Link Sees Warehouse Demand Building

Lee Klaskow (0:07)

Hi, everyone, this is Lee Klaskow and we're Talking Transports. Welcome to Bloomberg Intelligence Talking Transports podcast. I'm your host, Lee Klaskow, Senior Freight Transportation and Logistics Analyst at Bloomberg Intelligence, Bloomberg's in-house research arm. Before we dive in, a quick favor, if you enjoy the podcast, please take a moment to follow, rate, review, and share it with a friend or a colleague. Your support helps us continue to bring you conversations with leaders shaping transportation and logistics. And if you'd like to connect, you can find me on the Bloomberg Terminal on LinkedIn or on X at Logistics League. Joining us today is Luke Petherbridge, CEO of Link Logistics, one of the largest owners and operators of logistics real estate in the United States.

Warehouses are a critical link in the freight transportation network, connecting ports, railroads, and highways with businesses and consumers. That gives Luke and his team a unique view into freight flows, inventory trends, supply chain investments, and the broader economy. Today we'll talk about the outlook for logistics real estate, what Link's customers are telling them about the economy and the freight markets, and how technology and AI are changing warehouses. And also, where Luke sees opportunities for growth. Luke, welcome to Talking Transports.

Luke Petherbridge (1:20)

Well, thank you for having us, Lee. We really appreciate it.

Lee Klaskow (1:24)

It was my pleasure. You know, not everyone might be familiar, or listeners might not be familiar with Link Logistics. If you can give us an overview of the company, its portfolio, and kind of the customers that you serve.

Luke Petherbridge (1:34)

Yeah, absolutely. Well, I think you did a pretty good job giving the high level. We are one of the largest owners and operators of warehouses, particularly last mile infill warehouses in the country.

We have a little over 350 million feet of real estate in 50 different markets. We have about 8,000 customers. So whether that's the largest e-commerce, retailers, transport companies, 3PLs down to small business, America. So we really serve everyone across the country. We have 1,100 teammates that are based throughout the country. But a good way to think of it is like 3-4% of US GDP, flows through our customers in our building. So I think we do have a pretty nice purview. And we're really humble that we can support the economy the way we do.

Lee Klaskow (2:23)

That's awesome. And quick question. So are you predominantly your footprints in the United States? Do you have anything outside the US?

Luke Petherbridge (2:30)

We're in North America. So we operate predominantly in the United States, but then in Canada, Pure Industrial is part of Link. So we operate in Canada under the Pure Industrial banner.

Lee Klaskow (2:40)

Okay. Link has become one of the largest operators of logistics real estate in the US.

What's been the biggest driver for growth? Are you growing more through M&A of existing companies, or just buying up assets?

Luke Petherbridge (2:54)

It's probably a little bit of both. If you think of the last five years, we've really grown out and scaled our business. We started in 2019 We're only nearly seven years old as a firm. And a lot of it was through very large acquisitions. We are a Blackstone portfolio company, very large corporate acquisitions. We've bought a lot of one-off buildings or portfolios. And then we have built a pretty sizable development pipeline, where we've delivered over 30 million feet of brand new Class A lead certified buildings around the country. So it's a little bit of everything.

And we've been operating in most of the markets.

Lee Klaskow (3:36)

When you say development in your world, are you talking about like creating an industrial park, a logistics park out of, not thin air, but like green fielding or brown fielding?

Luke Petherbridge (3:45)

Yeah, absolutely. Yeah, so we can, development, whether it's an industrial park, multiple buildings, a brand new standalone building, but yeah, these are brand new buildings we've developed. We've also done redevelopment, where you take down older inventory and replace it with brand new Class A buildings. But yeah, we've developed land into new industrial buildings.

Lee Klaskow (4:05)

And are the part of the countries where you're seeing more growth in terms of these new opportunities?

Luke Petherbridge (4:10)

Yeah, I think, look, it varies over the different parts of the cycle. I'd say right now, what we've really started to see is, when you think of the demand profile, there's probably a few things that really sort of stand out, which then regionally will focus it. Whether it's the continued proliferation of e-commerce, whether that's generational shift in about a decade, 50% of Americans will have grown up with Amazon Prime. We continue to see Walmart and Amazon and others really focus on speed. That continues to be a growth lever. We are now starting to see on-shoring and near-shoring impacts. There's been almost a trillion dollars of announced factories throughout the United States. As you well know, once you sort of put a big factory, think of Tesla in Austin, there's a whole supply chain and network that gets built around that. That normally resides in warehouses.