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COVID Vaccine Refrigeration Demand Implications on Manufacturing and Real Estate

As of this article, two vaccines have been announced and plans for mass production and distribution are underway. This is great news for the real estate world as we move towards a future that supports place and space. It is also an opportunity for logistics driven real estate to step in and support the distribution efforts. What does this mean for Manufacturing? Opportunity for diverse products.



What We Know Right Now

The two vaccines that are rolling out require subzero cold-chain transportation infrastructure including planes, trucks, and storage facilities to keep the vaccines viable. According to JLL, a real estate brokerage firm, 2% of the overall logistics warehouse market consists of cold-storage facilities. The vacancy rate for existing cold storage facilities is less than 5% according to JLL and 3% according to competing Cushman.


With the lack of existing infrastructure, Pfizer’s short-term distribution plan is to use “just-in-time” strategies which means, limited distribution locations. Of course, long-term, this will not reach all who want the vaccine and ‘temperature controlled’ real estate will have to step in and step it up.

The US Department of Health and Human services released “The Operation Warp Speed strategy for distributing a COVID-19 vaccine” to illustrate the high-level path of the vaccine.


But What Does that Really Mean for Distribution, Storage & Real Estate?

As you can see from the diagram below, “Logistical Implications of Cold Chain Requirements”, the largest opportunity for real estate and manufacturing sits within the expansion of Warehousing in key distribution points, further afield from existing airport hubs. From the network of those new locations, “just-in-time” strategies will serve the larger nation.


How do we keep our development in check without over building or developing over specialized facilities? The price point and equipment availability are the two limiting factors which will appropriately hamper over development for the vaccine distribution channels. A combination of freezer farms, warehousing with cold storage and last mile solutions will be the project mix that will deliver vaccines all over the nation.


“There is a huge opportunity to fill this need with existing buildings and warehousing. Once a survey has determined that an existing space can be converted, we recommend either utilizing the existing roof framing structure to suspend the new cold storage ceiling panels or in some cases, ground mount all of the new wall and ceiling cold storage panels.“ – Brian Sielaff, P.E., CEO, Tamarack Grove Engineering


Who will be Developing this Infrastructure?

“UPS is working to build out a freezer farm in Louisville, Kentucky, that will help with the distribution of the vaccines, according to Bloomberg.


FedEx has highlighted its airplane fleet of 600 and 90 cold storage facilities around the world.” Leonard, Matt. “What we know about Pfizer’s coronavirus vaccine distribution plan.” Supply Chain Dive. 11 November 2020.


Cold Storage developers as well as warehouse developers will be key in creating the infrastructure needed beyond the major hubs where UPS and FedEx are focused. These developers have been building to meet the growing demand in grocery delivery from the last 8 months.



“Turn-around time will be the biggest challenge. It is critical that all team members are working in partnership including building owners, engineers, general contractors, local municipalities and manufacturing companies to ensure that all codes are being met and that schedules are being fulfilled.“ – Brian Sielaff PE, CEO, Tamarack Grove Engineering

Conclusions: Opportunity & Innovation

A variety of real estate and design approaches will be required to build out the infrastructure needed for the vaccine deployment, which means there is great opportunity for innovation and “being the first”. It would be very strategic for the manufacturing temperature-controlled world to focus on how to respond to this present need. Being both responsive and proactive in this time versus reactive will ultimately make or break the opportunity for any one company.


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