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Amazon is on a real estate buying binge
Amazon literally doubled down on owning real estate last year.
The e-commerce giant finished 2021 with twice as much of its own warehouse, distribution and data center space as it began the year.
The buying spree brought its owned real estate portfolio to 16.7 million square feet across North America, according to an annual financial report, up from 8.5 million at the end of 2020. The year prior, the company reported 5.6 million square feet of owned fulfillment space.
Still, Amazon’s own properties are a small fraction of its North American footprint — around 4 percent.
Amazon was leasing around 370.4 million square feet at the end of 2021, a 30 percent increase for the year. That’s about as much as the U.S. General Service Administration owns and leases for federal employees, and almost double the amount of office space in Midtown Manhattan.
Since the start of the pandemic, Amazon has doubled its space as it raced to meet demand for online shopping and ever-faster delivery.
Its net sales increased to $469.8 billion last year, a 22 percent increase from 2020. The e-commerce behemoth just announced it will raise the price of its monthly and annual Prime memberships in the U.S. to $14.99 and $139, respectively.
Amazon’s real estate purchases come as industrial players struggle to find adequate warehouse and distribution space. In some markets, vacancy rates are approaching zero percent. Development has been slowed by supply chain issues and labor shortages.
Over the past six months, Amazon has bought a number of development sites. In August, it paid $85 million for a 133-acre site in Sunrise, Florida, where it plans a fulfillment center. A month later, Amazon said it would build a distribution center on almost 60 acres of undeveloped land it bought in Pleasanton, California.
The company is bolstering its white-collar operating as well. In November, it bought a 30-acre campus in Orange County, California, with around 640,000 square feet of offices, for $165 million.
No redevelopment plans have been filed for any of these deals.Contact Isabella Farr.
