KANSAS CITY—An underground mine may seem like an unusual place to set up a business, but FoodServiceWarehouse.com, an e-commerce company that provides foodservice equipment and supplies, has just signed a ten-year lease to occupy 475,200-square-feet of warehousing and distribution space in Kansas City's Hunt Midwest SubTropolis, which the developer bills as the world's largest underground business complex. FSW can now take advantage of mine's naturally occurring year-round temperature of between 65 and 70 degrees Fahrenheit and severely curtail its energy costs. FSW also has the option to expand to 792,000-square-feet over the next four years.
“An internal analysis revealed Kansas City as the most economical and efficient location for our central fulfillment center,” says Madhu Natarajan, chief executive officer of FSW. “When we toured SubTropolis, we immediately saw the opportunity it held for our company. The logistics alone are impressive, but the potential to grow our footprint within the underground and the access to high-speed connectivity helped us make our final decision to move here.”
Hunt Midwest, a Kansas City-based, privately held company developed SubTropolis, which was created through the mining of a 270-million-year-old limestone deposit. The mining process left 25-foot square pillars that are on 65-foot centers and 40 feet apart. It has about five-million-square-feet of contiguous underground space and Hunt can develop another eight-million-square-feet. Including the FSW lease, e-commerce companies occupy about 1,100,000-square-feet in the complex.
Tenants typically cut their energy costs by 50% to 70%. In 2012, SubTropolis earned a perfect ENERGY STAR energy performance rating of 100 from the EPA. Hunt officials say that of the six warehouse facilities in Kansas and Missouri that have earned the ENERGY STAR, SubTropolis is the only one to receive a perfect rating.
As reported in GlobeSt.com, Kansas City has become more successful at attracting high-tech companies, and with its central location, it may make a perfect fit for e-commerce companies that need to distribute nationwide. FSW says it will create 40 Kansas City-based jobs and, combined with Hunt Midwest, make an initial capital investment of $11 million.
“SubTropolis provides accessibility to the transportation networks essential to product distribution, is in close proximity to UPS and FedEx shipment facilities and is situated within a Foreign Trade Zone,” says Ora Reynolds, president of Hunt Midwest. “These factors are what is driving warehousing and distribution centers like FSW to SubTropolis.”
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
