How South Jersey became warehouse alley for major retailers

It was a Tuesday in early October at the Cowtown Farmers Market, and everything from blue jeans and underwear to samurai swords and stun guns were for sale under the long brick-colored barn off Route 40 in Salem County, New Jersey.

“You’ll notice it’s not very busy,” Grant Harris, the fourth-generation owner of the century-old flea market and rodeo, said. “Tuesdays are really suffering.”

Cowtown is only open on Tuesday and Saturday, and in the past, the former was the busier of the two days. Now it’s slower, in part because Cowtown is competing with the likes of Walmart, Amazon, and Dollar General. “Super discounted merchandise used to only be accessible in a market like this,” he said. “Now there’s a lot of competition.”

Harris has watched this evolution firsthand, with a number of those big-name competitors setting up shop just down the road. All along the New Jersey section of Route 40, which extends from Atlantic City all the way to Silver Summit, Utah, millions of square feet of warehouse space are under construction, transforming this once-sleepy corner of rural South Jersey into a logistics hub for the biggest retailers in the US.

• According to CoStar, developers have built 5.1 million square feet of industrial property across 10 buildings in Salem County since 2020. Another 2.1 million across three speculative buildings is under construction, and 5.3 million is proposed across nine speculative buildings, bringing the total to 12.5 million square feet, or 217 football fields.
• Some of the biggest tenants include Amazon, Walmart, Five Below, and Goya, some of which are leasing spaces that were built on spec by developers looking to cash in on the rapid expansion of e-commerce and delivery infrastructure.

For many locals, the boom has meant making the decision to hold out or sell out. The 70-year-old Harris said multiple developers have attempted to buy his land, offering sums in the range of $40 million. “Were it not for my children being interested in continuing this operation, I’d be long gone, Jack,” he said. “I mean, I could go out and buy 10 square miles in Kansas, take my cows and horses with me, and be on cloud nine.”

But that is exactly what a number of Salem County property owners have done in recent years, as deep-pocketed developers have come knocking at their doors. While for Harris, the decision was ultimately personal, the explosion in warehouse development has forced many in the region to think long and hard about what this logistics-led model of economic development will mean for them in the long-run.

The final frontier: Driving south into Salem County on Route 130, it seems the jury is still out on whether residents see warehouses as a positive development for their community. Dozens of signs planted in front lawns read “No More Warehouses… We have our fair share—we’re done.” Elizabeth Neff, 83, who has lived along the road since the 1960s, lamented the increase in truck traffic that passes her house on a daily basis, as well as the loss of local farmland. “This is not a green state anymore,” she said. “We bought this house because this was supposed to be the Garden State.”

Yet Salem County has been partly industrialized for decades, going back to the late 19th century when DuPont opened its smokeless gunpowder plant in Deepwater, a town close to Neff’s home. Teflon was invented at that same facility in 1938, and today, under Chemours, it manufactures dry films.

The warehouse boom is a more recent phenomenon, and it took some time for developers to make their way this far south. Ryan Curran, president of Curran Commercial, told Retail Brew it started around 2018 when his brokerage firm began assembling parcels around Route 40. The goal? To attract Amazon into the area.

“To be totally transparent, it was 100% speculative,” he said.

Curran’s investment thesis was that Salem County was well-located to serve multiple metropolitan markets, given current limits on truck driving shifts. “Within that nine-hour driving shift, they can hit New York, Port of Elizabeth, Port of Newark, Port of Philadelphia, Philadelphia, Port of Baltimore, obviously all of Delaware, all of Maryland, and far out into Pennsylvania and beyond,” he said. Proximity to a FedEx airport in South Philadelphia ensured that these new warehouses were also a short drive from gaining access to the entire US market, he added.

But it was Amazon’s decision to actually move into the location along Route 40 that kicked off the wider boom, according to Curran. “Once Amazon comes in and goes up, everybody else feels warm and fuzzy,” he said. “It’s like, ‘Oh man, these guys did their homework. This looks good.’ And then everything piles on top of that.”

Selling South Jersey: The marketing materials for the latest crop of warehouse projects reflects how major players are now preaching the gospel of South Jersey. NorthPoint Development’s Turnpike 1 Trade Center touts that tenants will be able to reach 50% of the US population within a two-day truck drive, while Rockefeller Group’s Logistics Center at Carneys Point promises “immediate highway access.”

What’s good for retailers though is not necessarily good for residents and local businesses. Harris said one immediate concern is traffic congestion. “There’s a lot of traffic on Route 40, and now we’re going to add thousands of trucks a week, if not a day.”

Others are more concerned with the loss of farmland, such as Dean Sparks, deputy mayor of Oldmans Township, which is adjacent to the Route 40 corridor. The long-time corn and soybean farmer has fought to preserve farmland from development, including turning down some serious money for his own land. “See, I’m sentimental on the farm side,” he said. “I actually want to preserve my farm for agriculture.”

Curran said he understands the emotional connection to farms and open fields, but stressed that warehouses are how this part of South Jersey will get access to more resources and amenities. “What’s going to come behind this is only going to continue to make communities flourish, because now you can put in retail and more amenities,” he said. “You know, its just the way it is. That’s the way the world is built.”