VOL. 11 | NO. 31 | Saturday, August 4, 2018
Long, Winding Road
By Patrick Lantrip
Considered by many to be the main artery of Memphis’ robust logistical and distribution network, the Lamar Avenue Corridor has long been clogged by its own narrow lanes and outdated capacity.
To make matters worse, it has grown to encompass 535 truck terminals, 19 freight intermodal facilities, four rail yards, three air-and-truck terminals and an influx of freight traffic from nearby Memphis International Airport, all jockeying for position on a four-lane stretch of state highway from the Mississippi state line to Getwell Road.
But with an estimated price tag north of $250 million, local officials and business leaders could only do so much to improve Lamar Avenue without additional federal funding.
So for nearly a decade, conditions along the underfunded highway worsened as industries on and surrounding it continued to grow.
“We're the logistics and distribution center of the universe, and Lamar is at the center of that universe when it comes to surface traffic and trucking,” Greater Memphis Chamber CEO Phil Trenary said. “There's 70,000 people employed in that area, and over 1,300 companies including 20 Fortune 500 companies.”
While those are impressive numbers, Trenary said the condition of Lamar has become a critical issue in terms of both recruiting new businesses and retaining existing ones.
“In the past two to three years, delays became the No. 1 issue,” he said. “This year alone, transportation costs are up about 30 percent, so if you have goods and services in a truck and you can't get out of the Lamar Corridor, that's real money and people have to think about going somewhere else.”
More often than not, somewhere else usually ends up being just down the road in North Mississippi, where there are broad expanses, additional lanes of traffic and no potholes.
“It's not just widening – it's also new exchanges and improving Lamar from a safety standpoint,” Trenary said. “It all comes to one word and that's competition. It was hurting our competitiveness and our ability to attract and retain jobs.”
Lamar became a top priority for the chamber and its Regional Logistics Council and has been for the past decade.
“Lamar was causing shipments to be delayed. Some companies actually cited that as the reason they left, so it was a very important economic development issue,” he said.
Hope for the outdated freeway officially went from pipe dream to tangible reality last month thanks in part to a $71.1 million federal transportation grant that bridged the project’s last financial gap.
“Something like this takes continued pressure and has to transcend administrations,” Trenary said. “You just stay on top of it, so the chamber led the pressure year over year.”
Even though the need to overhaul the roughly 4.5-mile stretch of Lamar Avenue seemed like an obvious choice for federal funding, competing projects all vying for a limited amount of funds always seemed to keep Lamar just out of reach.
Cranes from the the BNSF intermodal facility tower over congested traffic on Lamar Avenue north of Shelby Drive on Tuesday, July 24, 2018. The Lamar corridor project recently received a $71 million grant with the goal of reducing delay times for drivers along the semi-truck choked stretch of highway. (Memphis News/Jim Weber)
“There's a lot of demand for the money,” Trenary said. “If you think about the work that's been going on in Memphis, there’s tremendous investment out east on the I-40/I-240 interchange. That's the largest project in the state of Tennessee.”
Trenary said securing the grant took the combined efforts of the city and county mayors, both Tennessee senators, three congressman, and many of their counterparts in Mississippi in a process that spanned two presidential administrations.
“Government cannot do it on its own,” he said. “A chamber or a business can't do it either. So you take that great leadership from our administration, and couple support and collaboration provided by the business community.”
Hunter Adams, an associate with Colliers International who specializes in the acquisition, disposition and leasing of warehouse space in the Greater Memphis area, said the Lamar Corridor is vital to the area’s robust logistics and distribution operations.
“Lamar Avenue is the main artery of our largest industrial submarket, so it’s the lifeblood,” he said. “But if you’ve been there in the morning or the afternoon, you’ll wish that you didn’t – it’s packed.”
Many of the problems stem from the fact that Lamar has not grown with the plethora of development that has sprung up in the area, he said.
“Everyone else poured money into it, but the government was hamstrung,” Adams said, citing large private-sector investments from companies such as Burlington Northern Santa Fe, Nike Inc. and Williams-Sonoma.
And when it comes to attracting new companies to the area, Lamar in its current state isn’t doing anyone any favors.
“Real estate is a very small percentage of their overall costs, so we try to consider what are some of the other main parts, and transportation, in general, is a huge part of it,” Adams said. “Your driver’s time in the car matters.”
So when unreasonable delays and road site maintenance caused by poor road conditions become the norm, it can have an adverse impact on the bottom line.
“This is truly restricting and holding back our industry,” he said.
Thanks to the $71 million federal grant, however, Adams said relief appears to be on the way.
One of the major stakeholders in the area, BNSF Railway, went through a nine-figure upgrade of its own when it spent more than $200 million to overhaul its Memphis Intermodal Facility in 2010. BNSF public relations director Joe Faust agrees that the Lamar’s current condition is holding the area back.
“The new facility has doubled BNSF’s lift capacity in this important and growing region of the country, and allows for continued growth in handling conversion of long haul highway truck moves to rail,” Faust said. “Our intermodal trucking partners utilize Lamar Avenue to deliver goods to the final destinations for our customers in Memphis and throughout the Southeast region.”
EASING THE PAIN
Faust said Lamar Avenue has been identified as a significant bottleneck impacting freight movement throughout the southeastern United States, which creates problems for companies all around the county.
“The upgrades on Lamar Avenue will be good for the entire region, benefitting a network within a 250-mile radius of our operation,” Faust said.
“It’s already becoming a selling point when I talk to people about the location as far as ease of use or ease of moving goods,” he said. “What the final product ends up being, we won’t know, but they have a plan and hopefully it’s implemented correctly and things can change.”
Adams said if everything goes as planned, this in turn could help unlock the last large parcels of developable land in Memphis that have been locked up until now.
“Since the mid-2000s, most if not all of the brand-new development has occurred down in Mississippi,” Adams said. “A new Lamar Avenue coming through there could mean possible reinvestment or renovating current buildings there, because you have that added amenity.”
Nichole Lawrence, community relations officer for Region 4, Tennessee Department of Transportation, said the Lamar Avenue overhaul will be segmented into three separate projects.
“It’s a four-lane divided section now; we’re adding a lane in each direction to make it six lanes,” she said.
The first project being bid for construction is from the Mississippi state line to just south of Shelby Drive and will begin construction this fall, Lawrence said, while the second project is south of Shelby Drive to near the Raines Road/Perkins Road interchange.
“The right-of-way acquisition for (the second) section is going to begin this fall,” Lawrence said. “That would put the construction for that section in 2021.”
The last section to be widening Lamar from the Raines Road intersection to Getwell Road.
“Those right-of-way acquisitions are tentatively scheduled to begin sometime in 2019,” she said.
However, there is no date set to begin construction on the third leg of the roughly 4.5-mile project.
“Right-of-way costs in that area are quite high because of the businesses and the area that we’re in,” she added.
In addition to the extra lanes, several key intersections along the corridor will get massive upgrades.
“The entire corridor has three major congested intersections that we’re going to be upgrading into new interchanges,” Lawrence said.
Most of the work over the next few years will be done at night, she said, because it’s generally easier and safer during off-peak hours.
“There are always headaches when you are talking about construction and building and widening your infrastructure,” she said. “Of course, there are always instances where we have to, for everyone’s safety, to work during the day, but we’re going to be committed to doing as much of this at night as we can.”