Lehigh Valley Commercial Real Estate Report Highlights Office Space
By Colin McEvoy on September 6, 2019
The latest issue of the Lehigh Valley Commercial Real Estate Report has been released, providing an overview of the regional industrial market as well as a detailed look the 26.8 million square feet of office space in the Lehigh Valley.
The new report, which covers data from the second quarter of 2019, provides a more detailed breakdown of the regional office market, separating owner-occupied buildings and medical space from the overall total, and providing vacancy rates and rent figures for each tier.
The Lehigh Valley has 18.9 million square feet of office space once owner-occupied is removed, according to the report. That figure drops to 16.2 million square feet when medical space is excluded, and further drops to 14.2 million square feet when buildings smaller than 10,000 square-feet are removed.
“We continue to see a strong demand for quality, well-located office space from existing Lehigh Valley businesses, as well as companies looking to grow and expand into the market,” Philip M. Schenkel, Executive Vice President, Associate Director with JLL, said in the report. “The demand is across all submarkets and product types.”
A digital version can be downloaded here, and hard copies of the eight-page report are available upon request. The report was published by the Lehigh Valley Economic Development Corporation (LVEDC). A metric version is also available digitally.
Industrial space in the Lehigh Valley has reached 122.9 million square feet, with a vacancy rate of 4.5%, according to the report.
The regional market has added 2.9 million square feet of industrial space in the last four quarters, including 1 million square feet in the calendar year of 2019 so far, and another 6.3 million square feet are currently under construction.
The average asking rent for industrial space in the Lehigh Valley is $5.57 per square-foot as of Q2 2019. Asking rates for industrial space greater than 300,000 square feet reached $5.01 per square foot this quarter, and have increased 5% year-over-year, compared to $4.77 per square-foot in the second quarter of 2018.
Kerry Wrobel, President of Lehigh Valley Industrial Park, Inc., was one of several regional experts quoted in the new Lehigh Valley Commercial Real Estate Report issue.
“Overall, LVIP continues to benefit from a strong industrial market,” Wrobel said. “Recent projects in LVIP VII have added close to 1 million square feet with developers constructing smaller buildings in the range of 40,000 square feet to 240,000 square feet. A large percentage of this new space has already been occupied primarily by manufacturers.”
The new issue highlights data from a recent CBRE research report that identified cold storage logistics as a subsector to watch in industrial real estate, and specifically identified the Lehigh Valley as a target market for this subsector. Cold storage logistics account for 2.8 million square feet of the region’s total industrial inventory.
The new Lehigh Valley Commercial Real Estate Report also included information about the region’s population change from 2010 to 2018. Lehigh County has seen an increase of 18,424 over that time, and Northampton County has seen a population growth of 7,113.
Lehigh and Northampton counties are two of only 20 Pennsylvania counties with to experience population growth over that span. Lehigh is the fourth-fastest growing among the state’s 67 counties, and the cities of Allentown, Bethlehem, and Easton are among only 12 of Pennsylvania’s 56 cities with a growing population.
“The economy and population of the Lehigh Valley are growing together as people come here and new businesses start here,” LVEDC President & CEO Don Cunningham said in the report.
“There is a direct connection between economic growth and population growth, because the biggest current factor in economic development is the workforce,” Cunningham said. “Through our new Made Possible in Lehigh Valley initiative, we are making sure people from outside the region know Lehigh Valley is a place where you can create a life, a business, or a career on your terms.”
The report also includes a table with recent notable commercial real estate sales and leases.
The data featured in the Lehigh Valley Commercial Real Estate Report was gathered by George Lewis, LVEDC Director of Research and Analysis. To obtain hard copies, contact Director of Communications Colin McEvoy at [email protected] or 610-266-3817.
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This article originally appeared in the August 22, 2019 issue of “LV Connections,” a quarterly newsletter LVEDC distributes to municipal officials in the Lehigh Valley.The[...]Continue to Next Page