LVEDC Releases Inaugural Issue of New Quarterly Lehigh Valley Real Estate Report
By Colin McEvoy on May 19, 2015
In keeping with one of its core principles to serve as the leading source of economic data and market intelligence on the region’s economic assets, the Lehigh Valley Economic Development Corporation (LVEDC) has launched a new series of quarterly reports about the real estate climate of the Lehigh Valley.
Each issue of the Lehigh Valley Commercial Real Estate Report will focus on a different aspect of the region’s real estate market. The first issue, available in hard copy and digitally, focuses on the region’s office market, while future editions will focus on other markets like industrial and flex/warehouse.
“It’s been a goal of mine for LVEDC to provide research and data that help us all of us to better understand the Lehigh Valley economy,” said Don Cunningham, president and CEO of LVEDC.
“The only way to affect tomorrow is to understand where we are today and how we fit into what is happening across the nation and the globe,” Cunningham said. “We have hired a communications and research team that now gives us the expertise to produce these reports.”
Among the findings from the first eight-page report is that the Lehigh Valley commercial office market is showing signs of improvement, and compares favorably to the national office market. The Lehigh Valley’s overall office market vacancy rate is 11.8 percent, compared to 15.8 percent nationally.
“We haven’t seen these many positive signs in the region’s office market in years,” said Jody King, vice president at CBRE, one of several local experts who contributed a “Broker Perspective” to the commercial real estate report.
“Continuing job growth and a relative lack of new construction, other than in downtown Allentown, has supported a long-awaited increase in office rents for many owners,” King said. “Though there is still a significant amount of office space that is languishing unoccupied, the competition from tenants for top-quality office space is strong as the recovery gains momentum. Because of this, we are beginning to see developers move closer to starting construction on new offices.”
The report was publicly released for the first time at the LVEDC Brokers and Developer Council event on May 13, in which a panel of experts discussed the state of the Lehigh Valley office market.
It includes such information as the Lehigh Valley’s total rentable building area (24.25 million square feet), the total average rate ($19.82), rentable building area under construction for the first quarter of 2015 (216,000 square feet) and a breakdown of net absorption by quarter.
It also lists the distribution of office space by municipality, as well as a breakdown of the region’s 1,325 office buildings by class (50 are class A, 567 are class B, and 708 are class c).
Additionally, the report includes a list of all industrial and commercial real estate transactions recorded in Northampton and Lehigh counties during the first quarter of 2015 that sold in excess of $1 million. It also features a map showing the distribution of those sales, which reveals they are spread fairly evenly throughout the Lehigh Valley, not concentrated in one particular area of the region.
In addition to office market data, the report includes current economic data such as employment by industry, growth rates, historical unemployment data, workforce growth and information about the Lehigh Valley’s gross domestic product, which at $34.3 billion is higher than that of the state of Vermont and 102 other countries in the world.
“Economic data like this is pertinent to understanding the overall business climate in the Lehigh Valley,” said Lea Glembot, LVEDC Vice President of Economic Development and Marketing. “The factors described in this report lead to a better understanding of the health and diversity of a regional business base.”
The data featured in the Lehigh Valley Commercial Real Estate Report was gathered by John Lamirand, LVEDC’s research specialist.
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