Tuesday, April 2, 2019

Philadelphia's Lehigh Valley Retail Submarket Maintains Growth and Momentum

Close to 20,000 square feet of retail space in Trexlertown was filled this week, after signing three tenants to move into vacant spaces in the suburban Philadelphia suburb.

The new tenants include the Pittsburgh-based Steel City Gyro, Mavis Tire and Supply and Active Learning Center.

The uptick in leasing interest is partly due to the nearby Hamilton Crossing, a fully occupied shopping center leased to major tenants including Dick’s Sporting Goods, Target and Whole Foods. The center has spurred additional retail interest across the area.

Hamilton Crossing’s success and Trexlertown’s growth are positive signs for the Lehigh Valley market, which continues to maintain growth and momentum. The market’s retail vacancy rate is under 4 percent, and unlike nearby central and northeast Pennsylvania markets, developers haven’t shied away from bringing new space to the market.

Nearly 2 million square feet of new developments has been added to the market since 2010, during a period when new growth was slowed across the country. Further bolstering the region’s forecast are strong economic and population growth tailwinds. The Lehigh Valley market has a high concentration of wealthy suburbs with average annual incomes over $100,000 and strong buying power. The region has added close to 40,000 jobs since 2010, while the nearby Scranton and Reading markets have only added about 30,000 jobs combined.

New residents have flocked to the area due to the increase in jobs, and Lehigh’s population climbed to nearly 20,000 since 2010. Downtown Allentown’s revitalization has attracted national attention, and the area is also building up trendy, modern multifamily communities.

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