On Tuesday, July 14, Attorney Frank D’Amore moderated a panel discussion “Industrial Reset on I-78: Leasing, Pipeline, and Entitlement Risk in the Lehigh Valley” as part of a broader look at the Lehigh Valley State of the Market: How Industrial Demand, Housing Delivery and Municipal Decision-Making Are Reshaping Growth In Allentown, Bethlehem, Easton, and Beyond. The event was hosted by Bisnow, the world’s leading B2B platform serving the commercial real estate industry, and held at Prologis, a 354,000 square feet industrial space in Breinigsville. Here’s a recap of the event.
State of the Lehigh Valley Industrial Market
As vacancy rises and new supply competes for tenants, how owners, developers and municipalities are recalibrating industrial strategy along the region’s most important logistics corridor. Frank moderated a discussion featuring local development leaders John Pollock, Principal, Trammell Crow; Peter Polt, EVP, JG Petrucci Co.; Dan Gordon, Regional Development Partner, Hanover Company; and Jim Vozar, Owner & Principal, JVI.
Main points of their conversation included:
- Recovery Status: The participants discussed whether the market is in a true recovery. One perspective suggested it is a “selective reset,” where Class A industrial spaces are outperforming Class B and C spaces, indicating a differentiation in performance based on asset quality.
- Tenant Activity: Tenant behavior has changed, with more selectivity and patience as they navigate the larger inventory. There is a noted shift towards specialty buildings and longer lease execution timelines.
- Development Challenges: Several challenges in site development were highlighted, including increased site work costs, utility availability, difficulty in obtaining entitlements, and community pushback against industrial projects, especially larger developments.
- Future Outlook: The participants expressed optimism for the next 12 to 24 months, driven by positive absorption rates, a growing population base, and the strong logistics position of the Lehigh Valley. However, uncertainty remained around interest rates, geopolitical issues, and economic headwinds.
- Market Dynamics: The importance of early engagement with municipalities was emphasized as a way to improve developer-community relationships and streamline the approval process, despite ongoing challenges.
Overall, the discussion illustrated a complex landscape in industrial development characterized by both optimism for certain segments and significant challenges.
State of the Lehigh Valley Arts Community
Just weeks before the start of the region’s 2026 Musikfest, named the Best Music Festival in the U.S. by USA Today, President & CEO of ArtsQuest Kassie Hilgert addressed a myriad of ways the Valley is building momentum through arts and place. Currently ArtsQuest’s new Creativity Center in Southside Bethlehem is under construction, replacing the Banana Factory and increasing the footprint of the arts community. The new building will include classrooms, incubator spaces, performance venue area, and more. Additionally, she addressed the impact of Live Nation and digital music platforms on venues.
State of the Lehigh Valley Housing Market
The final presentation of the day centered around housing and community, a panel discussion entitled “Creating Complete Communities: Housing, Retail and Mixed-Use Dealmaking Across the Lehigh Valley.” Panelists included Matt Tuerk, Mayor, City of Allentown; Josh Taykowski, Chief Investment Officer, City Center Group; Zachary Jaindl
President & COO, Jaindl Enterprises; Nicholas Dye, Managing Member, D&D Realty; and Luke DeLuca, Managing Director, GREA. Andrea Brady, Market Leader at CLA moderated. Main points from this presentation included:
- Definition of a Complete Community: A complete community goes beyond just living; it should provide a “live, work, and play” environment.
- Housing Demand: There is a significant housing demand in the Lehigh Valley, with a reported shortage of about 9,100 housing units. The panel discussed the challenges of meeting this demand and the importance of fast-tracking housing projects to address the shortfall.
- Housing Strategies: Strategies mentioned included offering density bonuses for affordable housing and streamlining zoning processes to make development easier. The importance of public-private partnerships in facilitating affordable housing was also noted.
- Mixed-Use Developments: The importance of true mixed-use developments that engage various community segments was highlighted. Key criteria discussed included time usage, repeatability of visits, and the economic interdependence of different uses within mixed-use districts.
- Adaptive Reuse: The panel shared insights on adaptive reuse of older buildings, emphasizing the value of historic architecture in revitalizing communities. Creative solutions are needed to convert these buildings effectively.
- Parking and Accessibility: The meeting addressed parking issues, noting that while parking availability exists, there is a need for better walkability and community engagement to encourage people to explore and utilize local amenities.
Overall, the panel expressed optimism about the future of the Lehigh Valley, stressing the importance of continuing to welcome new residents and businesses to ensure sustained growth, safety and vibrancy.
Legal Support for Lehigh Valley developers
Last year, the Lehigh Valley economy reached $57.3 billion and was ranked as the No. 1 mid-sized U.S. market for new economic development projects. And it’s not just businesses and developers who want to be here; it’s people and families who are contributing to the housing shortage, as the Lehigh Valley housing market remains drastically tighter than the national real estate market.
Our hot take? The Lehigh Valley is poised for exceptional growth. To achieve that, it requires collaboration across multiple levels of leadership and through layers of old and new municipal codes, local and state governing bodies, funding opportunities, and permitting processes. The best path forward? Find a local trusted guide.
Our Real Estate, Land Use and Development attorneys have been supporting developers, investors, and municipalities through the Lehigh Valley since 1988. Reach out to our team for support with your next project.
