Lehigh Valley Commercial Real Estate Report Now Includes Cost of Living Information
By Colin McEvoy on November 20, 2018
The latest issue of the Lehigh Valley Commercial Real Estate Report, a quarterly publication providing economic data about the region’s office and industrial markets, has just been released.
Written and published by the Lehigh Valley Economic Development Corporation (LVEDC), the latest report highlights data from the third quarter of 2018. A digital version can be downloaded here, and hard copies of the eight-page report are available upon request. A metric version is also available.
For the first time, the report now includes cost of living information, comparing the affordability of the Lehigh Valley to that of other markets in the Northeast.
The Lehigh Valley is 127 percent more affordable than Manhattan, 68 percent more affordable than Brooklyn, 43 percent more affordable than Boston, and 17 percent more affordable than North Jersey, according to data in the report from the Council for Community and Economic Research.
Among the other findings in the Lehigh Valley Commercial Real Estate Report are that the urban centers of the Lehigh Valley are continuing to drive office space construction in the region.
“The Lehigh Valley office market continues to be very strong, especially in the urban areas of Allentown with the NIZ and Bethlehem with the CRIZ,” said Cindy McDonnell Feinberg, Principal with Feinberg Real Estate Advisors, one of several regional experts quoted in the report.
“New urban buildings are leasing at a rapid rate as businesses are looking for incentives and unique designs,” she said. “Interest in the new federal Qualified Opportunity Zones is bringing additional attention to the Lehigh Valley with developers and investors expressing interest in available properties.”
The Lehigh Valley has seen 281,300 square feet of deliveries to the office market so far in 2018, and 270,000 square feet of that amount is Class A office space that has been built in urban cores of the region, according to the report.
There is 303,800 square feet of office space currently under construction in the Lehigh Valley. The regional office market has a total inventory of 27 million square feet, of which 6.9 million square-feet (or roughly 25 percent) is Class A office space.
The report also finds the Lehigh Valley’s industrial market continues to grow, reaching 121.2 million square feet as of the third quarter of 2018.
There have been 2.7 million square-feet in deliveries this year so far, and another 4.9 million square feet are currently under construction, according to the report. Out of 12 industrial buildings currently under construction, only five will be greater than 300,000 square feet in size.
Of the industrial buildings greater than 300,000 square feet in the Lehigh Valley, only 12 percent are used for traditional warehousing, according to the report. Sixty-two percent are being used for distribution or fulfillment, supporting the rapid movement of goods within business supply networks or directly to consumers who purchase items online.
“As we closed the third quarter, the Lehigh Valley continued to present a healthy industrial real estate sector,” Brian Knowles, Principal with Lee & Associates of Eastern Pennsylvania, said in the report.
“The new inventory of industrial space under construction should place the broader Lehigh Valley in a great position to continue its ability to support the corporate demand, which views this area as a viable operational point to service their clients and support growing operations,” Knowles said.
The Lehigh Valley’s unemployment rate as of August 2018 has dropped to 4.2 percent, compared to 5.0 percent a year earlier, according to the report. That is roughly consistent with the national unemployment rate of 3.9 percent, and the Pennsylvania rate of 4.1 percent.
“The Lehigh Valley’s gross domestic product reached a record-high $40.1 billion for 2017, and growth in manufacturing was responsible for about 36 percent of that year-over-year GDP increase,” LVEDC President & CEO Don Cunningham said in the report. “The Lehigh Valley is unique among major metropolitan areas in the United States in that manufacturing is driving such a large percentage of its growth.”
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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