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Business Insider reports that Robert Peck, an analyst with SunTrust Robinson Humphrey, is saying that Amazon Fresh may be targeting the New York City metropolitan area for its grocery delivery service.

"Our belief stems from a planned and financed expansion into renovated warehouse facilities in NJ," Peck writes. "The previous tenant of the facility was C&S Wholesale Grocers. The facility will be less than 50 miles from all five NYC boroughs, southern Westchester, and most all of central NJ ... "We believe, based on our research, that a developer partner of Amazon has purchased ~1m square feet of warehouse space in a prime NJ location and raised capital to renovate and improved the facilities. Amazon is the planned tenant for the larger ~526k sq ft. facility, while the remaining ~ 401 k sq ft. complex, which houses refrigeration capabilities, remains vacant. It is our opinion that Amazon will be the tenant for the second building as well following the large capital raise by its partner to refurbish this unit capable of storing perishable goods (previous tenant was C&S Wholesale Grocers), and serve as its center for Fresh in the NY metro area."

Amazon has been testing its Fresh service in Seattle for five years, and recently brought the concept to Los Angeles, with plans for San Francisco later this year, leading some analysts to believe that it has figured out the economics of making it work.
KC's View:
Included in the economic calculations is the fact that Amazon doesn't need to make money on Fresh ... because it has discovered that when people use this service, they tend to buy more from Amazon overall.