Project: Logistics Park -Alliance TX

1.0 Synopsis

The Alliance Global Logistics Hub in Fort Worth, TX, completed in 1994 at a cost of $115 million, is one of the most successful multi-modal logistics parks in the United States, combining rail, trucking, and air freight facilities in close proximity. The Logistics Hub is part of the 17,000 acre Alliance mixed-use, master planned development in the far northwest suburbs of the Dallas-Fort Worth area. The construction of SH-170, at a cost of $6.8 million not only improved access for the high volume of commercial traffic to the Logistics Hub. It also provided development sites that attracted related shipping, logistics, communications, and technology operations to the area. Between 1992 and 2000, private investors developed 8 million square feet of commercial space, bringing 8,500 new jobs to the area. The Alliance Global Logistics Hub has sparked the growth of a new sub-region of the northwest DFW Metroplex.

2.0 Background

2.1 Location & Transportation Connections

The Alliance Global Logistics Hub straddles Tarrant and Denton counties on the northwestern corner of the Dallas-Ft. Worth metropolitan area and has direct access to I-35W. Dallas-Ft. Worth is a major hub within the national Interstate network. Motor carriers using Alliance can connect with I-35 (with access to the Mexican border to the south and Minneapolis to the north), I-45 (to Houston), and I-30 (to Memphis). South of Alliance, I-20 links Ft. Worth with the U.S. Southwest and West Coast (via El Paso) and the Southeast (via Atlanta).

Within the Alliance complex, the 6.9 mile SH-170 connects I-35W with SH-114, a direct route to DFW Airport, 20 miles to the east, with passenger air service.. Distribution facilities location along SH-170 can reach Alliance Airport and the BNSF Intermodal Facility on limited access roadways free of traffic lights and stop signs within 15-20 minutes.

Alliance Airport is exclusively a freight and general aviation airport. The airport includes a 13,000 foot runway, allowing fully-loaded cargo planes to reach Asia. FedEx's Southwest Regional Sort Hub operates from Alliance. The BNSF railroad focuses on the central and western parts of the United States. Direct train routes from the Ports of Los Angeles-Long Beach and the Port of Oakland allow containers shipped from Asia to be transferred to trucks and stored at warehouses located at the Alliance Global Logistics Hub. From Alliance, merchandise is distributed by truck to the fast-growing Texas and U.S. South Central markets via the Interstate system, primarily to destinations within 500 miles of the facility. Outbound deliveries are distributed by direct rail routes to the Southeast (Atlanta; rail service via CSX through Birmingham) and Midwest (Kansas City, St. Louis, and Chicago).

Since Alliance Airport's opening in 1989 and the BNSF rail intermodal expansion in1994, the Alliance Global Logistics Hub has helped set the stage for a major expansion of jobs and population into the northern part of Tarrant County and into Denton County. Direct access to I-35W, including developable land around SH-170, and the BNSF rail network made the growth achievable and has allowed the Alliance Global Logistics Hub to act as a catalyst for logistics, commercial, and residential development in the region.

2.2 Community Character & Project Context

The area around the Alliance Global Logistics Hub is a growth node for the quickly expanding Dallas-Fort Worth metropolitan area. When it was built on a greenfield site in the late 1980s and early 1990s, the areas in the vicinity of the Alliance Global Logistics Hub were well to the north of the urbanized sections of Fort Worth and surrounded by prairie and ranch lands dotted with oil rigs. With the growth of the Alliance project, the area has become low-density suburban in character, with new residential and commercial development generated by the Logistics Hub located along SH-170 (aka Alliance Gateway Freeway).

3.0 Project Description & Motives

The earliest phases of the Alliance project were planned and developed during the 1980's as Fort Worth was confronting challenging economic circumstances following the collapse of the Texas oil and gas, real estate, and finance industries. In response, a unique private-public partnership forged when Fort Worth badly needed to create jobs and to diversify its economy. The FAA had been looking to build a small airport in the area to take pressure off of fast-growing DFW International Airport. The City, Federal Aviation Administration (FAA), the Texas Department of Transportation (TXDOT), and Hillwood Properties (a land investment firm owned by the Perot family who owned a significant amount of property in the area) formed the Alliance Project as part of a cooperative effort. The Hillwood-owned land was well suited for a reliever airport and was selected among five candidates. Fort Worth Alliance Airport opened in December 1989.

The airport was the first major piece of infrastructure at the Alliance Global Logistics Hub. As Hillwood began to market to a variety of companies (wireless, automotive, aviation), the Alliance project began to evolve and grow. The first big announcement was a surprise because it did not involve aviation. The ATSF Railway (later to become the BNSF in 1995 through merger) decided to construct an automotive off-loading facility at Alliance completed in 1990. More significantly, the ATSF selected Alliance for a new rail intermodal facility to replace an older ATSF intermodal yard in Dallas that had been acquired by Dallas Area Rapid Transit (DART) for conversion into a maintenance facility for DART's new light rail trains. The ATSF wanted to relocate the intermodal facility to the western part of the Metroplex because one of its high capacity main lines was already in the area. The ATSF intermodal facility was completed in 1994 at a cost of $115 million ($1994) to build and immediately experienced fast growth.

The building of a high capacity roadway network within Alliance to provide access between building sites, the airport, the BNSF Intermodal Facility and I-35W was and continues to be integral to the success of the Alliance Global Logistics Hub. Alliance's road network was designed to operate without traffic lights, allowing a faster and more efficient flow of trucks. SH-170 serves a crucial role by linking large developable sites with the intermodal facilities and I-35W. Hillwood Properties sited the industrial park for shippers and logistics companies on the Eastern side of SH-170, about 7 miles away from the rail intermodal facility and 5 miles from the airport, rather than sites immediately adjacent to the freight transportation facilities.

By pushing development to SH-170, the company prevents the overloading of the land next to the airport and rail intermodal site, reducing congestion and allowing for more balanced pattern of development at Alliance in the longer term. The six-lane road capacity on SH-170 is much greater than the two-lane roadways closer to the BNSF Intermodal Facility and can better accommodate a concentrated grouping of intensive truck users.

The construction of SH-170 along a 6.9 mile corridor of the Alliance complex was the result of a public-private partnership between Hillwood Properties and several public agencies. To expedite the building of the highway, Hillwood donated 430 acres of right-of-way for the highway which it had acquired back in the 1980s. The company funded a complete set of environmental studies, schematics, and design plans for the new highway.

The construction of SH-170 was fast-paced, only taking two years, and done under the supervision of TxDOT. To keep the highway project moving forward, the Perots had hired a dedicated project manager. The highway was opened in mid-1992, two years before the completion of the BNSF Intermodal Facility. The unique public-private partnership is believed by Hillwood to have shaved two years off the highway construction schedule. With the right-of-way cost zero, TxDOT built three lanes of frontage road in each direction (6.9 miles east and west) at a cost of $6.8 million to form SH-170. Today (2010), a freeway (8-lane) between the frontage roads is being planned to handle the traffic growth that the two original frontage roads that today comprise SH-170 are becoming less able to accommodate.

4.0 Project Impacts

4.1 Transportation Impacts

4.2 Demographic, Economic & Land Use Impacts

Denton and Tarrant counties comprise one of the fastest-growing urban areas in the United States. The expansion of these two counties has largely taken place within the automobile age. During much of this period, growth was focused towards the eastern part of Tarrant County as Fort Worth and its suburbs (Arlington, Hurst, Bedford, and Euless) grew towards Dallas. The opening of DFW International Airport in 1974 pushed more growth towards the northeastern parts of Tarrant County. The building of the Alliance Global Logistics Hub in the 1980s and 1990s has helped shift a portion of this growth farther to the west and into Denton County. Indeed, since its completion in 1992, traffic numbers on SH-170 are a testament to the continued fast growth of the Alliance Global Logistics Hub and of the development of the northern and western parts of Tarrant County, in particular.

The Alliance Global Logistics Hub, since its initial opening in 1989 followed by the opening of SH-170 in 1992 and the BNSF Intermodal Facility in 1994, has invigorated Fort Worth, lifting it from the 1980s oil bust. It has served as a major economic generator, shifting a portion of Dallas-Fort Worth's commercial and residential growth towards the northwest. Between the completion of the intermodal facility in 1994 and 2000, Tarrant County and Denton County grew by 15 percent and 36 percent, respectively, compared to 13 percent for the entire State of Texas, adding a total of nearly 300,000 people.

The Texas Motor Speedway opened in 1996 just over the Denton County line on I-35W and now the second largest sporting venue in the United States, has created an additional activity center in the proximate area. As commerce and population settlement has spread, the Alliance Global Logistics Hub is no longer on the frontier and now helps to define the northwest extent of the most heavily developed portions of the Dallas-Ft. Worth metropolitan area.

The completion of SH-170 provided the opportunity to develop almost 2,300 acres of ranch and prairie land. With an infrastructure that provides direct access to rail, air, and Interstates, companies have recognized the benefits of an Alliance Global Logistics Hub location to improve the speed and efficiency of their operations and better serve their customers. The opening of SH-170 and the industrial park near the junction of Route 377 triggered a boom that brought 8,500 total jobs (logistics, manufacturing, and distribution facilities serving specific communications, technology, and retail companies) and 8 million square feet of new space proximate to the highway corridor between 1992 and 2000.

The entire 17,000 acre Alliance project, after a slow start due to the national 1989-1992 recession, had grown to 20,500 jobs by 1999,. 8500 of these jobs are directly related to the intermodal portion of the project and 12,000 in office, service, and retail sectors. Reflective of this surge in development, total direct property taxes paid to local jurisdictions by Alliance increased from $7 million in 1994 to $46 million in 2000. Hillwood considers the construction SH-170 as the lynchpin to unlocking the development potential of the Alliance Global Logistics Hub. Companies, including General Motors, Ryder Transportation, Dell, and UPS Logistics, among others have located facilities along SH-170 to capitalize on the efficiencies brought by the advanced multimodal facilities and the ease of access to the U.S. South Central and Southeastern markets.

5.0 Non-Transportation Factors

The Alliance project is now 20 years old and represents one of the largest real estate development projects in the country. It is unlikely to have happened on this scale without the leadership and vision of the Perot-owned Hillwood Development Company, who had speculatively acquired property in the area, worked with state. Local, and federal authorities to site Alliance Airport here, donated the right-of-way, and paid for the planning studies for I-170, which has been the locus for most of the related warehousing and logistics development that the airport and the BNSF intermodal yard has spawned.

The project has benefitted by its location within one of the fastest growing metropolitan areas and regions in the country. Project timing coincided with a fast rise in international trade, particularly with Asia. Additionally, the entire Alliance Global Logistics Hub is within a designated Foreign-Trade Zone (FTZ). The FTZ offers companies cost savings by allowing merchandise to be held in inventory without paying Customs duties and eliminating state and local ad valorem taxes. Being within an FTZ is a key factor in companies' decisions to locate at the Alliance Global Logistics Hub.

It should be emphasized that Alliance's success would be difficult to replicate. As a very large, master planned project, with land owned by a single entity, Alliance Texas has had a large degree of control over development. It has worked to preserve the integrity of its transportation assets and to keep transportation, warehousing, and residential land uses separate. This reduces the risk to investors by mitigating encroachment issues and has quelled community resistance to expansion.

6.0 Resources

6.1 Citations

6.2 Interviews

Organization

Footnotes