Amazon explores permit for AmazonFresh grocery service at Orlando warehouse

Amazon.com, Inc. is exploring plans to add its AmazonFresh grocery delivery service in Orlando, going so far as to file a permit request and plans in recent months to renovate part of a warehouse it's now leasing, before putting it on hold to evaluate locations and market demand.  

Amazon began increasing its direct footprint in Orlando last year, when in May 2016 the company confirmed a lease of 100,000 square feet of warehouse space near the tourism corridor to serve its Prime Now one- and two-hour delivery service.  

Located at 7469 Kingspointe Parkway in the Crownpointe Commerce Park, that warehouse currently houses the Prime Now and Amazon Logistics business units. Vacant space remains in the building, part of a four-building portfolio in the park bought by then-Colony Capital in April 2016

Amazon filed a construction permit request with the city this past June titled "Amazon Fresh," asking for partial interior demolition and renovations to build a new food distribution center of 96,050 square feet in that warehouse. Work was described to include coolers, freezers, a small bread baking room, small blast freezer, ambient storage and supporting offices. 

But in early August, Amazon's construction manager and architect CMC Design-Build told the city the permit request was being put on hold. The work was estimated at more than $9.68 million.

Since then, Amazon has been re-evaluating if that warehouse can accommodate AmazonFresh as a third business unit, and if the location offers the desired market demographics or if another site in the region is preferred. Under consideration is a new Amazon fulfillment center in Lake Nona with up to 2.33 million square feet of storage area, for which site work began in July.

In mid-September, Amazon asked the city, through a Tampa-based attorney, if the property's industrial zoning would allow storage and wholesale distribution of beer, wine and liquor, which the city confirmed. Amazon began adding alcohol to its Prime Now delivery service in other markets in 2015. 

Officials with Amazon did not respond to requests for comment on Tuesday. 

AmazonFresh is currently offered in Seattle, New York, Stamford, Trenton, Philadelphia, Boston, Baltimore, Washington DC, Northern Virginia, Dallas, Chicago, Miami, Denver and seven regions of California. 

As of now, AmazonFresh is treated as a premium add-on to Amazon Prime, with access to the grocery service costing an extra $15 a month to Prime members in the 20 markets where it's established. 

Many perishable food items can already be ordered via Prime Now in Orlando, including a variety of produce and dairy goods. 

Where AmazonFresh differs is its wider offering of perishables like regular and organic produce, raw meats and seafood, prepared foods, baked goods, a wider range of packaged deli items, meal kits, much of the Whole Foods' 365-branded product line, and a "farmers market" section featuring locally-sourced seasonal produce. 

AmazonFresh faces growing competition from grocery delivery services like Instacart, Shipt and Peapod. Walmart now has more than 900 stores offering grocery pickup, is testing grocery delivery with Uber and announced this year a project with Google to enable voice-based grocery ordering as soon as next year. 

Amazon has responded to the rampant competition this year by debuting "AmazonFresh Pickup" at a drive-up grocery store in Seattle, and by including AmazonFresh in its free Amazon Business program for companies that want to stock their office with fresh foods. 

In some markets, Amazon is partnering with local grocery stores to supply the fresh food items for its Prime Now delivery. The company announced in June its launch of Prime Now in Denver, where it's partnering with Sprouts Farmers Market for seasonal and organic produce, fresh meat and seafood, baked goods and more. 

Have a tip about Central Florida development? Contact me at bmoser@growthspotter.com, (407) 420-5685 or @bobmoser333. Follow GrowthSpotter on Facebook, Twitter and LinkedIn.

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