Liberty Kicks Off 1.2 MSF Industrial Project in Lehigh Valley
- Oct 31, 2011
October 31, 2011
By Barbra Murray, Contributing Editor
Liberty Property Trust has kicked off development of a 1.2 million-square-foot industrial warehouse and distribution center at Lehigh Valley Industrial Park in Bethlehem, Pa. T he $62 million project will effectively kill two birds with one stone by providing new big-box industrial space to a thirsty market and reclaiming a brownfield site that was once home to the Bethlehem Steel Corp.
The Bethlehem project illustrates the uptick in spec industrial development that some observers detect in markets like Pennsylvania. Those looking for big space in the Lehigh Valley market are coming across only slim pickings
“Right now, you can’t find anything larger than 300,000 square feet, and we have prospects in the 500,000 to 1 million-square-foot range looking throughout the Mid-Atlantic,” Steve Bonge, a senior vice president with commercial real estate services firm Grubb & Ellis Co.’s Global Logistics Practice Group, told CPE. Liberty’s approximately 17 million-square-foot Lehigh Valley portfolio is near maximum occupancy.
Dubbed LVIP VII, the facility will be within a three-hour drive of Philadelphia, New York City and Baltimore and within a day’s reach of such top distribution markets as Boston, Cleveland, and Montreal. “The Lehigh Valley has been a target for businesses for many, many years,” Bonge said. “The market is great for regional distribution.”
Liberty also expects to attract tenants to the property through sustainable elements. Featuring a host of green elements, including wall and roof insulation and high-output T-5 lighting, LVIP VII will be a candidate for LEED and Energy Star certification. “It will save the eventual tenants 35 percent or more in energy costs when compared with traditional buildings–real operational savings prospects are seeking,” predicted Liberty Property Trust senior vice president Bob Kiel.
Construction of LVIP VII reflects the REIT’s strategy of refreshing its portfolio with newer assets and pruning those of a less recent vintage. To that end, the company sold 32 older assets totaling 1.4 million square feet in the Lehigh Valley for $124 million in May. On the acquisition side, in July, Liberty Property Trust acquired a 535,000-square-foot Class A property in Macungie for $32 million one day, and signed a long-term tenant to 63 percent of the space the next.