Amazon Pilots Hyperlocal ‘Retail-Style’ Delivery Hub in Seattle, Signaling a New Phase in Ultrafast Logistics

Amazon is getting ready to test a new rapid-delivery model in Seattle’s Ballard neighborhood. This marks a meaningful change in the company’s aim to offer delivery in under one hour. Permit filings and internal documents show that Amazon plans to transform a closed Amazon Fresh Pickup site into a small, retail-like delivery hub specifically designed for quick handoffs to Amazon Flex drivers.

Called ZST4 in the filings, the facility will operate like a convenience store without any customers inside. Amazon staff will pick and pack online orders out of sight, place the bags on shelving in front, and hand them over to Flex drivers who will arrive regularly. Each driver is expected to be on-site for about two minutes.

While Amazon has tested many fast delivery models in recent years, this hub represents a significant change by combining the layout of a small retail store with the logistics of a micro-fulfillment center. It gives a glimpse into Amazon’s evolving fast-delivery plan as competitors like GoPuff, DoorDash, and Uber Eats also seek to redefine convenience in urban areas.

A Store with No Shoppers: Amazon’s Latest Logistics Experiment

Permit documents describe the Ballard site as running “like a convenience store,” but the “customers” will be Flex drivers acting on behalf of residential shoppers. The store analogy appears often in the filings and serves multiple purposes. It explains how the site will operate and could also help Amazon classify the facility within the existing retail zoning.

Inside, the workflow will be simple. Amazon employees will gather items from a small stockroom, bag the orders, and display them on shelves near the entrance. Flex drivers will then enter, scan their info, pick up the order, confirm the handoff with an Amazon staff member, and leave—all within a tight two-minute window.

The facility will likely operate 24/7, ensuring a near-constant flow of quick pickups. Documents estimate around 240 driver dispatches daily, with peak times seeing 15 to 20 departures each hour.

Amazon plans to allow deliveries via e-bikes and scooters due to the small sizes of the orders and short distances. This approach puts the new test closer to common micro-fulfillment and dark-store models in dense cities in Europe and the U.S.

A Look into Amazon’s ‘Now’ Initiative

The internal project name for the Ballard site, ZST4, is part of a new category of delivery hubs tied to “Amazon Now,” a recently launched delivery option that offers short, under-one-hour timeframes for Flex drivers. Publicly shared screenshots from Flex driver groups suggest that similar hubs like ZST3 in Seattle’s University District and ZPL3 in Philadelphia have started showing up on the Flex platform, indicating a wider rollout in several cities.

These local hubs aim to fill a gap in Amazon’s logistics network. Not every same-day order needs a full-scale fulfillment center, but shoppers increasingly demand immediate service. Amazon Now seems to target the balance between speed and proximity, using urban storefronts or small warehouses to speed up dispatch while keeping operations compact.

This new model could also lessen the delivery load on larger same-day facilities that manage a wider range of goods and cover larger areas.

Amazon Joins the ‘Sub-Same-Day’ Race

Recently, Amazon has invested heavily in what logistics experts call sub-same-day delivery. This term refers to a speed level between standard same-day shipping and the near-instant service offered by app-based convenience brands. This has become one of the most competitive areas in last-mile delivery.

Companies like GoPuff, DoorDash, Uber Eats, Glovo, and FreshDirect have all tried different quick-commerce models, usually employing small storefronts or warehouses stocked only with essentials. The model has seen mixed results globally, with some companies growing quickly while others closed after struggling to make it financially viable.

Amazon’s effort to boost profits with smaller delivery hubs reflects what they learned from previous projects, like Prime Now and Amazon Fresh local delivery sites. These offered quick delivery of groceries and essentials but involved significant operational costs.

The new retail-style model looks to simplify those aspects. Instead of sending Flex drivers to malls or partner stores—where unpredictable delays and labor costs could arise—Amazon is taking control of the entire process: inventory storage, order picking, handoff, and delivery.

Learning from Past Attempts – Including What Didn’t Work

This isn’t Amazon’s first attempt at super-fast, small-order delivery. In late 2024, the company stopped Amazon Today, a same-day service where Flex drivers picked up orders from physical retailers and malls. Reports indicated that the program failed because drivers often left with only one or two items, which was inefficient compared to warehouse-based order packing.

Experts say those issues highlight the main challenge of ultrafast delivery: each order is small, often low-value, and needs to be delivered very quickly. This combination often leaves little room for profit.

By running its own retail-style handoff site, Amazon gains better control over:

  • inventory flow
  • staffing
  • product availability
  • driver timing
  • building layout
  • handoff speed

Logistics analyst Marc Wulfraat, who tracks Amazon’s operations, pointed out that the Ballard site is similar to earlier Prime Now and Amazon Fresh delivery hubs, with one main difference. By labeling it as a “store,” Amazon suggests a hybrid model that combines retail and fulfillment aspects. He believes the company may stock both perishable and non-perishable items, aligning with Amazon’s recent efforts to integrate fresh groceries into same-day deliveries.

Wulfraat sees this new concept as an active experiment. “These are lab models to determine if the economics can work,” he said, noting that low-value orders and tight delivery windows can quickly cut into profits.

Inside the New Site: A New Purpose for an Experimental Building

The building at 5100 15th Ave. NW has been a testing site for Amazon previously. It was originally one of only two Amazon Fresh Pickup locations in the U.S., opening in 2017 as a drive-up grocery and package-return spot for Prime members.

That experiment ended in early 2023 when Amazon decided to withdraw from several physical retail initiatives. Along with other retail projects, the Ballard pickup location was closed. Since then, the space has sat empty—but not for long.

Now, Amazon plans to staff the hub with four shifts of six to eight employees each, totaling about 24 to 32 workers daily. These jobs will involve picking orders, staging deliveries, confirming driver pickups, restocking shelves, and monitoring inventory.

What the space won’t allow is traditional foot traffic. No customers will shop there, nor will there be any in-person returns or pickups. This aligns with the growing trend of “dark stores,” which resemble retail setups but serve only as logistics hubs.

Zoning Strategy: Why Amazon Keeps Calling It a Store

There’s also a regulatory angle to the “store” description that goes beyond branding.

The site is zoned for auto-driven retail and service businesses. When Amazon changed the old restaurant building in 2016, it received a permit that categorized the space as a retail store for general sales and services. If the city decides that the new model still qualifies as such, Amazon could avoid a formal change-of-use review.

This is important because a change-of-use review could prompt:

  • new traffic studies
  • environmental assessments
  • accessibility upgrades
  • building code updates
  • longer timelines and higher development costs

Amazon’s filings emphasize retail language throughout, calling Flex drivers “customer representatives” and suggesting that the front-of-house shelving area is a spot where “customer-selected products” are available. This wording is unusual for a delivery hub but could help expedite the regulatory process.

This distinction might also create a template for similar Amazon sites in other cities, especially in areas where officials have begun regulating or banning micro-fulfillment centers in prominent retail areas. Cities like New York, Amsterdam, and Paris have pushed back against dark stores due to concerns about pedestrian traffic, aesthetics, and compliance with retail zoning rules. Amazon’s retail-focused model may help it navigate challenges in those locations.

Economic Potential – and Unanswered Questions

For Amazon, the aim is clear: speed up deliveries while managing costs and minimizing disruption. However, it remains uncertain whether ultrafast delivery can be scalable.

Key challenges include:

  • the small size of each order
  • the cost of staffing multiple shifts
  • operating 24/7
  • vehicle turnover in busy neighborhoods
  • how much customers will pay for speed

At the same time, consumer expectations keep growing. Shoppers increasingly expect items—like snacks, chargers, and toiletries—to be available almost instantly.

If Amazon’s Ballard test proves successful, it could create a model for quickly setting up similar storefront-style hubs in cities nationwide.

What Comes Next

Amazon has not yet commented publicly on the project or announced a timeline for opening the Ballard site. The approval process is still in progress, and more details may emerge as construction moves forward and additional Amazon Now sites appear in the Flex network.

However, the direction is clear: Amazon believes that the next leap in e-commerce isn’t just fast shipping, but ultrafast, hyperlocal service tightly integrated into urban neighborhoods. The Ballard hub may be small, but it signifies one of the most ambitious moves in Amazon’s changing logistics strategy.

Article

Source: geekwire.com

About author