FARGO - Site preparation is well underway for a warehousing and logistics center that when finished will be almost half the size of the nearby Amazon Fulfilment Center on the city’s far north side.

The $53 million Dakota Commerce Center, when fully built out, will offer 633,200 square feet of warehouse space designed for bulk distribution of goods. The nearly completed Amazon center is about 1.3 million square feet.

To celebrate, a formal groundbreaking ceremony for Dakota Commerce Center is set for 1 p.m. Monday, Aug. 9, at 3701 40th Ave N.

Paul Hyde, co-founder and owner of Minneapolis-based Hyde Development, said Amazon had a good bead on where to build, locating next to Interstate 29 and near Hector International Airport. He said his industrial park is designed to serve a variety of industries, but should also be a good fit for firms that work with Amazon.

“They’re (Amazon) very smart people in terms of picking locations and in terms of logistics, whether that’s trucks or (by) air. And we love our proximity to the interstate, and the visibility from the interstate, but we really also like our proximity to the airport. That’s why we picked it and I suspect that’s why Amazon picked it, as well,” Hyde said Tuesday, Aug. 3.

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Dirt work for the 42-acre Dakota Commerce Center started a month ago. Footings on the first building will be poured in late August, with the aim of getting the 127,500-square-foot structure completed in January 2022. Footings on the second building, also 127,500 square feet, will be poured in the spring, with the aim of having it ready in fall 2022. If leasing goes well, the third and fourth buildings would go up in 2023 and 2024, Hyde said.

Construction has begun on the first phase of a warehousing and logistics complex called the Dakota Commerce Center. The 633,200-square-foot development is being built by Minneapolis-based Hyde Development. Pictured is a bulldozer grading the site Tuesday, Aug. 3, 2021.
David Samson / The Forum
Construction has begun on the first phase of a warehousing and logistics complex called the Dakota Commerce Center. The 633,200-square-foot development is being built by Minneapolis-based Hyde Development. Pictured is a bulldozer grading the site Tuesday, Aug. 3, 2021. David Samson / The Forum

Each of the buildings will be precast concrete with insulated walls, Hyde said, similar to the two buildings his firm built in 2019 in Butler Business Park, at the intersection of Interstate 29 and Main Avenue. Each of the warehouses will have parking for cars and trailers, plenty of loading dock doors and two drive-in doors apiece.

Hyde had sought a $5.25 million property tax break for the project, but that was turned down by the Fargo City Commission earlier this year.

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Keeping the project going required creativity, Hyde said.

“You know, we needed that TIF (tax increment financing), it’s not just a made-up thing. ... We needed the TIF to cover our site work, that soil correction, to get those Fargo clays so that they don’t move in the seasonal changes and move our floors,” Hyde said.

And like other companies, Hyde Development has also been met with high prices for steel and wildly fluctuating prices for other materials.

“We were able to go back to the drawing board, and with a lot of creativity and some hard work, and some price relief from the sellers of the land … and interest rate relief, with all the dials turning in the right direction, we were able to make it work,” Hyde said.

The four buildings of the Dakota Commerce Center will be located just south of Amazon Fulfillment Center in north Fargo. Dirt work has begun for the first two buildings. Both are planned for completion in 2022. (Rendering courtesy of Hyde Development)
The four buildings of the Dakota Commerce Center will be located just south of Amazon Fulfillment Center in north Fargo. Dirt work has begun for the first two buildings. Both are planned for completion in 2022. (Rendering courtesy of Hyde Development)

Feeding fulfillment

According to Statista, the U.S. had almost 10.3 billion square feet of warehouse and distribution space to start 2021.

But much more will be needed as consumers continue their shift from shopping retail to e-commerce.

CBRE recently reported that global e-commerce sales have gone up 140% in the past five years, with 57% of that growth in the U.S. and China. Worldwide, it’s predicted that e-commerce sales will increase $1.5 trillion over the next five years.

To meet that demand, the U.S. will need 330 million more square feet of warehouse space dedicated to online fulfillment alone by 2025, CBRE reports. (Worldwide, that demand will be 1.5 billion square feet.)

Dakota Commerce Center is being built in north Fargo. Heavy construction equipment is lined up at the construction site Tuesday, Aug. 3, 2021. The warehousing and logistics complex will be south of the new Amazon Fulfillment Center. David Samson / The Forum
Dakota Commerce Center is being built in north Fargo. Heavy construction equipment is lined up at the construction site Tuesday, Aug. 3, 2021. The warehousing and logistics complex will be south of the new Amazon Fulfillment Center. David Samson / The Forum

Natural northern hub

Fargo Mayor Tim Mahoney praised Hyde Development’s work on Fargo's Butler Business Park. He said Dakota Commerce Center should do well, too.

Fargo’s at the crossroads of Interstates 29 and 94, centrally located for the U.S.’s northern tier, making it a natural hub, Mahoney said.

“People have discovered it’s a great place to set up shop and ship things all over the world,” Mahoney said. “(Shippers are) hitting the marks they want to do as far as shipping and volume and tonnage. If you look at the tonnage at the airport, it went from 50,000 to 250,000 over the last five years. So, we’re seeing tremendous amount of growth in our market of shipping and moving things around the country.”

That should help the region’s consumers, too, Mahoney said.

“Locally, we should be able to get our products quicker now. There may come a time that you can order something in the morning and it will be delivered at your place by afternoon,” Mahoney said.

Dirt work was ongoing Tuesday, Aug. 3, 2021, in preparation for the first phase of construction for a four-building warehousing and logistics development in north Fargo called Dakota Commerce Center. 
David Samson / The Forum
Dirt work was ongoing Tuesday, Aug. 3, 2021, in preparation for the first phase of construction for a four-building warehousing and logistics development in north Fargo called Dakota Commerce Center. David Samson / The Forum

'We like the growth'

Paul Hyde and his father, Mac Hyde, co-founded Hyde Development in 2012 with a focus on urban redevelopment and brownfield sites.

Beyond its Fargo projects (which also include a lumber yard rented to Parksite), the firm has industrial and logistics developments near Denver and in the Twin Cities.

The Denver-area industrial parks will top 7 million square feet when completed. They include 76 Commerce Center (1.8 million square feet) in Brighton and HighPoint Elevated (about 5.5 million square feet) near Denver International Airport.

The firm also developed the 122-acre Northern Stacks industrial complex in Fridley, Minn., just north of Minneapolis. It is also seeking other projects in the Twin Cities area.

Hyde said he likes the opportunities presented in the Fargo area.

“We like the people. We like the growth and we enjoy working with the city. It’s a very good city staff,” Hyde said.