LVEDC President & CEO Don Cunningham (right) moderated a panel discussion that included (left to right) John Callahan, Lynn Turner, and J.B. Reilly. (photo courtesy City Center/Marco Calderon)

Twenty years ago, the cities of the Lehigh Valley were an area of weakness for the Lehigh Valley, according to J.B. Reilly. Those days are over.

“The urban cores used to be our Achilles’ heel; today they are an area of strength, and a lot of that has to do with demographic trends and preferences,” Reilly, President of City Center Investment Corporation, said at a Brokers & Developers Council event hosted by the Lehigh Valley Economic Development Corporation (LVEDC) on May 31.

“What’s happening in the Lehigh Valley is really happening across America, especially in coastal cities,” he said. “Millennials are seeking an urban environment, and if you don’t provide it to them, they’re going to find it somewhere else. Fortunately, the Lehigh Valley is well poised at the right time to take advantage of this trend.”

More than 80 people attended the event, which was held on the tenth floor of City Center’s recently-opened Tower 6, a 12-floor Class A office and retail building in downtown Allentown.

“Something significant and special”

The event was held at City Center’s recently-opened Tower 6 building.

Reilly was part of a panel of experts discussing urban growth and change in the Lehigh Valley, as well as the factors that are attracting companies to downtown locations. The discussion was moderated by LVEDC President & CEO Don Cunningham.

In addition to Reilly, the panelists included John Callahan, Director of Development with Peron Development, and Lynn Turner, Senior Vice President & Chief Human Resource Office with the Lehigh Valley Health Network (LVHN).

While baby boomers were populating suburbs and building McMansions 20 years ago as part of a mass exodus away from the cities, Reilly pointed out millennials are now a much larger demographic than baby boomers, and they are increasingly seeking a vibrant urban environment, live-work options, and exciting restaurants and nightlife.

Cunningham said the downtown neighborhoods of Allentown, Bethlehem, and Easton have once again becoming the homes of corporate offices, knowledge workers, technology-based industries, and entrepreneurship.

“You don’t have to go to many other regions our size across Pennsylvania or the United States to see we are truly an outlier,” he said. “Something very significant and special is happening across all three of our cities as our downtowns grow.”

Twenty-five companies have moved into the urban office centers in just the last few years across the Lehigh Valley, bringing with them 2,315 employees to the downtown neighborhoods, Cunningham said.

A downtown renaissance

The Lehigh Valley’s urban cores now have more than 60,000 jobs, according to data from the cities’ ZIP codes in most recently available data from U.S. Census Bureau County Business Patterns, which goes up to 2016. That’s an increase of 7,000 jobs since 2012.

According to the Census data, employment now totals about 20,000 in the South Bethlehem zip code, while in Allentown, Easton, and North Bethlehem zip codes, employment figures are more than 13,000 each, Cunningham said.

Additionally, the Lehigh Valley’s cities are now are home to more than 2,800 small businesses (employing fewer than 20 people). Cunningham said the number of small businesses in the region’s urban core areas has grown by more than 50 over the last five years.

“What is going on in the downtowns across the Lehigh Valley is truly a renaissance,” he said.

Open space and entertainment

LVHN is one of the top employers in the Lehigh Valley. Turner said the health network hires more than 2,000 employees in the Lehigh Valley region every year. She said turnover rates have reduced and the number of new applicants have increased.

Callahan said the open space and entertainment amenities preferred by millennials were a strong consideration when Perron Construction developed Five10Flats, its new five-floor luxury residential building in south Bethlehem.

“Millennials not only want to live here in the Lehigh Valley, but are living here longer,” Callahan said. “… And we’ve talked a lot about millennials, but don’t underestimate the baby boomers and empty nesters wanting to live here as well. They also want to live where they can walk to nice restaurants or entertainment.”

Hard copies of the latest Lehigh Valley Commercial and Industrial Real Estate Report were also distributed at the event. LVEDC publishes and distributes the quarterly publication, which provides economic data on the region’s office and industrial markets. The most recent issue highlights data from the first quarter of 2018.

The panel discussion was LVEDC’s first Brokers & Developers Council event of the year. These events offer an opportunity to learn about a timely topic and discuss issues affecting real estate brokers, site selectors, developers, bankers, and other professions.