TORONTO, Ont. – The McMaster Institute for Transportation and Logistics explored the freight village concept and its potential applications to Ontario during the Freight Hub symposium last week.
PhD candidate Chris Higgins outlined the key benefits freight villages can provide to an array of attendees at the International Centre in Mississauga on Nov. 29.
“We must first understand what a freight village is and how it can be applied to the Greater Toronto and Hamilton Area (GTHA),” Higgins said.
A freight village, according to Higgins, is a cluster of freight-related activity within a specific zone – commonly built for transportation and logistical needs, which also includes distribution centres, warehouses, storage areas, transport terminals, offices, public utilities, parking, etc.
“A freight village is an answer to a problem,” said Higgins. “On the private sector side, it’s to fulfill transport needs; for the public, it is the answer to congestion.”
One ideal example of an effectively functioning freight village, Higgins said, is Interporto Bologna in Northern Italian region of Emilia-Romagna.
Interporto Bologna, formerly known as Autoporto Bologna, opened in 1971 in partnership with the local and provincial government, chambers of commerce and road haulage associations.
“Interporto promotes intermodality and it relieves congestion in the city,” said Higgins.
By 1973, rail was brought in and the following year the site began its operations.
“Interporto Bologna is 12 kms from the city and the village includes customs, secure access, a post office, banks, a gas station, on-site maintenance for vehicles, restaurants and a shared tracking service,” Higgins said.
The site, which relies on rail and road transport, covers 1,055 acres, employs 1,500 people and houses 100 transportation and logistics firms, Higgins noted.
“Urban distribution reduces trucks in the city by an estimated 55,000,” said Higgins.
North 1,200 kms, in Bremen, Germany, at Guterverkehrszentrum (GVZ) Bremen, a similar facility was built, but this with an additional mode of transport – air and water.
“At GVZ Bremen, a freight village emerged from the desire to reduce truck traffic,” said Higgins.
The facility is the oldest and highest performing in Germany and was constructed over decades. It spans 895 acres with an additional 490 acres for future expansion, employs 8,000 people and houses 150 transportation and logistics firms.
GVZ Bremen has onsite truck maintenance, gas stations, customs and restaurants.
Across the Atlantic in New Jersey, the Raritan Center emerged slowly as a Freight Village on the site of a former military base. It covers 2.35 acres, utilizes road and rail, employees over 15,000 people and credits 391 transportation and logistic firms on site.
One last example Higgins shared, was a prime in-community integrated freight village, Alliance, Texas.
Alliance, Texas includes residential, commercial, recreation and institutional land uses.
“It sprawls over 17,000 acres and has 28,000 employees, although most are not involved with transportation and logistics,” Higgins said. “The site is managed by a strong private sector firm.”
One of the key attributes of a freight village is the access to shared facilities, equipment and value-added services, like customs, foreign trade, truck maintenance, conference space and training facilities, Higgins explained.
“Things that might be expensive for one firm, can now share expenses with another firm within the freight village,” Higgins said. “The village can promote synergies, economies of scale and reduce the risk of wasted movement as it has fewer transport links. It’s also a great incubator for smaller firms.”
But with the good comes the bad.
“There are some potential shortcomings,” said Higgins. “With the North American competitive mindset, many co-located firms do not interact. There is also a risk of oversupply.”
To that end, Higgins also noted that not all freight villages work out, but with a solid plan and support, their potential for success is strong.
“Freight villages with strong private sector support do better,” said Higgins. “Freight villages are also friendlier to small firms but benefit from strong anchor tenants.”
Location is a key to the success of a freight village – a base population of three million; multiple modes of transportation are required, but air doesn’t have to be one method of transport, while rail is nearly always a given; between 5,000-10,000 acres are needed; and a strong employment base is essential, Higgins pointed out.
“Freight villages offer a likely competitive advantage compared to other regions, but there are only a few places in Ontario that appear to fully suited to accommodate one,” said Higgins.
Some key considerations to explore, according to Higgins, include land ownership and zoning issues, private sector interest and their potential role, the impact on regional and localized congestion and the net economic benefits versus transportation improvements to existing logistical clusters.