility, municipal property records show.



The proposed expansion would 'accommodate future growth and efficiency' for UPS, Mr Mangeot said in an email, adding that Anchorage is the gateway to Asia and a vital point in UPS's global air network.



The state announced UPS's plans shortly before Thanksgiving. They include employee parking, parking for the 747-8 jets - the largest aircraft UPS flies - and other facilities. The company hopes to break ground in May 2020 and complete the project in 2022, according to paperwork filed with the state.



'While the public filing shows the potential for $110 million in structures, UPS has not finalised plans for the parcel (of land),' Mr Mangeot said.



Alaska CargoPort, a real estate development company that developed a cargo transfer facility at the airport in 2000, has applied to lease the land on UPS's behalf. The company's founder Ray Brimble said Anchorage International has performed well in recent years compared to other North American airports, in terms of tonnes of freight moving through. The airport is the fifth-busiest air cargo hub in the world.



Bill Popp, president of Anchorage Economic Development Corp, said the airport and the development corporation have been marketing the airport's advantages to companies. Anchorage is one of the world's few airports where foreign cargo can be transferred between aircraft without being subject to customs and other trade requirements. That saves shippers time and money.



'There is always an ongoing race in the air cargo industry to figure out ways to do things less expensively,' Mr Popp said. 'So, it's a constant competition to see who can deliver product on time at a lower cost.'



Other proposed projects at the airport include shipping giant FedEx's proposal to build a 98,000-square-foot domestic operations centre, part of a $57 million project, which the state announced in August. FedEx can then increase international shipments at existing facilities.



6A-XL Aviation Alaska, owned by Maryland-based company 6A Aviation Inc, has proposed two projects at $170 million each. They include one new cargo warehouse at 500,000 square feet and a second warehouse at 300,000 square feet.



Alaska Cargo and Cold Storage, backed by Anchorage firm McKinley Capital Management, is proposing a 700,000-square-foot cold storage and general warehouse space, a $200 million project. That could facilitate shipments of Alaska seafood and peonies, as well as fruits and vegetables from South America and California to Asia.



The five projects could add up to 1,500 jobs after construction, said airport manager Jim Szczesniak. The airport is currently negotiating leases with the companies, he said, adding that each of them would like to start preparing land for construction this summer, he said. 'Hopefully all these projects succeed.'


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