MCALLEN, Texas – Customs broker and logistics expert Jorge A. Torres is asking the City of McAllen to be more proactive in finding and developing land for warehouse construction.
The founder and president of InterLink Trade Services said the city could help by providing incentives and streamlining the permitting process.
“It is a major challenge. It is a major problem. There is not enough warehouse space so now we are having to store product in trailers,” Torres told the Rio Grande Guardian International News Service.
“In my business we probably have about 20 trucks where we are storing product.”
Torres gave his interview upon the conclusion of a recent McAllen Economic Development Corporation board meeting.
“Unfortunately, like I said, with the current situation, with inflation, with the interest rates hike, with the shortage of labor, with the Asian supply chain issues, it is becoming very complex to build,” Torres told the Guardian.
“So, we need any help that the city can provide in the form of incentives and infrastructure, to be able to expedite the process of construction and reduce some of the costs.”
But it was put to Torres that maybe there is simply no land available, something providing incentives would not fix.
Torres responded: “Yes, I know that is an issue some cities have and I know that the City of McAllen has that and there is not enough land available for industrial development. There are a couple of properties that they have but I know that they are looking into what they need to do on that land. Bottom line, they need to do things faster. Be more proactive.”
Torres brought up the issue of land availability for warehouse construction during the Any Other Business part of the MEDC board meeting.
“In this city right now, as has been discussed, warehouse space is very limited. I am a logistics provider and we don’t have warehouse space. We are storing product in trucks. I have been dealing, personally, on a case by case basis with my customers. They are looking to us for solutions,” Torres told the MEDC board.
Torres said it was not just a problem for him. He said other logistics firms are also struggling to find land.
“Everyone is looking around for space. And the space race right now, for whatever is available, is very high, is very expensive. So, we need to do something about that,” Torres said.
“We saw Johnson Controls went to Weslaco. I know that Brownsville is working to develop an industrial park so I think the city (of McAllen) needs to be more proactive. I don’t want to put you on the spot, in terms of providing incentives and helping companies materialize their projects, but we need help.”
The rise in interest rates is not helping matters, Torres explained.
“That adds to the burden of financing, besides the cost of materials with inflation, besides the labor shortage,” Torres said.
“There is no developed land. So, we have a perfect storm… to the point where, for additional space it is becoming a nightmare.”
Working in conjunction with McAllen EDC, Torres has hosted a number of webinars in recent years on the impact of the United States-Mexico-Canada Agreement, the successor to NAFTA.
At the recent MEDC board meeting Torres said he was working on a one-day summit that would cover USMCA, supply chain challenges, and more.
“I have approached them (MEDC) and had an initial discussion to have another webinar to update what is going on right now with the supply chain issues and how USMCA is going, etc.,” Torres said.
“In those discussions, I think we can do something more detailed like a summit. So, we are talking about doing a summit, a whole day deal, talking not only about USMCA and the supply chain but also bringing to the table issues such as real estate, capacity, labor issues.”
Index Reynosa, the maquiladora trade association, local land developers and city leaders would be invited to the summit, Torres said, “to discuss what is going on right now and how we can assist or help our region grow because, as you know, there are a lot of companies that are leaving China and Asia and re-shoring and near-shoring, relocating to have a closer supply chain.”
The current trend is for more vertical integrations, the logistics expert explained.
“We do see there is a lot of opportunity in our region, being on the border, having the maquiladora industry on the Mexican side. And on the U.S. side having storage, distribution, logistics and some manufacturing as well,” Torres said.
“But, we need to make sure that we can attract and bring companies to the area and doing a summit like this, I think, will be a great idea. To show what we have and also to discuss the real issues that we are encountering right now.”
Torres said he hopes the summit can be held in September or October of this year.
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