Friday January 14, 2022

Inside the deal: A key chapter in REI’s Lebanon shipping expansion came when there wasn’t much to talk about

Al. Neyer has partnered with REI Co-Op to develop, design, and build its fourth distribution center in Lebanon, TN, which is expected to be complete in the fall of 2023. We’re grateful to Bill Best and the team for instilling their trust in Al. Neyer as a partner.

From Nashville Business Journal:

As much as anything, what propelled Bill Best to open a $109 million shipping hub in Wilson County didn’t come down to any particular negotiation — but instead, what occurred over many months when there was nothing to negotiate.

Best is vice president of supply chain at Recreational Equipment Inc., or REI. He knew before the pandemic struck that the national outdoor retailer needed a fourth distribution center in the U.S. The co-op, owned by its members, has a goal of ballooning membership from 20 million-plus to 50 million by 2030. A new facility would be vital to sustaining current business and corralling new customers.

Best wanted a spot in the South, and a number of metrics led him to Lebanon, including workforce availability and how many REI stores and customers could be reached within two-day standard shipping.

REI’s online sales eventually surged as Covid-19 persisted, but for many months, the pandemic-induced economic shutdowns were unkind to REI and many other retailers. REI was working with developer Al. Neyer LLC on its site search, but didn’t have any kind of formal agreement or contract in place with the developer when REI halted its expansion efforts as the pandemic began gripping the nation.

Best and Al. Neyer principal Justin Hartung still spoke at least once a month, talking about market conditions and other observations. REI rebooted its expansion plans in mid-2021 — more than a year after pausing.

“That engagement carried through. It made it much easier for us to restart,” Best said. “As we saw those correct signs of recovery, from REI’s perspective, we were well-positioned to accelerate our plans.”

Read more from Adam Sichko in Nashville Business Journal.

About the Project

Al. Neyer’s integrated team of developers, architects, and construction experts are working closely with REI to build a state-of-the-art distribution center that will serve more than 70 REI stores and 5.6 million co-op members. The facility will be approximately 400,000 SF and include features that support the employee experience and community engagement while lessening its environmental impact. The project is expected to be completed in the fall of 2023. Read more in our portfolio.

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