MEMPHIS—Target has inked a 900,000-square-foot industrial lease worth $50 million. The lease will effectively reposition 5461 Davidson Road as a regional online fulfillment center.

Patrick Walton and Kemp Conrad with Cushman & Wakefield-Commercial Advisors in Memphis represented the property owner, an asset management and investment firm. Patrick Burke of CBRE represented Target.

“This project is a great Christmas present to the Memphis region and starts 2015 on a very positive note,” says Walton, noting that the distribution center is expected to generate more than 400 new jobs in Shelby County. “Labor played a major role for choosing Memphis.”

Target's site selection decision may also herald a growing trend in e-commerce distribution in the mid-south region. Walton says, “It's not necessarily a same-day requirement, but a more regionalized approach.”

Located near Memphis International Airport and Lamar/Highway 78, 5461 Davidson Road features 30-foot clear ceiling heights. Formerly home to Hamilton Beach, the property had been recently used for seasonal requirements. Walton says the deal represents the largest industrial transaction in this market this year, and in several years.

“In the past three years, users like Amazon and Walmart have invested in major tier-one markets and population centers to set up same-day or next-day delivery,” says Conrad, president of Cushman & Wakefield-Commercial Advisors Asset Services. “As those primary networks are built out, secondary regional investment will come next. Memphis is the perfect location to serve a large swath of the country for non time-sensitive catalog services.”

According to CushWake, hiring is expected to begin in early 2015. The site is slated to be operational by mid-2015. Innotrac, a 3PL vendor, will manage and the facility for Target.

“Memphis is America's distribution center because it is so centrally located,” says Conrad. “We can reach 75% of the country's population within a three-day truck drive and we're quadrimodal—meaning a nexus of logistical infrastructure including rail, roadways, runways and river.”