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An Interesting Hurdle

Razors Edge

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...confronting self-driving trucks - real estate.

The prospect of self-driving trucks could further intensify a land grab near big cities, one that is already fueled in part by the increase in long-haul trucking during the pandemic.

Alterra Property Group LLC, a real-estate investor based in Philadelphia, said Monday that it has launched a partnership with autonomous-truck company Embark Trucks Inc. to buy property across the U.S.

Embark, which went public in November in a $5 billion deal, plans to commercially launch the first trucks using its software in Sunbelt states such as California and Texas in 2024. The autonomous trucks would drive on highways, then pass on the trailers to human-driven trucks for the final stretch of city deliveries.

To do that, Embark needs numerous so-called transfer hubs close to highways on the outskirts of cities to park and switch trucks. Under its partnership, the company plans to initially lease these sites from Alterra.

The emergence of self-driving trucks comes as Americans’ voracious demand for electronics, household wares and other goods during the pandemic has been boosting the amount of truck traffic. Truck operators need land near big population centers to store their vehicles.

But that land is scarce. For one, developers have been buying up outdoor facilities for use as e-commerce warehouses. And strict zoning rules mean that few sites qualify for truck storage.

“You can’t just put a truck anywhere,” said Alterra’s co-managing partner, Matthew Pfeiffer.

That “is creating a significant supply-and-demand imbalance,” said Leslie Lanne, executive managing director at commercial-property firm JLL.

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