Building a giant cold-storage warehouse

NewCold creates strategic transportation hub for food producers to promote efficiency and sustainability

Last month, NewCold, a Netherlands-based company, celebrated the grand opening of the first phase of a highly automated cold storage facility in Lebanon, Indiana. Even before that project was finished, the company had announced in July that it was investing an additional $150 million in the same location to nearly double its original planned size of the facility to 710,000 square feet—which will make it one of the largest cold storages in the world. The new facility, located around 30 miles northwest of downtown Indianapolis, functions as a food warehouse, receiving products from producers such as ConAgra and distributing them to retailers like Walmart and Costco.

The NewCold development is interesting on several different levels. One, of course, is the size of the project, which is much larger than the typical cold-storage facility in the United States. According to a report from CBRE Research, traditional cold-storage warehouses usually measure between 150,000 and 400,000 square feet.

Another is its location in the Indianapolis area, which was designed, according to Jonas Swarttouw, NewCold’s Executive Vice President, and Chairman, of North America, to optimize shipper and receiver supply chains.

“We work very closely with the country’s largest food shippers,” said Swarttouw, in an exclusive interview with the AJOT. “We analyze their supply chains and pick the right location to store and distribute their products. In the case of ConAgra, one of our key customers, we came to the conclusion that for Midwest distribution and plants, the Indianapolis area was best to minimize transportation costs and have the most sustainable supply chain.”

Indiana and Cold Storage

Indianapolis is no stranger to cold-storage and distribution facilities. DB Schenker Americas has maintained a temperature-controlled facility in Indianapolis since 2005, doubling its size in 2021. DHL Supply Chain established a temperature-controlled site in Indianapolis in 2019.

Energy costs are key to figuring the costs to operate any cold-storage facility, and Indiana is advantaged when it comes to utility prices. According to data from the U.S. Energy Information Administration, electric power in Indiana costs around 8% less than the national average.

NewCold’s approach calls for building high, in the case of Lebanon, 150 feet off the ground. That increases the storage density, and, according to Swarttouw, makes the facility more energy efficient and more sustainable.

“Newcold’s warehouses have been shown to be around 50% more energy efficient than conventional cold-storage facilities,” said Swarttouw. The size of the facility also contributes to the “consolidation and simplification” of supply chains, and that “leads to a reduction in transportation mileage,” all of which contributes to energy efficiency and sustainability.

Building as tall as NewCold does presents challenges when it comes to the availability of suitable real estate. “When you drive around the countryside, you see a lot of empty places where you could potentially build a warehouse,” said Swarttouw. “However, there’s not a lot of land available at the right…