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Drone deliveries: Coming soon to a property near you?

A growing number of  developers are exploring establishing drone delivery locations at their subu...

IMAGE: A Sparrow drone in use in the GTA by Drone Delivery Canada. Developers and CRE owners and managers are beginning to consider creating drone spots at some of their properties. (Courtesy Drone Delivery Canada)

A Sparrow drone in use in the GTA by Drone Delivery Canada. Developers and CRE owners and managers are beginning to consider creating drone spots at some of their properties. (Courtesy Drone Delivery Canada)

A growing number of  developers are exploring establishing drone delivery locations at their suburban multifamily, commercial and industrial projects, according to Michael Zahra, president and CEO of Drone Delivery Canada.

“These are the very forward developers who realize drones are here to stay and are only going to be significantly more in widespread use going forward,” he told RENX.

While once limited to remote areas, warehouse-to-warehouse deliveries by drone are now possible in suburban areas, depending on where they are located, he said. Current Transport Canada regulations “don’t allow us to fly over people,” meaning drone deliveries today are primarily from business to business.

One such suburban drone delivery deal the company has signed is with transport and logistics firm DSV Canada in Milton, Ont., just west of Toronto.

It enables DSV to deliver healthcare-related and other forms of cargo from its Milton warehouse to health, hygiene and home products producer Reckitt Benckiser approximately four kilometres away. The route includes transport over Highway 401.

Other customers have been signed and the deals should be implemented shortly, Zahra said.

Drone Delivery Canada investigates several sites

Several “big-name” real estate developers Zahra declined to name have asked Drone Delivery Canada to analyze proposed development sites to ascertain whether they are drone-friendly. If an analysis finds drones could fly in the airspaces, developers can then include that information in sales pitches.

“What we are seeing is visionary landlords are looking at building us into their new infrastructure or their existing infrastructure.”

Initial delivery deals for Drone Delivery Canada (FLT-X) were with remote and First Nations communities. However, it has started moving into suburban deliveries as Transport Canada regulations have softened.

“The technology is ahead of the regulations. We can do a lot more than we’re allowed to do.”

Regulators at Transport Canada and around the world are using a “crawl, walk, run approach” in which drone delivery usage has slowly migrated from remote to rural to suburban, Zahra said. As governments grow more satisfied with the data they collect, regulations are loosened.

While “you’re not going to see residential downtown Toronto deliveries any time soon by anybody,” drones can fly over roads, industrial buildings, green spaces and water, all of which makes drone deliveries possible for many suburban applications.

He predicts downtown areas could see drone deliveries within five years.

Pandemic speeds up drone deliveries

Before the arrival of the coronavirus pandemic, Zahra said, drone deliveries were mainly limited to hard-to-access remote areas or for time-critical shipments in which “time is lives in healthcare, or time is money.”

The pandemic has led to an increase in drone deliveries, which limit person-to-person contact to avoid cross-contamination between hospitals and medical labs.

For developers, Zahra said drone delivery spots could be seen as revenue opportunities, and perks provided to tenants.

To enable drone deliveries, developers need to supply a footprint of about 30 to 35 feet for the drone spot.

Akin to mini airports, the spots are typically walled-in areas on building rooftops or at the edge of large, ground-level or multi-level parking lots. Four to six parking spots have to be given up to make way for a drone spot.

Developers begin preparing for drone spots

At a session on industrial real estate during the Montreal Real Estate Forum in October, developers were optimistic about the prospect of establishing drone delivery spots at their sites.

The growth of e-commerce will lead to an increase in traffic jams caused by delivery trucks, said Steven Bouffard, executive director, leasing, office and industrial at Cominar REIT. “The drone is one of the solutions to this growing problem. Drones will reduce the amount of parking required and allow for more densified development.”

There are fewer barriers to entry for drone delivery than for delivery by autonomous trucks, noted Charlie Deeks, chief investment officer of Pure Industrial. “This is the way of the future,” he said.

However landlords with existing properties, or properties or in development “need to figure out how they come to grips with this” to make drone deliveries work, said Sam Tsoumas, partner at RoseFellow.

“Incredibly reliable” Sparrow drones

Zahra said pricing for the managed service is on a case-by-case basis and ongoing operating costs are negligible.

Drone Delivery’s logistics solution includes a proprietary software system and hardware. The company mainly uses an electric drone called the Sparrow, with a maximum range of 30 kilometres and maximum payload of 4.5 kilograms.

“They’re incredibly reliable,” Zahra said of the drones, noting there have not been any malfunctions during deliveries.

Clients pay a one-time charge to install the infrastructure and a monthly flat fee that includes flight monitoring from the operations control centre.

Access to the depots is restricted and security cameras ensure it’s safe for drones to take off or land. As for other types of deliveries, bar code scanners allow for notifications, tracking, proof of delivery, etc.

Zahra recommends clients name one point person to administer the software and load and unload cargo at drone spots.

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