Cold storage construction is one of the fastest-growing industries on the market, and with good reason. Due to increased demand from various industries, the global cold storage construction market has been growing steadily each year since 2013. According to Vantage Market Research, the global cold storage construction market is estimated to be valued at $19.7 billion by 2030 with a CAGR of 11% from 2023 to 2030. This unprecedented growth is due to several factors, but perhaps the largest is the growing demand worldwide for fresh, perishable foods. With staggering growth comes trends and changes within the industry. We have recognized these changes at ARCO and met them with our innovative solutions.
Managing Risk
Construction, especially cold warehouse construction, is prone to market volatility issues. Developers are cautious about constructing refrigerated facilities because they are such an expensive endeavor. Throughout a construction project, delays and costs of materials can cause significant risk. At ARCO Design/Build, we offer a methodology that transfers the risk from the client to us. In other words, all associated risks associated with the project are transferred to us—the general contractor. This cutting-edge way of mitigating risk sets us apart from the rest and is one of the most significant benefits when choosing a design-build contractor.
Cost Certainty
Cold storage builders are not immune to the ever-changing global economy that has felt the increase in inflation over the past few years. With the growth of price fluctuations comes cost changes that can impact the buyer. In addition, the delivery method and many other factors can quickly increase the project’s cost far above the initial quote. At ARCO Design/Build, we give clients the assurance of providing a lump sum and the certainty of delivering their project within the defined scope and budget.
Access to Capital
Despite a solid increase in cold storage construction, access to capital costs more because of high interest rates. This increase is causing a pause in development activities; lending institutions are pumping the brakes on capital investments in select projects. S&P Global says this leads to “…a lot of frustration from cold storage users…because they are difficult buildings to underwrite and there’s a squishy capital market for them after they’re built.” Funding refrigerated facilities is no small feat. These facilities are often much more per square foot. Acquiring these facilities’ capital remains a challenge in today’s market.
Lead Times
Supply chain issues and other global events, such as demand, have caused increased lead times on many building materials across the board. This has had a significant impact on the construction of refrigerated facilities. These delays can significantly impact the building schedule and the delivery of a final product to a client. However, these lead times impact ARCO Design/Build less for several reasons. We have a national buying power that many companies simply cannot match. Our ability to sequence projects ensures progress from concept to completion, ensuring progress and keeping projects on time and within budget.
Inventory Management & Maximization
Many companies are looking to expand and maximize their inventory capacities rather than constructing entirely new facilities. The increased demand for cold storage facilities puts many companies in a challenging position to change their inventory space. We specialize in working with companies to expand the inventory space in their current facility through innovative solutions. One such solution is offering mobile racking systems that can increase inventory storage by up to 40%, allowing businesses to make the most of their existing spaces without the need for new construction.
Experience the ARCO Design/Build Difference
Not all cold storage builders can tackle the increasing demands of the industry like ARCO. We understand the unique challenges that cold storage industries face—contractors knowledgeable in specialized temperature management and scalable systems are a must. We are the cold storage contractor with an expert understanding of what it takes to design and build a state-of-the-art cold storage facility that will help your company succeed. The best part? We cover it all from start to finish. Our in-house resources design and build efficient, durable, and innovative cold storage solutions, delivering a quality project where you can immediately get to work. With early risk transfer and cost assurance, you’ll have the confidence to create the project you need. We’re the cold storage contractor who’s completed over 250 cold storage construction projects across the country. Learn more about ARCO’s cold storage solutions or contact us to begin your next project.
