To deliver merchandise on the same day it is purchased requires holding inventory close to population centers. Amazon knows this and is investing in large physical spaces in San Bernardino County. This must be a good time to buy warehouse space and Amazon is taking a long term perspective. Using its customer database, it must be able to form an accurate prediction over what households in the greater LA area will demand. This is a nice example of how improvements in information technology increase the demand for real estate. The process feeds on itself. As Amazon customers in the LA area become more aware of what stuff they can buy with "same day" delivery, they will demand more stuff from Amazon and this will further increase Amazon's demand for warehouse space in the area. Perhaps, San Bernardino will enjoy a comeback? As rents for warehouses increases, do local home prices in the same area stabilize? Is there a law of one price for land?
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10/20/2012
Amazon Demands Land in San Bernardino
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Posted by: Lyna | 11/28/2012 at 10:37 PM
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