The distribution hub

As I pull up to the headquarters of the Little Rock Port Authority, I think to myself that there should be a photographer here.

Just to my left, barges are headed south on the Arkansas River. Upstream, I can see heavy truck traffic crossing the river on Interstate 440. In the sky above the highway, a plane prepares to land at Clinton National Airport. There are railroad tracks nearby. Ground, air, water and rail transportation come together at this spot.

In an era when the public hears more about supply chains than it cares to digest, central Arkansas finds itself in an enviable position, poised to become one of the nation’s major distribution hubs. When Amazon decided to build facilities employing thousands of people at the Port of Little Rock and just across the river in North Little Rock, it sent a signal to other companies that follow Amazon’s moves closely.

In late December, North Little Rock officials announced that Dollar General will build a $140 million distribution center that will employ 300 people initially and eventually grow to 600 employees. A 152-acre tract will house a facility covering almost a million square feet.

“These jobs are no longer $11-an-hour jobs,” Robert Birch, North Little Rock’s development director, said at the time of the announcement. “These jobs are actually getting up to $20 an hour, have strong benefit packages with them, and they’re places where you can work and advance.”

Just a month later, it was reported that Tractor Supply Co. will build a 900,000-square foot distribution center at Maumelle. The investment will be $100 million with construction beginning later this year. It will be the retailer’s 10th distribution center and will employ 450 people, a number that’s expected to grow. Tractor Supply operates 34 stores in Arkansas and more than 2,000 stores nationwide.

As distribution centers congregate in an area, manufacturers notice at a time when ease of shipping is everything. Note the announcement last October that Trex Co., which produces the nation’s leading brand of wood-alternative decking, will build a $400 million facility at the Port of Little Rock. The company expects to have 500 people working there within five years.

“With the outdoor living category continuing to show momentum and our success to date in converting share from the wood decking market, the time is right to further expand our capacity so we can meet future customer demand efficiently and effectively,” says Bryan Fairbanks, Trex’s CEO.

Efficiently. Effectively. Those are key words in logistics in 2022.

Trex has manufacturing operations in Virginia and Nevada. It needed a facility to serve the middle third of the country. Company officials mentioned the proximity to railroads, interstate highways, the airport and river as factors as it seeks to reduce freight costs.

Trex, which has more than 1,700 employees, makes products with 95 percent recycled materials. Raw materials include everything from plastic shopping bags to reclaimed scrap wood and discarded plastic film. The company is among the world’s largest recyclers of polyethylene.

“This regional manufacturing and distribution center will benefit greatly from our amazing assets–those being river, road, rail and air all intersecting in one place,” says Little Rock Mayor Frank Scott Jr.

After watching the barges for a few minutes on this sunny spring Tuesday, I walk inside the port headquarters to visit with Bryan Day, the authority’s executive director. Day notes that workers drive from 23 of Arkansas’ 75 counties to work at businesses that call the port home. When Day took over here in 2014, there were about 4,000 people working at the port. It’s now more than 8,000.

“The stars have aligned for us,” he says. “The next three to four years are going to be good ones. I honestly believe there will be at least 15,000 people working out here in 10 years.”

Amazon is secretive about the exact number it employs. Based on car counts, authority officials think there already are more than 3,000 people working at the Little Rock facility. That doesn’t include hundreds more working in North Little Rock.

“We’ve reached the point where we need restaurants, bank branches and daycare centers out here,” Day says. “We’ve had an incredible couple of years, and there are more announcements coming.”

In addition to distribution centers and manufacturing facilities, Day thinks the port can benefit from the lack of quality warehouse space in Arkansas. He says developers are planning massive warehouses for the port.

Another positive development has been the decision by the Federal Aviation Administration to move what’s known as a VOR cone (an aircraft radio navigation system) from port property. The cone has been at its current location since 1946. The Little Rock Port Authority was organized in 1959. Day even got the Arkansas congressional delegation involved in the effort to move the cone at port expense to a 110-acre site near the Galloway exit on Interstate 40 in North Little Rock.

“We’ve run out of land,” Day says. “We had to relocate that cone.”

Day is hopeful the current facility will be closed by the middle of next year. That will add 55 acres in the middle of what Day calls a 1,000-acre “supersite.” He thinks it just might be the best site of its type in the South given the area’s logistical advantages. Day can envision an automobile assembly plant or some other large manufacturer locating there.

When Day went to work at the port, there were about 2,700 acres in the complex. There are now almost 5,000.

“If we can get the right manufacturer to use the supersite, suppliers will follow,” Day says. “My goal is to continue buying more land and making more announcements that add to the central Arkansas economy. We want to become better in the years ahead when it comes to land management and real estate development. I hope we can buy another 3,000 to 4,000 acres from willing sellers to the south of us and then add to our roster of 45 businesses.”

When Day talks about real estate development, Trex’s plans provide a prime example of what he hopes to accomplish with other companies. Trex won’t just have a single manufacturing facility. It will develop a 300-acre campus that will include buildings dedicated to decking and railing production, plastic film recycling and processing, and reclaimed wood storage areas. There will be warehouses and administrative offices. Construction will begin this year with the first production planned for 2024.

Current companies at the port include HMS, a manufacturer that designs housewares; Interstate Signways, which engineers and fabricates transportation signage used across the country; Welspun Tubular, which manufactures steel pipes for the oil and gas industries; Lexicon Inc., which fabricates steel products, and Revolution Bag, which produces can liners.

There aren’t many business and industrial parks in the country that can claim to be a mile from a national airport and seven miles from the downtown of a state’s capital city. That’s not to mention being alongside the McClellan-Kerr Arkansas River Navigation System, which runs 448 miles from the Mississippi River to 15 miles east of Tulsa.

Union Pacific and BNSF serve the port’s switching railroad, handling more than 10,000 cars annually. The port also is classified as Foreign Trade Zone No. 14. At the heart of the port are three full-service river terminals, including the main terminal and two slackwater harbor docks.

According to a Little Rock Port Authority document: “Whether it’s made here or shipped here, the port’s commodity market mix focuses on attracting companies in sectors like advanced food products, chemical manufacturing, machinery manufacturing and expanded primary metals manufacturing. The port can move an impressive 200 inbound and 350 outbound tons of cargo an hour.”

In an era when the supply chain matters like never before, Day appears to have an exceptionally strong hand to play. That will be good for all of Arkansas in the years ahead.

Rex Nelson is a senior editor at the Arkansas Democrat-Gazette.

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