UPS 2009 Annual Report Download - page 29

Item 1B. Unresolved Staff Comments
Not applicable.
Item 2. Properties
Operating Facilities
We own our headquarters, which are located in Atlanta, Georgia and consist of about 735,000 square feet of
office space on an office campus, and our UPS Supply Chain Solutions group’s headquarters, which are located
in Alpharetta, Georgia and consist of about 310,000 square feet of office space.
We also own our 27 principal U.S. package operating facilities, which have floor spaces that range from
about 310,000 to 693,000 square feet. In addition, we have a 1.9 million square foot operating facility near
Chicago, Illinois, which is designed to streamline shipments between East Coast and West Coast destinations,
and we own or lease over 1,100 additional smaller package operating facilities in the U.S. The smaller of these
facilities have vehicles and drivers stationed for the pickup of packages and facilities for the sorting, transfer and
delivery of packages. The larger of these facilities also service our vehicles and equipment and employ
specialized mechanical installations for the sorting and handling of packages.
We own or lease almost 600 facilities that support our international package operations and over 900
facilities that support our freight forwarding and logistics operations. Our freight forwarding and logistics
operations maintain facilities with about 35 million square feet of floor space. We own and operate a logistics
campus consisting of approximately 3.5 million square feet in Louisville, Kentucky.
UPS Freight operates 202 service centers with a total of 5.6 million square feet of floor space. UPS Freight
owns 140 of these service centers, while the remainder are occupied under operating lease agreements. The main
offices of UPS Freight are located in Richmond, Virginia and consist of about 240,000 square feet of office
space.
Our aircraft are operated in a hub and spokes pattern in the U.S. Our principal air hub in the U.S., known as
Worldport, is located in Louisville, KY. The Worldport facility consists of over 4.1 million square feet and the
site includes approximately 596 acres. We are able to sort over 350,000 packages per hour in the Worldport
facility. We also have regional air hubs in Hartford, CT; Ontario, CA; Philadelphia, PA; and Rockford, IL. These
hubs house facilities for the sorting, transfer and delivery of packages. Our European air hub is located in
Cologne, Germany, and we maintain Asia-Pacific air hubs in Shanghai, China; Pampanga, Philippines; Taipei,
Taiwan; Hong Kong; and Singapore. Our regional air hub in Canada is located in Hamilton, Ontario, and our
regional air hub for Latin America and the Caribbean is in Miami, FL.
In 2009, we completed the first phase of our Worldport expansion, which increased the sorting capacity of
the facility by 15%. The final phase of the Worldport expansion will be completed in 2010, and will increase the
sorting capacity to approximately 416,000 packages per hour. The expansion involves the addition of two aircraft
load / unload wings to the hub building, followed by the installation of high-speed conveyor and computer
control systems. The overall size of the Worldport facility will increase to 5.2 million square feet. The total cost
of the expansion approximates $1 billion.
Over the past several years, UPS has made a successful transition to become the first wholly-owned foreign
express carrier in China. In 2008, we opened the UPS International Air Hub at Pudong International Airport,
which was built on a parcel totaling 1 million square feet with a planned sorting capacity of 17,000 packages per
hour. The new hub links all of China via Shanghai to UPS’s international network with direct service to the
Americas, Europe and Asia. It also connects points served in China by UPS through a dedicated service provided
by Yangtze River Express, a Chinese all-cargo airline.
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