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Lehigh Valley Commercial Real Estate Report for Q3 2022 is Released

By Colin McEvoy on December 5, 2022

Pages from the Q3 2022 issue of the Lehigh Valley Commercial Real Estate Report.

The latest issue of the Lehigh Valley Commercial Real Estate Report has been released, highlighting the growth of the region’s commercial real estate market and the expansion of several manufacturing firms in the Lehigh Valley.

With a record low vacancy rate of 3.8%, the Lehigh Valley’s real estate market grew to 145 million square feet, indicating a robust demand for space in one of America’s fastest growing markets, according to the report, which was released today.

Each quarter, the Lehigh Valley Economic Development Corporation (LVEDC) publishes a report that provides a detailed overview of industrial and office market activity and notable real estate transactions in the region. The newest edition covers data from the third quarter of 2022.

The digital version of the new issue can be downloaded here, and hard copies can be made available upon request.

The cover of the Q3 2022 issue of the Lehigh Valley Commercial Real Estate Report.

While average industrial asking rent rose to $8.70 a square foot, the price is nearly half the rate of properties in nearby northern and central New Jersey, according to the report. The 658,000 square feet of new industrial and flex space added to the market includes several key expansions of companies driving the Lehigh Valley’s position as a Top 50 manufacturing market.

“Lehigh Valley manufacturers are driving innovations in the life sciences, food production, high-tech sectors and more because of our location, talent, and other resources,” LVEDC President & CEO Don Cunningham said in the report. “It’s no wonder we’re seeing strong interest from manufacturers who want to be a be a part of that in the Lehigh Valley.”

The featured manufacturing companies that recently expanded include B. Braun Medical, which cut the ribbon on a $200 million expansion near its Bethlehem headquarters; Spot & Tango, which opened its first manufacturing facility near Allentown; and OraSure Technologies, which completed a 139,000 square-foot expansion near Bethlehem.

“B. Braun has had the privilege of being part of the Lehigh Valley community for 40 years,” Jean-Claude Dubacher, President & CEO of B. Braun Medical, was quoted as saying in the report. “This facility represents both our commitment to the Lehigh Valley and Pennsylvania, as well as B. Braun’s strategic objective of being a leading health care technology company.”

Another 6.4 million square feet of industrial and flex space is currently under construction in the Lehigh Valley, according to the report. This includes the expansion of Phoenix Tube, which is adding another production line and is hiring another 30 people.

Additionally, iDEAL Semiconductor announced a $3.4 million expansion at Ben Franklin TechVentures in Bethlehem. Highlighted in the report as a noteworthy project, iDEAL is developing technology that promises to deliver breakthrough levels of power efficiency, a game changer as America works to bring home semiconductor chip manufacturing.

In the office market, the most significant project under construction is Mohrbanc, the first in The Waterfront development in Allentown, according to the report. The construction comes as brokers are observing a “flight to quality” office space as workers return to in-person work.

Office vacancy rates lowered to 7.9% while rent was $15.74 a square foot, more than a 1% drop from a year ago. Among the employers entering the office market is National Kitchen & Bath Association, which moved its headquarters from New Jersey to downtown Bethlehem.

A critical driver of the Lehigh Valley’s growing economy is a skilled and agile workforce that employers value in a rapidly changing world, according to the report. Through community partnerships, the Lehigh Valley is producing and attracting quality employees.

The report also includes notable sales and leases in the Lehigh Valley from the third quarter of 2022. The largest sale was the $13.8 million transaction of 802, 1629, 1889 S. 12th Street in Allentown, while the largest lease was 453,000 square feet at 800 Willowbrook Road in Allen Township.

The Lehigh Valley Commercial Real Estate Report was designed by Michelle Chrin.

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