Lineage to Acquire and Build Cold-Storage Warehouses for Tyson in $1B Supply Chain Overhaul

Lineage, one of the world’s largest temperature-controlled warehousing providers, announced a major expansion last week, unveiling plans to acquire and develop six cold-storage facilities for Tyson Foods in a deal worth nearly $1 billion.

The agreement includes the purchase of four existing Tyson-owned facilities for $247 million and the construction of two new warehouses set to begin in the second half of 2025. According to Lineage, the deal will expand its network by nearly 130 million cubic feet of cold-storage space and solidify Tyson as an anchor tenant at the future sites.

Acquired Facilities and Workforce Integration

The four acquired sites—located in Olathe, Kansas; Pottsville, Pennsylvania; Rochelle, Illinois; and Tolleson, Arizona—total 49 million cubic feet of storage. Upon closing this quarter, Lineage will integrate over 1,000 Tyson employees into its operations. The existing warehouses will transition into multi-client facilities once the two new builds are completed between late 2027 and 2028.

Lineage President and CEO Greg Lehmkuhl emphasized that the company’s data-driven approach and automation capabilities are key to supporting Tyson’s modernization goals.

“Our leading global facility network and world-class automation expertise, combined with our proprietary data science capabilities, aligns really well with Tyson Foods’ objective to enable a faster, smarter and more integrated supply chain,” Lehmkuhl said during the company’s recent earnings call.

New Construction: Expanding Cold-Storage Footprint

The new warehouses will be built in key U.S. distribution hubs and will add more than 80 million cubic feet of capacity. Tyson will be the primary customer at these automated facilities, which Lineage will develop with an investment exceeding $740 million.

The initiative comes as demand for cold storage in the U.S. surges. According to a 2024 report from Colliers, rising consumer expectations and evolving food distribution models have driven vacancy rates down and prompted a wave of investment in new facilities.

Tyson’s Strategy: Cut Complexity and Emissions

For Tyson, the warehouse transition supports a broader supply chain reconfiguration. During an earnings call Monday, Chief Supply Chain Officer Brady Stewart said the shift will allow Tyson to store products closer to key customers, cutting transportation miles and lowering emissions.

President and CEO Donnie King said the changes are part of a long-term effort to simplify operations and reduce costs. “This transition will be a multi-year journey,” King stated. “But we believe this will generate around $200 million of annual savings at full completion, which is currently anticipated in 2030.”

Source: SupplyChainDive