Roughly one in four rail carloads and intermodal units in the United States originates, terminates, or simply passes through the Chicago area, the only place in the country where all six Class I railroads meet. That convergence makes Chicago the nation’s rail hub and, in the same breath, its most expensive bottleneck. The region is now roughly five years into a $5.8 billion infrastructure program, called CREATE, spanning 70 rail and highway projects meant to untangle a chokepoint the entire national freight system has to route around.
The Hub and the Bottleneck Are the Same Place
Freight rail moves about 40 percent of US long-distance freight measured by ton-miles, more than any other mode, across roughly 90,450 miles of Class I track carrying an estimated 1.5 billion tons of goods a year. Chicago’s convergence of six railroads is what makes that network function, and it is also why a shipment can lose more time crossing the city than it spent getting there from three states away. The CREATE program’s grade separations and flyovers are projected to generate $31.5 billion in economic benefit and 44,000 jobs once complete, which tells you how much value is currently sitting in traffic.
The Triangle Absorbs What Chicago Cannot Process Cleanly
Indianapolis, Columbus, and Louisville sit downstream and adjacent to that bottleneck rather than inside it, served directly by CSX and Norfolk Southern intermodal terminals without needing to route through the congestion itself. Louisville adds its own multimodal layer on top: the Ohio River connecting to the Mississippi barge system, an international airport among the five busiest air cargo hubs in the world moving over 4.2 billion pounds of freight annually, and UPS Worldport, the largest fully automated package handling facility on earth, processing roughly 400,000 packages an hour a few miles from the interstate. Freight that needs rail access without Chicago’s delay finds it here.
A Region Built to Take the Overflow
None of this is a bet on Chicago’s problem getting fixed. It is closer to the opposite. As long as the nation’s rail hub carries more volume than one metro area can move cleanly through its own streets, the corridor immediately south and east of it, with its own direct rail service and none of the congestion, keeps absorbing the traffic that has nowhere faster to go. Logistics and transportation jobs already account for close to a fifth of regional employment in parts of this corridor, evidence that the volume has been arriving for a while, not that it might start.
Why This Matters for the Buy Box
Industrial space sited near intermodal-served corridors in this triangle captures freight decisions made in boardrooms hundreds of miles away, decisions driven by rail economics that have nothing to do with local sentiment and everything to do with avoiding the one bottleneck every other network has to plan around.
Draymoor Ventures is seeking cash-flowing workforce multifamily, sized between 4 and 70 units, across the Indianapolis, Columbus, and Louisville metros, priced to work on today’s rent roll rather than tomorrow’s projection.
If your property already houses the people keeping this region’s freight and manufacturing base running, we want to understand the deal.
Sources
Averitt, “Louisville, KY: A Strategic Hub for Growing Logistics Needs.” https://www.averitt.com/blog/louisville-logistics-hub