ICE Shopping for Mega-Warehouses, Runs Into Local Resistance

Immigration and Customs Enforcement is snapping up big-box warehouses across the country to turn them into mass detention centers, dragging real estate owners and developers into a growing political firestorm.

ICE has identified as many as 23 warehouse sites nationwide that could collectively add more than 76,000 detention beds, according to Bloomberg, dwarfing previous expansion efforts that relied on tent camps and private prisons.

The federal government spent $172 million to buy two vacant industrial buildings it plans to convert into immigration jails and a third deal in El Paso could yield one of the largest detention facilities in the country if fully built out.

The real estate angle is hard to ignore. A Hagerstown, Maryland, warehouse — bought for $102 million — was previously owned by Fundrise. A $70 million cash deal in Surprise, Arizona, involved a property tied to Rockefeller Group. In El Paso, the seller was Flint Development, a Kansas City-based firm active in large-scale industrial projects.

None of the companies responded to requests for comment.

The buildings themselves are shells, at least when considering their eventual purpose. ICE needs contractors to retrofit them with cells, plumbing and security infrastructure, creating a pipeline of work for construction firms willing to take on politically radioactive projects.

Contractors have already been given tours and design layouts at more than a dozen sites, Bloomberg reported.

But resistance has become a defining hurdle in the strategy.

In Hagerstown, more than 200 protesters showed up in freezing weather, joined by Sen. Chris Van Hollen, who denounced the proposed detention center as inhumane. In Oklahoma City, Mayor David Holt said local warehouse owners backed out of talks with ICE after community pushback.

Several other deals have collapsed. A 550,000-square-foot warehouse in Ashland, Virginia, owned by a company controlled by Canadian billionaire Jim Pattison, was pulled from a pending sale after the owner learned the intended use. In Salt Lake City, the Ritchie Group said it would not sell or lease a warehouse targeted by ICE after protesters showed up at its offices.

Elsewhere, opposition has zeroed in on high-profile landlords. In Merrimack, New Hampshire, demonstrators protested at a warehouse owned by CBRE. In Chester, New York, residents packed meetings over a 400,000-square-foot building owned by a holding company tied to billionaire and former Trump adviser Carl Icahn.

The fight highlights the collision between federal immigration policy and local land use. While

ICE can potentially override local zoning rules, municipalities still control utilities and infrastructure, a pressure point that may slow or derail some conversions.

For developers and owners, selling to ICE might pencil financially, but the reputational and political costs appear to be rising fast.

— Holden Walter-Warner