(Bloomberg) – Amazon.com Inc., now so overwhelmed with warehouse power that the epidemic-era shopping tide has faded, seeking to sublet at least 10 million square feet of space and leasing can further evacuate homeowners, people familiar with the situation. According to
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Additional powers include warehouses in New York, New Jersey, Southern California and Atlanta, people said, who asked not to be named because they were not authorized to talk about the deal. The excess of space could exceed 10 million square feet, two say, one said it could be threefold. Another person close to the discussion said that a final estimate of the square footage to be vacated could not be reached and the image remained in the stream.
Amazon could try to negotiate a lease termination with existing landlords, including Prologis Inc., an industrial real estate developer who considers the e-commerce giant to be its largest tenant, two people said.
In a sign that Amazon is being careful not to cut too deeply, the 10 million square feet that the company wants to sublet is about 12 big perfection centers or the equivalent of an epidemic equivalent to about 5% square footage. Will last two years.
The company declined to say which location it plans to sublet or quantify.
“Sublimation is a very common real estate practice,” said spokeswoman Alyssa Carroll. “It simply came to our notice then. Many established corporations are subscribing to help manage their real estate portfolios. “
Prologis declined to comment.
Amazon pushed investors last month after reporting slower growth and a weaker profit outlook that it was responsible for extra build-up during the epidemic when homebound buyers storm online. Towards the end of 2021, Amazon leased 370 million square feet of industrial space in its home market, more than double what it was two years ago.
In its April earnings report, the company said it expected additional space to contribute অতিরিক্ত 10 billion in additional costs in the first half of 2022. The company did not disclose how much extra capacity it had, where it was located or what it was. It was planned with. One way to reduce the cost of space that Amazon no longer needs is to subtract surplus space.
Amazon real estate firm KBC Advisors has been tasked with evaluating the warehouse network and determining where to sublet and where to close the lease, the two men said. Both options bear the cost. To sublet the warehouse space, Amazon will have to remove all of its equipment so that new occupants can tailor it to their own needs. The tenant usually has to pay a percentage of the rent for the entire term of the contract to complete the lease.
Finding a tenant will not be difficult. According to a February report by Prologues, the vacancy rate for industrial space is below 4%, the lowest ever, and rents have risen 17.6% by the end of 2021.
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