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Lehigh Valley Economic Development - 2016 Annual Report

  1. Come here. Start here. Grow here. 16ANNUAL REPORT
  2. In March 2017, Site Selection magazine ranked the Lehigh Valley among the top five regions in the Northeastern United States for economic development, along with New York City, Philadelphia, Pittsburgh, and Boston.
  3. LVEDC ANNUAL REPORT • 2016 3 As I conclude my final year as chairman of the LVEDC board, I’m pleased to say the Lehigh Valley economy is strong and diversified, and the organization is on the right track to continue to lead the region into an exciting and prosperous future. LVEDC is embarking on several important initiatives, including the Lehigh Valley Lending Network, a regional coalition of 17 banks that offer a single point of entry to private and public financing. This network is gaining attention as a potential best practice across the nation, having received national recognition from the CDFA in 2016. The organization has also been hard at work on developing current workforce supply and demand data through the LVEDC Education and Talent Supply Council. This is important, as the regions that best solve the talent supply equations will score the big wins in economic development competition. It’s been a pleasure to work with so many talented professionals in both the public and private sectors, all with the same goal of growing our region. I’d like to thank all of LVEDC’s many stakeholders for their continued support. It’s been another good year in economic development for the Lehigh Valley, and based on what we are working on in the pipeline, I don’t expect that growth to wane in 2017. The Lehigh Valley’s gross domestic product has reached $37 billion for the first time. That’s more than 97 countries in the world. Importantly, our economy is remarkably balanced, with our top four sectors all falling within $650 million of each other. Manufacturing is our top sector, making up nearly $6 billion – or 15 percent – of our total GDP. We have more than 680 manufacturers in the region with about 32,000 employees. We’ve tracked 31 business attraction/expansion projects announced, under construction or completed in the Lehigh Valley in 2016, creating 4,827 jobs and retaining 2,205 existing jobs. LVEDC also provided access to $240 million in financing in 2016, supporting more than a dozen projects that created 1,461 jobs. I’d like to thank the LVEDC Board of Directors and everyone who has played a part in helping LVEDC deliver on its mission of growing opportunity and creating jobs in the Lehigh Valley. Stephen C. Kalamar Board Chair Don Cunningham President & CEO The mission of LVEDC is to market the economic assets of the Lehigh Valley and to serve as a regional shared services and resource center to help businesses to come, start, and grow here.
  4. LVEDC ANNUAL REPORT • 201644 31% 24% 28% 17% TOTAL POPULATION 661,498 AGES 0-24 AGES 25-44 AGES 45-65 AGES 65+ Employment by Industry Health Care & Social Assistance 17.7% Retail Trade 10.9% Manufacturing 10.1% Accommodation & Food Services 8.1% Educational Services 7.9% Administrative & Support & Waste Management / Remediation Services 7.7% Transportation & Warehousing 7.7% 4,827JOBS CREATED BY 2016 BUSINESS DEVELOPMENT PROJECTS These job figures are projections, and some jobs will be created over the course of multiple years. Source: LVEDC Research Department 1,461JOBS CREATED BY 2016 LVEDC FINANCING PROJECTS 2,205JOBS RETAINED BY 2016 BUSINESS DEVELOPMENT & FINANCING PROJECTS Source: U.S. Census Bureau, 2015 American Community Survey 1-Year Supplemental Estimates *Industries below 7% are not included in this list Source: JobsEQ, Data as of Q2 2016
  5. LVEDC ANNUAL REPORT • 2016 5 Lehigh Valley GDP Reaches All-Time High *Data comes from the U.S. Department of Commerce’s Bureau of Economic Analysis (BEA). Gross domestic product (GDP) is the measurement of a country’s economic output. It is the total market value of all finished goods and services produced within a country’s borders in a given year. It includes all consumer, investment and government spending and exports, minus the value of imports. The $37 billion figure is for 2015, the most recent year for which data is available. $5.6B $5.5B $5.0B $4.9B $2.3B $1.7B $1.5B $1.5B MANUFACTURING FINANCE & REAL ESTATE EDUCATION & HEALTH CARE PROFESSIONAL & BUSINESS SERVICES RETAIL TRADE TRANS- PORTATION & WARE- HOUSING INFORMATIONARTS Lehigh Valley GDP by Industry Sector The regional GDP has increased by at least $750 million each year since 2010, when it was $31.34 billion Source: U.S. Bureau of Economic Analysis (BEA). The numbers above do not include government spending or other private industry subsectors for which data was unavailable or not disclosed by the BEA.s The Lehigh Valley GDP for 2015 ranks 73rd out of the 382 largest metropolitan statistical areas in the United States 34.1% Over one-third of the Lehigh Valley’s year-to-year GDP growth was attributed to manufacturing The Lehigh Valley’s GDP has reached a record high $36.97 billion,* a $1.6 billion increase over the previous year, with particularly impressive growth in manufacturing, which is now the region’s largest economic sector. Manufacturing now makes up $5.6 billion – or 15 percent – of the Lehigh Valley’s overall gross domestic product. The regional GDP is larger than that of 97 other countries in the world and the entire state of Vermont ($30.4 billion), and is only $1.7 billion behind the GDP of the state of Wyoming ($38.6 billion).
  6. LVEDC ANNUAL REPORT • 20166 Top 20% Nationwide for Patents and Innovation The Lehigh Valley ranks in the top 65 metropolitan markets in the nation for patent development, a key measure of an innovative economy. The region was awarded 1,348 patents between 2010 and 2013, ranking 61st out of 358 metropolitan statistical areas of any size in the United States. When compared to markets its own size, the Lehigh Valley ranks even higher, coming in at 21st among regions with a population between 200,000 and 1 million people. These rankings demonstrate that the Lehigh Valley has a long history of innovation and entrepreneurship that continues today. Source: LVEDC Research Department and U.S. Department of Commerce’s U.S. Patent and Trademark Office Best Post-Recession Job Growth in Pennsylvania For the third straight year, in 2016, the Lehigh Valley ranked highest among major metropolitan areas in Pennsylvania when it comes to post-recession job growth. The Lehigh Valley has 3.53 percent more jobs today than it did before the Great Recession began. That’s higher than eight other regions in the state with a population of 200,000 or more, and far exceeds the statewide average of 1.05 percent. This demonstrates the Lehigh Valley weathered the recession better – and recovered from it faster – than any major Pennsylvania region, thanks in part to the region’s highly balanced economy. Lehigh Valley 3.53% Statewide Average 1.05% Lancaster 2.77% Philadelphia/ Camden/ Wilmington 1.91% Reading 1.68% Harrisburg/Carlisle 1.37% Pittsburgh 1.31% York/Hanover 0.53% Scranton-Wilkes-Barre / Hazleton -1.14% Erie -3.78% Post-Recession job growth compared to the other eight Pennsylvania regions with a population of 200,000 or more. Source: LVEDC Research Department and U.S. Bureau of Labor Statistics’ Current Employment Statistics (Data as of April 2016)
  7. LVEDC ANNUAL REPORT • 2016 7 Lehigh Valley Lending Network The Lehigh Valley Lending Network continues to gain attention as a potential best practice across the country, having been awarded the prestigious 2016 Excellence in Development Finance Program Award from the Council of Development Finance Agencies (CDFA). The Lending Network is a revolutionary partnership between LVEDC and 17 Lehigh Valley banks that offers a single point of entry to both private and public financing. It streamlines the process for businesses seeking financing and new bank relationships, allowing them to simultaneously access and shop commercial lending institutions and economic development resource providers, all in one spot. Using the Network, an eligible borrower completes a series of forms outlining its business and financing needs, and the information is circulated to banks and economic development lenders based on the preferences of the borrower. Representatives of the selected lending organizations will then provide an expression of interest in working with the borrower that will outline the likely terms of a loan that could be offered. The Lehigh Valley Lending Network consists of 17 banks operating in the Lehigh Valley, including: “Many companies find it exhausting and difficult to find the right bank for their needs and understand the myriad of financing programs available. The Lehigh Valley Lending Network simplifies that process, allowing them to canvass many resources through a single inquiry and ultimately identify the best possible financing options for their specific needs.” – John Kingsley, LVEDC Vice President of Finance
  8. LVEDC ANNUAL REPORT • 20168 LVEDC Education and Talent Supply Council 2016 marked the first full year of an unprecedented partnership in the Lehigh Valley, including representatives from the region’s educational institutions, major employers, and economic development and workforce agencies. The LVEDC Education and Talent Supply Council has been hard at work on developing current workforce supply and demand data, and creating and executing regional strategies that help the region maintain a workforce and talent supply. In addition to LVEDC and the Lehigh Valley Workforce Development Board, this council includes representatives from the Lehigh Valley’s wide array of educational institutions including research universities, liberal arts colleges, community colleges, K-12 school districts, and career and technological schools, as well as major regional employers like Mack Trucks, Ocean Spray, and Olympus Corp. The council has begun to identify areas of focus to prioritize, discussing such topics as establishing internships, standardizing terminology in job descriptions to ensure more candidates are found, testing and verifying workforce data, and creating more intensive employer engagement. Council Gets Attention from Pennsylvania Legislature The Pennsylvania House Subcommittee on Technical Education and Career Readiness has turned to the LVEDC Education and Talent Supply Council for advice on how to connect educational institutions and major employers to address workforce and talent supply issues. This House subcommittee gathered testimony from LVEDC President & CEO Don Cunningham and Northampton Community College President Dr. Mark Erickson, and included their recommendations in a 60-page report to the full council on Nov. 30, 2016. In that report, the House subcommittee suggests other regions and workforce development entities should emulate the efforts of the LVEDC Education and Talent Supply Council. LVEDC ANNUAL REPORT • 20168
  9. LVEDC ANNUAL REPORT • 2016 9 LVEDC Familiarization Tours As part of our organization’s mission to market the economic assets of the Lehigh Valley, LVEDC hosted multiple familiarization tours with site selectors, commercial real estate brokers, and other business location decision-makers over the course of the past year. LVEDC organized a bus tour of the Lehigh Valley this summer for a group of registrants from “I.CON ‘16: Trends and Forecasts,” a major conference for the industrial real estate sector hosted in Jersey City by NAIOP, the Commercial Real Estate Development Association. LVEDC also organized separate familiarization tours with such prestigious global site selection firms as Biggins Lacy Shapiro&Company,LFMCorporateLocation Solutions, and Investment Consulting Associates. Showcasing our region to the people most directly involved in business location decisions could be the deciding factor in separating the Lehigh Valley from other regions on their shortlist. LVEDC is committed to strengthening the region’s visibility to those on the forefront of the site selection process. Tour participants came from 15 different states, as well as the country of Brazil. Companies represented included: • Baker Commercial Real Estate • CBRE • Cushman & Wakefield • Marmara • Port Authority of NY & NJ • Port of Portland • Prologis
  10. LVEDC ANNUAL REPORT • 201610 Attracting new businesses to the Lehigh Valley always gets bigger headlines, but it is equally crucial to help the companies already here grow and thrive. The biggest business retention success story of the year was Guardian Life Insurance opening a new office complex in Hanover Township, Northampton County, bolstering its already strong presence in the region. The three-story, 281,680-square- foot facility at 6255 Sterner’s Way consolidated Guardian’s previous regional headquarters that was spread across three buildings in Bethlehem and one in Allentown. One of the nation’s largest mutual life insurers, Guardian Life Insurance is one of 15 companies in the Lehigh Valley with 1,000 or more employees. The H-shaped office complex was designed to enhance work/life integration for employees, increase the ability to work collaboratively, and place all offices in the center of the building to maximize natural daylight and external views. Guardian is one of several companies – along with Paychex Inc., Olympus Corporation of the Americas, and others – that have opened, expanded, or consolidated back-office operations over the past year. High value business services is one of the region’s target sectors, and corporate employees staffing accounting, technology support, payroll services, customer service, transaction processing, and other functions are finding they prefer working in a location like the Lehigh Valley, where they can enjoy a quality of life unfettered by long commutes and the high living costs of larger cities. 10 “This building is both a testament to the future growth of our business and our commitment to the Lehigh Valley. As one of the largest employers in the area, it is our hope this new office complex will help to continue to attract talent from our local community by raising the bar on what employees should expect from their workplace.” – Deanna M. Mulligan, President and CEO, Guardian Life Insurance Company of America 69% THE AMOUNT OF JOB GROWTH IN THE LEHIGH VALLEY FROM THE PAST FIVE YEARS THAT HAS COME FROM EXISTING BUSINESSES Guardian Marks Region’s Biggest Business Retention Success Story
  11. LVEDC ANNUAL REPORT • 2016 11 Business Resource Guide “The BOP program provides a single point-of-contact for all of your business needs, and helps to identify resources to assist you in succeeding in today’s competitive environment. We’re available to meet with companies to discuss their operations, needs, and plans for the future.” – Melody Bradford, LVEDC Director of Business Outreach Programs 2016 saw the release of a new guide for helping businesses come, start, and grow here in the Lehigh Valley. The LVEDC Business Resource Guide provides information about how LVEDC can assist businesses with their needs, especially in the areas of financing, real estate, technical assistance, and labor and workforce. It also particularly highlights LVEDC’s Business Outreach Program (BOP), which uses a customer-oriented approach to economic development designed to link Lehigh Valley businesses to resources throughout the community that will help them become more profitable. The goal of the program is two-fold: providing a single point-of-contact for all of your business needs, and helping to identify resources to assist you in succeeding in today’s competitive environment. Businesses have often received assistance in workforce training and recruitment, exporting, strategic and business planning, financing, and more. The guide also touches upon technical assistance LVEDC can provide, highlights the organization’s redevelopment program, and discusses how regional companies can find the right talent and keep its workforce’s skills up to date, particularly with help from the Lehigh Valley Workforce Development Board (LVWDB).
  12. LVEDC ANNUAL REPORT • 201612 Company Amount Jobs Created* Jobs Retained* $122,500 700 - C&S Wholesale Grocers $50,000 600 - Everson Tesla $450,000 5 75 Hillwood Investment Properties $6,100,000 - - Hospital Central Services Corporation $2,250,000 38 180 J2 Properties LLC / Luxury Lane $1,843,000 12 18 MC421 LLC / Penn Sheet Metal $880,000 8 20 Michelman Steel Enterprises $1,750,000 17 27 PennFleet Corp $445,000 7 23 PPL Corporation $223,750,000 - - The Bug Company $960,000 41 0 Tyber Medical $362,500 25 - Vastex International $1,205,000 8 23 Vastex International $76,000 - - TOTAL $240,244,000 1,461 366 It’s been another successful year for LVEDC’s Finance Department which provides much-needed capital for companies looking to relocate, expand, or start in our region. LVEDC provided access to funding in excess of $240 million in support of investment in the Lehigh Valley that will exceed $350 million. These projects will lead to the creation or retention of more than 1,800 jobs.  LVEDC offers access to a wide variety of financing options and loan programs to address an array of business needs. Our staff offers a consultative approach to advising companies, not only on the resources we administer directly, but on a myriad of financing options available through traditional lenders and other public and non-profit resources, to maximize the benefit to our customers.  LVEDC works with our various partners to administer a wide variety of local, state and federal economic development loan and grant programs aimed at helping companies start, locate, and grow in the Lehigh Valley. These partners include the Northampton County Industrial Development Authority, Lehigh County Industrial Development Authority, the Northampton County Jobs Corp., Lehigh’s Economic Advancement Project, and the Allentown Development Company. *For privacy reasons, some companies declined to provide data about the number of jobs created or retained by its financing project. These job figures are projections LVEDC 2016 Financing Projects
  13. LVEDC ANNUAL REPORT • 2016 13 Featured Lehigh Valley Projects The Lehigh Valley is in the middle of an e-commerce explosion thanks to the region’s strong infrastructure, available land and workforce, and central East Coast location within a six-hour truck drive of one-third of the nation’s consumers. All those factors led, the largest Internet-based retailer in the United States, to announce plans for a new fulfillment center in the Chrin Commerce Centre in Palmer Township. The 1.1 million square-foot facility is one of seven warehouses built or planned for the Centre, an 800-acre facility for manufacturing, distribution, retail, and office space near the recently-opened Route 33 interchange. Amazon. com already operates two facilities in the Lehigh Valley, including a 615,000 square-feet building at 705 Boulder Drive and a 483,200 square-foot facility at 650 Boulder Drive, both in Upper Macungie Township. Foreign direct investment has been growing steadily in the Lehigh Valley. The region has long been a home to prominent companies from around the world, like Olympus and B. Braun, and 42 percent of the Lehigh Valley’s business projects in 2015 were international companies. In March 2016, the French bakery products company Norac announced it would establish its first American manufacturing facility in Forks Township, where it will make natural bakery snacks under the brand name Bakerly. Norac officials said the company was attracted the Lehigh Valley due in part to its central location, access to highways, and the “industrial and manufacturing culture in the region.” Norac selected the Lehigh Valley after LVEDC and Pennsylvania DCED officials embarked on a business development tour through Western Europe to attract foreign direct investment. Norac
  14. 212 212 476 476 Easton Bethlehem Allentown 412 412 222 22 22 22 22 78 78 78 78 78 145 191 32 611 33 611 145 145 145 248 248 33 100 100 309 309 378 378 248 248 191 512 946 512 946946 987 987 987 329 329 222 Lehigh Northampton Slate Belt 611 611 1 3 2 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3031
  15. Company Municipality Product New or Expansion Stage Type Investment * New Jobs Created* Jobs Retained* Square Feet Lehigh County 1 East Penn Manufacturing Lower Macungie Batteries New Under Construction Distribution - - - 650,000 2 Hospital Central Services Corporation Allentown Professional Services Expansion Complete HQ $10,500,000 38 180 21,000 3 Mack Trucks Macungie Transportation Equipment MFG Expansion Announced MFG $70,000,000 - - 4 Michelman Steel Enterprises Allentown Manufacturing Expansion Announced MFG $3,500,000 17 27 71,150 5 Nestle Purina Allentown Pet Food Manufacturing Expansion Under Construction Distribution - 30 - 53,000 6 Nihon Kohden South Whitehall Medical Electronic Equipment New Complete Office $445,000 27 - 7,000 7 Paychex South Whitehall Professional Services Expansion Complete Office $1,300,000 115 - 22,000 8 Penn Sheet Metal Allentown Fabricated Metal Products Expansion Complete MFG $1,985,000 8 20 35,400 9 Ryder System, Inc. (Verizon) Lower Macungie Telecom New Announced Distribution - 350 - 1,200,000 10 Seasons EVOO Bethlehem Food & Grocery Distributor New Complete Distribution - 10 - 25,000 11 Sharp Packaging Upper Macungie Pharmaceutical Packaging  Expansion Complete Distribution $45,000,000 50 - 112,000 12 Uline Upper Macungie Shipping Supplies Expansion Complete Distribution $200,000,000 - - 1,600,000 Northampton County 13 Palmer Twp E-Commerce New Complete Distribution $20,000,000 700 - 1,106,000 14 C&S Wholesale Grocers, Inc. Hanover Twp Food & Grocery Distributor Expansion Completed Distribution $1,290,000 600 - 621,500 15 Central Garden & Pet Lower Nazareth Pet Supply New Complete Distribution $884,000 40 - 243,360 16 DevTech Hanover Twp Plastic Bottles New Complete MFG $18,240,000 32 - 120,000 17 Ecopax Bethlehem Food Packaging Expansion Under Construction MFG $20,000,000 30 - 144,000 18 FedEx Northampton Distribution New Under Construction Distribution $335,000,000 700 - 1,100,000 19 FreshPet Bethlehem Pet Food Manufacturing Expansion Under Construction R&D - - - 50,000 20 FreshPet Kitchens Bethlehem Pet Food Manufacturing Expansion Complete MFG - 60 - 32,000 21 Guardian Life Insurance Co. of America Hanover Twp Insurance Expansion Complete Office $70,000,000 - 1,500 281,680 22 J2 Properties / Luxury Lane Easton E-Commerce Expansion Complete Distribution $4,480,000 12 18 43,000 23 Norac (Bakerly) Easton Food Manufacturing New Under Construction MFG $25,000,000 62 - 79,160 24 Reeb Millwork Corp Bethlehem Wholesale Millwork Expansion Complete MFG $38,000,000 147 267 175,000 25 Stitch Fix Hanover Twp E-Commerce (Apparel) New Complete Distribution - 500 - 483,900 26 Straight Arrow Products Bethlehem Miscellaneous Mfg. Expansion Under Construction MFG $2,300,000 30 72 15,000 27 The Bug Company Hellertown Pet Food Manufacturing New Complete MFG $1,600,000 41 - 47,500 28 Tyber Medical LLC Hanover Twp Medical Devices Expansion Announced Office/MFG $3,000,000 - - 29 Tyber Medical LLC Hanover Twp Medical Devices New Complete Office/MFG $386,000 25 - 4,200 30 Vastex Bethlehem Miscellaneous Mfg. Expansion Announced MFG $3,500,000 8 23 45,000 31 Zulily Bethlehem E-Commerce New Complete Distribution $43,600,000 1,200 - 820,250 For privacy reasons, some companies declined to provide data for its development project. These job figures are projections.
  16. LVEDC ANNUAL REPORT • 201616 Featured Lehigh Valley Projects Every truck manufactured by Mack Trucks for the North American market is built right here in the Lehigh Valley, and the company reaffirmed its commitment to the region in April 2016 with the announcement of about $70 million in improvements to its Lower Macungie Township plant. Designed to further improve manufacturing quality and efficiency and modernize the facility, the plant enhancements will include a 75,000 square-foot expansion to improve material handling and flow, new manufacturing IT systems, equipment and tooling, and a new building for conducting quality audits on completed vehicles. The investment plan also includes about $12 million in projects that were included in a separate $26 million upgrade announced in 2014. One of the region’s top employers, Mack Trucks employed about 1,900 workers last year at the Lehigh Valley facility, which produces 116 trucks a day. When the San Francisco-based Stitch Fix was seeking to open its first distribution center in the Northeast, it conducted an exhaustive search and concluded that the Lehigh Valley was the place to be. The online personal shopping service for women opened a 483,900 square-foot facility in Lower Nazareth Township in April 2016, a project that was expected to create more than 500 new jobs when fully operational. The company considered multiple states and settled on the Lehigh Valley due to its central location and high-quality workforce. Founded in 2011, Stitch Fix allows customers to visit its website and create a profile by answering a series of questions about themselves and their style preferences. The company then sends several items of clothing based upon the answers. Mack Trucks Stitch Fix
  17. LVEDC ANNUAL REPORT • 2016 17 Featured Financing Projects Everson Tesla, located in Lower Nazareth Township, is an advanced manufacturer of superconductor components, magnets, motors, coils and related systems for use in a varietyofmedicaldevices,powergeneration facilities and military applications. Thanks to a $450,000 PIDA loan, it is adding a 10,290 square-foot addition to its current facility in the Salvaggio Industrial Park, where its two existing buildings total 64,000 square- feet. The $900,000 expansion project has created new jobs and allowed the company to retain 75 existing positions. This is the company’s third PIDA loan. This steel fabricator manufactures structural steel for bridge and large building projects in the Northeast United States. The company was awarded a $1.75 million PIDA loan to acquire and renovate a 71,150 square- foot manufacturing facility in Bethlehem. Michelman Steel has expanded steadily since starting in the Lehigh Valley in 2012, and LVEDC has worked with them since its inception, helping to secure the 15-year loan at 2.25 percent interest for the first seven years. The new facility will be nearly three times the size of its previous location in Upper Macungie Township. A manufacturer of orthopedic and spinal implants, Tyber Medical has relocated its corporate headquarters and manufacturing operation from New Jersey to the Lehigh Valley, creating 25 new full-time jobs over a three-year period. This project is supported by a $362,500 loan that will be used to assist in acquiring machinery and equipment to support the manufacturing of the company’s products. Tyber is also seeking to grow by taking over an adjacent space and adding more manufacturing in-house, as part of a $3 million expansion project. Everson Tesla Michelman Steel Enterprises Tyber Medical LVEDC ANNUAL REPORT • 2016 17
  18. LVEDC ANNUAL REPORT • 201618 Redevelopment Program In 2016, the Lehigh Valley Land Recycling Initiative (LVLRI), LVEDC’s redevelopment program, experienced the busiest year in its nearly two- decade history, working on 21 active redevelopment projects in various stages. That’s far more than the average of about a half-dozen from previous years, and nearly double the benchmark of 11 projects in 2015, which was itself a record at the time. LVLRI is focused on promoting economic development through the reuse of abandoned and underutilized commercial and industrial properties, also known as brownfields. SIMON SILK MILL The Simon Silk Mill property in Easton is a long-running project which is about to come to life. First built in 1883, this former textile manufacturing site is poised to become a 300,000 square-foot live-work complex. A first wave of eight businesses for the project were announced this past summer, including a brewery and restaurant, fitness center, hair salon, makeup studio, photographer, event planner for nonprofits, and medical supplies distributor. LVLRI assisted with environmental assessments, cleanup planning, and redevelopment planning activities for this project. EASTON PUBLIC MARKET The Easton Public Market, a 16,000 square-foot indoor farmer’s market located at the former Weller Center, held its long-anticipated grand opening in April. A project of the Greater Easton Development Partnership, it features an on-site butcher, a farmstead, community spaces, a fishmonger, a demonstration kitchen, and the region’s first Asian noodle bar. LVLRI assisted with a Phase I environmental assessment for the project.
  19. LVEDC ANNUAL REPORT • 2016 19 An April 24 piece by Reuters focused on the Lehigh Valley economy, noting that the economy is stronger and more diversified than since the days of Bethlehem Steel’s closure. “Despite the steel industry’s decline, the area’s manufacturing workforce is slightly larger than the national average, with a growing food processing hub.” CNN Money selected Bethlehem for its list of “100 Best Places to Live and Launch” a startup company, touting it as a business-friendly environment in a university town. “The city welcomes new businesses with open arms, offering technical assistance, low-interest ‘gap’ financing, a tax abatement program, enterprise zone incentives, and a loan pool providing up to $2 million for new and existing businesses.” Money Magazine in October selected Bethlehem as one of the best places in the country in which to retire, ranking #1 out of all cities in the Northeast region. “There was a time when you couldn’t talk about Bethlehem without mention of Bethlehem Steel. … More than 20 years later, the city has managed to reinvent itself while holding on to its history.” InaDec.8story,thePhiladelphiaBusiness Journal noted the Lehigh Valley’s record- high GDP, revitalized cities, and growing international investment. “More than three decades after Billy Joel’s hit song aptly described the decline of American manufacturing and the cities of the Rust Belt in the latter part of the 20th century, the Lehigh Valley is singing a different tune.” Following the U.S. presidential election, The Guardian published a profile of the Lehigh Valley on Jan. 18, and took notice of the economic growth the region has seen in recent years. “Unlike the Pennsylvania coal country to the north, Northampton County has been adding residents in recent years instead of bleeding them, while incomes and home values have crept upward. Businesses have been moving in.” U.S. News & World Report has selected Allentown and the Lehigh Valley as one of the 2017 Best Places to Live, with high rankings in the areas of quality of life, job market, and value, desirability, and net migration. “A quiet architectural renaissance has blossomed in Pennsylvania’s third-largest metro area.” External Coverage of the Lehigh Valley Economy
  20. LVEDC ANNUAL REPORT • 201620 LVstartup This past summer marked the one-year anniversary ofLVstartup,amonthlye-newsletterabouttheLehigh Valley entrepreneurial and startup community. Written and distributed by the Entrepreneurship Council of the Lehigh Valley, LVstartup provides information about local events, news stories, and resources available to help entrepreneurs grow and thrive in the region. Released every first Thursday of the month, LVstartup is one of several ways LVEDC helps provide startups with important skills and valuable expertise, as well as helping entrepreneurs refine their business goals, identify their markets, hone their business plans, and locate start-up capital. . Lehigh Valley Commercial Real Estate Report One of the core principles of LVEDC is to be the leading source of economic data and market intelligence on the Lehigh Valley’s economic assets and resources to serve our economic strategies, marketing efforts, and the needs of our stakeholders. To that end, LVEDC prepares a series of quarterly reports about the real estate climate in the Lehigh Valley, focusing on the region’s office, industrial, and flex markets. With information provided by the LVEDC Research Department, the reports provide such information as vacancy rates, market conditions, net absorption, unemployment rates, workforce employment growth, and a list of all major sales transactions from the Lehigh Valley each quarter. The Lehigh Valley industrial market grew by nearly 7 percent over the course of 2016, reaching a total inventory of 113.6 million square-feet. The Lehigh Valley office market saw 356,338 square-feet in deliveries in 2016, for a total inventory of 25.6 million square-feet.
  21. LVEDC ANNUAL REPORT • 2016 21 LVEDC’s Award-Winning Video Series LVEDC produced a series of videos over the last year to help market the Lehigh Valley’s economic assets to the largest audience possible. These efforts have received international attention, earning LVEDC a 2016 Excellence in Economic Development Award by the International Economic Development Council (IEDC), the world’s largest and most prestigious organization serving economic developers. LVEDC received a Silver Award for Best Video/Multimedia Promotion for its entry from a series of six videos highlighting the target sectors of the Lehigh Valley economy. Filmed by the Emmy Award-winning FireRock Productions, these videos highlight the region’s high-performance manufacturing, life science research, food and beverage processing, and high value business services sectors, as well as redevelopment and the region’s entrepreneurial community. LVEDC also prepared a series of videos highlighting six distinct sub-regions of the Lehigh Valley: Allentown, Bethlehem, Easton, Lehigh County, Northampton County, and the Slate Belt. These videos accompanied websites, high-quality photography, and printed brochures from each sub- region. These campaigns, branded with the word Select (like “Select Northampton County” or “Select Lehigh County”) are targeting businesses and site selectors across the country. “Online video traffic is predicted to make up to 80 percent of all consumer Internet traffic in 2019. Internet users are consuming more video than ever before, and now is the perfect time to spread the word about the Lehigh Valley through this fast-growing medium.” – Michael Keller, LVEDC Director of Marketing
  22. LVEDC ANNUAL REPORT • 201622 New LVEDC Billboards If you’ve driven along Route 22 any time recently, you may have spotted some positive news about the Lehigh Valley economy. That’s because LVEDC has taken out two digital billboards along the region’s most heavily traveled highway to share such information as the record-high regional GDP or the growth in the region’s manufacturing sector. These billboards allow LVEDC to share economic news with the region quickly, provide new economic data and numbers as they come out, and thank investors who have helped LVEDC execute on its mission to recruit companies and grow jobs in the Lehigh Valley. International Marketing Materials With the importance of foreign direct investment growing in the Lehigh Valley, LVEDC has been distributing brochures and marketing materials in nine different languages and sending them to international companies all over the world. This includes a version of the materials in the Arabic language, which were released for the first time in 2016. These materials highlighting the Lehigh Valley’s economic assets have been sent to such countries as Australia, Brazil, Canada, China, France, Germany, India, Japan, Mexico, the Netherlands, and the United Kingdom. LVEDC website visits increased 21.04% from 2015 to 2016. LVEDC website total users increased 20.80% from 2015 to 2016. LVEDC Twitter impressions reached 1.1 million in 2016, a 377.39% increase over the previous year. LVEDC’s Facebook page saw a 388.2% increase in weekly total reach, and a 24.06% increase in total likes.
  23. LVEDC ANNUAL REPORT • 2016 2016 LVEDC Events LVEDC hosted numerous events over the past year that provided stakeholders the opportunity to learn about timely economic issues, hear from legislators and business leaders, and network with other professionals from throughout the Lehigh Valley. Below are just a few of these events: “Conversation and Cocktails” with U.S. Sen. Bob Casey During a visit to Easton’s State Theatre to host one of LVEDC’s “Conversation and Cocktails” events in August 2016, U.S. Senator Bob Casey said when he looks at the economy of the Lehigh Valley, he sees something that should be emulated all over the state and beyond. “What you’ve figured out here in a lot of ways is something we need to replicate, or imitate, across Pennsylvania and across the country.” LVEDC Fall Signature Event at Crayola “We manufacture and operate in the Lehigh Valley not just because it’s the right thing to do or it’s right politically. We do it because we think it’s the best thing for our business.” That’s what Crayola CEO Smith Holland had to say at the LVEDC Fall Signature Event in December 2016, held at the Crayola Experience in Easton. Each year, this event spotlights a major company from one of the region’s target sectors. The Role of Research in Commercial Real Estate Lauren Gilchrist, the Vice President, Director of Research for Philadelphia at JLL, visited the Lehigh Valley to share her knowledge and expertise about the role of research in commercial real estate during one of LVEDC’s Broker and Developers Council events in February 2016. “From Brownfields to Business” The Allentown Bridgeworks Enterprise Center, the former Mack Trucks Plant 4 that was refurbished into a business incubation program, was the perfect place to host Lehigh Valley Land Recycling Initiative’s “From Brownfields to Business” event in June 2016 about redevelopment in the Lehigh Valley. LVEDC ANNUAL REPORT • 2016 23
  24. LVEDC ANNUAL REPORT • 2016 Chair Stephen C. Kalamar Vice President & Relationship Manager TD Bank Vice Chair Jane P. Long Chair of the Corporate, Business & Banking Group Fitzpatrick Lentz & Bubba, P.C. Secretary Dr. Mark Erickson President Northampton Community College Treasurer Michael J. Gigler Senior Vice President, Senior Relationship Manager Wells Fargo Bank Don Cunningham President & CEO Lehigh Valley Economic Development Corporation Anne Baum Lehigh Valley Executive and VP, Distribution Channels & Labor Relations Capital BlueCross Donald Bernhard Secretary Allentown Economic Development Corporation Hon. John A. Brown County Executive Northampton County Luke Cunningham Chair Bethlehem Economic Development Corporation Hon. Robert Donchez Mayor City of Bethlehem Edward Dougherty Senior Vice President, Business & Network Development Lehigh Valley Health Network Gregory Dudkin President PPL Electric Utilities Corporation Joel Fagerstrom Executive Vice President / Chief Operating Officer St. Luke’s University Health Network Cindy Feinberg Partner Feinberg Real Estate Advisors Tom Garrity Managing Partner Compass Point Consulting Lauren Goff Executive Director, Corporate Social Responsibility Olympus Corporation of the Americas Dr. Bryon Grigsby President Moravian College Sally Handlon Founder & President Handlon Business Resources, LLC Andrew Hines Director of Facilities Lutron Electronics Co., Inc. T. Anthony Iannelli President & CEO Greater Lehigh Valley Chamber of Com- merce Mark Jobes Senior Vice President, Commercial Lending Officer Lafayette Ambassador Bank Patricia Johnson Vice President, Finance & Administration Lehigh University Gary Kinsey Manager, Real Estate & Property Management, IG Americas Energy & Real Estate Procurement Air Products and Chemicals, Inc. Dan McCarthy Secretary Lehigh Valley Partnership Hon. Tom Muller County Executive Lehigh County John L. Nespoli President & CEO Sacred Heart HealthCare System Hon. Brad Osborne Commissioner Lehigh County Board of Commissioners Hon. Sal Panto, Jr. Mayor City of Easton Hon. Ed Pawlowski Mayor City of Allentown Philip M. Schenkel Vice President JLL Michael Stershic President Discover Lehigh Valley R. Scott Unger Chairman Lehigh Valley Land Recycling Initiative Hon. Seth Vaughn Vice President Northampton County Council Barry Wentzel Director, East Region UGI Utilities, Inc. Don Cunningham President & CEO John Kingsley Vice President Finance Matthew Tuerk Vice President Economic Development & Marketing Jaime Whalen Vice President Administration & Investor Relations Lori Betters Director, Budget & Administration Melody Bradford Director, Business Outreach Programs Michael Keller Director, Marketing Andrew Kleiner Director, Redevelopment & External Affairs George Lewis Director, Research & Analysis Colin McEvoy, Director, Communications Doug Warfel Director, Regional Lending Jennifer Weighknecht Director, Credit Risk Jarrett Witt Director, Business Development Diane Milia Administrative Assistant Kat Schneider Office Administrator Stephanie Wean Finance Administrator 2016 LVEDC Board of Directors LVEDC Staff
  25. LVEDC ANNUAL REPORT • 2016 25 2016 Income & Expenses* Hotel Tax Proceeds $1,372,438 Private Sector Contributions $506,792 Finance & Administrative Fees $466,805 Grants $81,825 Public Sector Contributions $155,000 Other Income $10,168 $2,593,028 Operating Marketing Economic Development Financing A 26% 31% 16% 27% Operating Marketing Economic Development Financing Hotel Tax Proceeds Private Sector Contributions Grants Public Sector Contributions Other Income Finance & Administrative Fees 26% 31% 16% 27% 52.9% 19.5% 18% 3.2% 6% .4% 2016 Unaudited Revenue 2016 Unaudited Expenses Operating $665,300 Marketing $654,461 Economic Development $787,088 Financing $393,449 $2,500,298 *These figures do not include grant-specific funds managed by LVEDC.
  26. 2016 Investors The investment of these companies and organizations in 2016 helped make it possible for LVEDC to market the economic assets of the Lehigh Valley throughout the United States and the world. LVEDC had a record-breaking year of investment, totaling nearly $625,000. Thank you for your commitment to regional economic growth. Alvin H Butz Baurkot & Baurkot Law Brown-Daub Computer Aid Crayola DeSales University Duke Realty Embassy Bank Feinberg Real Estate Advisors Fitzpatrick Lentz & Bubba Follett Corporation Griffin Industrial Realty Hillwood Investment Properties Jaindl Land Development JLL JM Uliana & Associates Lafayette College Lee & Associates of Eastern PA Liberty Property Trust MKSD architects Moravian College Norris McLaughlin & Marcus OraSure Technologies Orbel Peoples Security Bank Provident Bank QNB Corporation Quandel Construction Group Sacred Heart Healthcare System Santander Bank Service Electric Lehigh County Northampton County GREEN KNIGHTS ECONOMIC DEVELOPMENT CORPORATION
  27. 27LVEDC ANNUAL REPORT • 2016 44 Business Capital A&H Sportswear Advantage Engineers Albarell Electric Allied Building Corporation Allied Personnel Services ARCO Design/Build Northeast Artefact Baker Tilly Bardot Plastics Barry Isett & Associates Berger-Epstein Associates Bethlehem Redevelopment Authority Blue Rock Construction Bohler Engineering Borton Lawson Broughal & Devito Buckno Lisicky & Company Cedar Crest College CF Martin & Company Communication Systems Compass Point Corporate Environments Deiter Brothers D’Huy Engineering Dutch Springs EarthRes Group Easton Area Industrial Land Development Corporation Easton Coach ESSA Bank & Trust Express Employment Professionals of Lehigh County Express Employment Professionals of Northampton County FastSigns Allentown Fedetz & Martin Associates First Commonwealth Federal Credit Union Fishburn Realty Company Gelcor Realty Good Shepherd Rehabilitation Network Gorski Engineering Graybar Electric Greater Lehigh Valley Realtors Haines & Kibblehouse Handlon Business Resources Hanover Engineering Associates Hanover Township - Lehigh County HDR Engineering Highland Associates HMK Insurance Horwith Trucks Hotel Bethlehem HT Lyons IMC Construction Ironton Telephone Company J&J Luxury Transportation JHG Hotel Management Just Born Kelly Automotive Group Kitchen Magic Klunk & Millan Advertising Knopf Automotive Kreischer Miller Kressler Wolff & Miller Lehigh Carbon Community College Lehigh Career & Technical Institute Lehigh County Authority Lehigh Valley Industrial Park Lehigh Valley Rail Management Lesavoy Butz & Seitz Life Sciences PA Lightweight Manufacturing LR Costanzo Co. Inc. Manufacturers Resource Center Markward Group Maser Consulting McTish Kunkel & Associates Merchants Bank of Bangor Mericle Commercial Real Estate Services Michael Baker International Modernfold of Reading Morris Black & Sons Nacci Printing New Tripoli Bank North Star Construction Management Northampton Community College Northeast Regional Council of Carpenters O’Brien’s Moving & Storage Ondra-Huyett Associates Ott Consulting Pennoni Associates Regan Levin Bloss Brown & Savchak Reimer Real Estate Rettew Associates SAGE Design-Build Schlouch Scot Lubricants Sperry Van Ness - Imperial Realty Spillman Farmer Architects Stevens & Lee Superior Quartz Products T&M Associates Talen Energy Terraform Engineering The Pidcock Company The Stone House Group Ultra-Poly Corporation Veraxia Commercial Real Estate Solutions Wind Gap Electric
  28. 2158 Avenue C, Suite 200 Bethlehem, PA 18017 Phone: 610-266-6775 • Fax: 610-266-7623 Our Mission The mission of the Lehigh Valley Economic Development Corporation is to market the economic assets of the Lehigh Valley and to serve as a regional shared services and resource center to help businesses to come, start and grow here. Our Vision Our vision is of a Lehigh Valley with a diverse economic base in our cities and counties that enable businesses to come here, start here and flourish here in order to create jobs and opportunities for all of our residents. Our Priorities • Marketing Economic Assets • Coordinating a Prepared Workforce • Focusing on City and Urban Development • Serving as a Shared Services Center • Providing Access to Capital • Building our Resources and Engaging Stakeholders Lehigh Valley Come here. Start here. Grow here. LVEDCisanaccreditedeconomicdevelopmentorganizationaccordingtotheIEDC. ©2017LehighValleyEconomicDevelopmentCorporation.AllRightsReserved.03.17 LVEDCAnnualReportdesignedbyMichelleChrin.PhotographybyMarcoCalderonorDigitalFeast.