Regional logistics hubs, freight activity and industrial space demand: Econometric analysis

There has been a continuing interest among transportation researchers and the logistics industry in the relationship between the consumption of industrial space and freight transportation activity. With the growing importance of logistics and supply chain economics to global industries, firms organizing their industrial activities and locating their warehousing and operational centers must increasingly consider the availability, quality and cost of a range of transportation services. Accordingly, the development of logistics facilities in conjunction with regional freight transportation hubs has become an important element of the overall industrial economy, predicated on the notion that robust freight activity is a good indicator of the consumption of industrial space. In this study, we conduct an econometric analysis of a longitudinal data set consisting of twenty metropolitan markets observed annually from 1997 to 2007. From those results, we develop a methodology to score and rank metropolitan markets according to their potential for industrial space consumption based on macroeconomic, demographic, and freight flow variables.