Madera County Economic Forecast: Online Processing Has Arrived

Among the residential projects underway in Madera is a community of 48 units downtown that will welcome families as well as veterans. It should be completed by the third quarter of 2022. Photo via the city of Madera

Madera County is preparing to join the e-commerce distribution revolution in the New Year.

Industrial space has always been scarce in Madera County, with much of the demand coming from value-added agricultural operations – food processing, container manufacturing, etc. But with two ongoing e-commerce operations, Madera is gearing up to join the ranks of Fresno and Visalia as fulfillment centers in the Golden State.

This is good news for a county which is rapidly diversifying its traditional agricultural economy while developing in a way not seen in other towns in the Central Valley. On both the commercial and residential side, Madera County is poised for growth in 2022 despite challenges that include Covid-19, drought, clogged supply chains and more.

“We are getting more activity and more views than ever in history,” said Bobby Kahn, executive director of the Madera County Economic Development Commission.

The first major e-commerce project in Madera County is expected to be under construction by the middle of next year, Kahn said. Called “Project Sunset,” the distribution center is said to be located in an industrial park in Chowchilla with access to Highway 99. Officials still do not know which company will operate the Sunset Project, which, after two phases, will consist of a warehouse of 750,000 square feet and 250 new jobs, Kahn said.

As Project Sunset completes its environmental review under the California Environmental Quality Act, a much more ambitious project in Madera County is just beginning the process.

The 3 million square foot Riverwood Fulfillment Center project is said to be located on 122 acres near Avenue 7 and Highway 99, according to environmental review documents filed with the state. The facility would have five floors and house a 24-hour operation that would create up to 1,874 jobs.

The project is being developed by Seefried Industrial Properties, a well-known development partner for e-commerce customers including Amazon. The tenant of the Riverwood project has not been revealed.

The Madera County Planning Commission could begin hearings on the EIR as early as June 2022, according to published reports.

Kahn believes these projects represent an economic change for the county that is evident across the United States. Third-quarter e-commerce retail sales were $ 214.6 billion, up 6.6% from the third quarter of 2020, according to new estimates from the US Census Bureau. Next year, analysts expect online retail sales to account for more than 15% of total retail sales. This figure was 5.3% just ten years ago.

For Madera County, the addition of e-commerce execution represents a shift in the economic makeup that was so dependent on agriculture, especially in the industrial space.

“We’re starting to see a pivot point with logistics companies, distribution centers, last mile centers,” Kahn said.

Demand for industrial land remains strong in Madera County – a trend that was present long before Covid-19. Over the past five years, industry vacancies have reached less than 1% in Madera County. Kahn estimates that it is currently around 2%.

“The Madera County industrial market is as active and robust as I have ever seen it,” Kahn said.

Some investors see an opportunity, especially when it comes to light industrial space. One of those projects comes from WHSE Partners, which will launch a 144,000 square foot light industry project on November 30 a few miles east of Highway 99 within the city limits of Madera.

The project is expected to be delivered by summer 2022 and will include 74 units of multi-tenant space with each unit just under 2,000 square feet. Kahn said potential tenants could include contractors and small-scale contractors who require a few thousand square feet and a small yard. More tenants mean healthier cash flow, making it a relatively safe investment, Kahn added.

The team behind WHSE Partners (pronounced ‘warehouse’) includes COO Erin Volpp and Founder and CEO Rob Boese. Boese also founded Boese Commercial, based in Fresno, in 2013.

“WHSE Partners is delighted to build and deliver a critical industrial component of Madera soon. Madera’s business-friendly environment and central location make the city a dynamic partner in this project, ”Boese said in a statement.

Another expected user of industrial and commercial spaces is the burgeoning cannabis market, which is set to debut in the city of Madera next year. Madera City Council is set to approve its cannabis licensing ordinance, which would grant up to six standard retail cannabis licenses and two social equity licenses, according to published reports.

In addition to retail, cannabis cultivation and storage have site breeders who put tires on vacant spaces that have been on the market for some time, Kahn said.

“It will add a whole other element to the economy,” Kahn said.

Still on the entertainment front, the highly anticipated Madera County Casino by the North Fork Rancheria of Mono Indians is expected to lead the way in the first quarter of 2022, Kahn said.

The controversial project was developed 18 years ago and has been taken to the California Supreme Court. With an apparent green light, the long-awaited grand opening near Highway 99 north of Madera can continue, but in a modified way.

Kahn said the project will likely be built in phases, with the first phase being the construction of the casino to generate cash flow, with a hotel and resort entering a later phase. In total, it should create 1,000 jobs.

“It will have a definite impact on the local economy,” Kahn said.

Residential growth has also kept pace with industrial growth, with two new major cities – Tesoro Viejo and Riverstone – expected to add thousands of new households and surrounding autonomous communities. Retail growth is also underway, with the revitalization of older malls and vacant spaces, such as the old Mervyn location, making way for Vallarta’s rapidly growing supermarkets.

With hundreds of millions of dollars of investment taking root in Madera County, growth should be the watchword for years to come.