Iowa is known for its immense agricultural production, but the state’s newest crop is offering transportation and logistics services to heartland shippers.
Travero, a longtime Iowa transportation company, has started construction on a logistics park at Cedar Rapids that by this time next year will unite shippers with the nation’s Class I rail network and beyond.
The first phase of the facility will be located on 36 acres of the 101-acre logistics park southwest of downtown Cedar Rapids. It will include a 259,000-square-foot, rail-served warehouse that will allow shippers to distribute, consolidate or store their goods in “creative ways,” said Jeff Woods, director of business development at Travero (formerly Alliant Energy Transportation), a subsidiary of Alliant Energy Corp. (NASDAQ: LNT).
The logistics park is located five miles from the U.S. Highway 30/Interstate 380 interchange to serve trucks from not only Iowa but Minnesota and Illinois.
Rail service to and from the facility will be provided by Travero’s short-line subsidiary, the Cedar Rapids and Iowa City Railway Co. (CRANDIC), which interchanges with the national rail networks of the Union Pacific (NYSE: UNP) and Canadian National (NYSE: CNI) in Cedar Rapids and connects to the Iowa Interstate Railroad, which operates about 600 miles of track across Iowa and Illinois.
Travero Logistics, the firm’s freight brokerage arm, offers both last- and first-mile service to the site via truck.
Between 2014 and 2016, Iowa’s Department of Transportation and consulting firm Quetica carried out the groundbreaking Statewide Freight Transportation Network Optimization Strategy. One of the key recommendations from the study was to develop a logistics park in the Cedar Rapids area that will offer companies cross-docking, intermodal, transloading and warehousing services.
Cedar Rapids is located within a four- to five-hour drive to and from the nation’s largest Midwest freight transportation hubs of Chicago, Minneapolis and Kansas City, Missouri.
The network optimization study calculated that Iowa shippers that used a truck-to-rail cross-docking service at Cedar Rapids could save about $852 million a year in transportation costs in moving products throughout the U.S. and to seaports for export.
Numerous large and small manufacturers and food processors, such as 3M (NYSE: MMM), ADM (NYSE: ADM), Cargill, General Mills (NYSE: GIS), John Deere (NYSE: DE), Pella, PepsiCo (NASDAQ: PEP), Vermeer, Whirlpool (NYSE: WHR) and Winnebago (NYSE: WGO), are located within a 100-mile radius of Cedar Rapids.
By the time the network optimization study’s findings were published in 2016, Travero’s parent company, Alliant Energy, had already purchased more than 1,000 acres in land options from surrounding farms for an economic development “mega site” that included the planned development of a logistics park in the Cedar Rapids area.
Woods said Travero’s first facility in the Cedar Rapids logistics park will focus on goods movement between trucks and railcars, with the long-term goal of handling intermodal containers. Other third-party logistics services providers and shippers are welcome to set up operations in the logistics park, he added.
“We foresee ourselves bundling transportation modes to create supply chain optimization for shippers,” Woods said.