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Bethlehem's Martin Tower sold to Jersey developer
Martin Tower, headquarters of the former Bethlehem Steel Corp., has been sold to a private New Jersey company, the second major Steel holding that has passed in the last two weeks to new owners who plan to invest millions in the properties.
Freedman & Co. Real Estate of Mount Laurel, a brokerage and development firm, has signed an agreement of sale for the Lehigh Valley's tallest building, a symbol of Bethlehem Steel's long reign as the nation's No. 2 steelmaker.
Carl Freedman, principal of the company, declined to divulge a sale price for the 21-story building or talk about uses that might be considered for the office high-rise at Eighth Avenue and Route 378 in Bethlehem.
''We saw what we thought was a real good piece of real estate,'' said Freedman, who came to Martin Tower on Thursday. ''We're new into the process and trying to get our arms around it.''
Joseph Posh Sr., a Bethlehem developer and a minority partner in the deal, said last week the sale price for the 55-acre campus is between $14 million and $16 million. As much as another $25 million would be needed to improve the building's physical plant, remove asbestos and add parking, Posh said.
Posh could not be reached Thursday for comment.
Freedman signed the agreement of sale with International Steel Group, the Cleveland steelmaker that bought the assets of bankrupt Bethlehem Steel in May.
On Monday, Lehigh Valley Industrial Park Inc. announced it had purchased 1,000 acres of former Bethlehem Steel land on the city's South Side from ISG for an industrial park. When complete, the park is expected to create 6,000 jobs with an annual payroll of about $210 million.
Beyond its historical significance to the city, Martin Tower has a lot of appeal because of its location and surroundings, Freedman said.
''It has good demographics, it's a good area, and there are solid people in the area,'' Freedman said. ''If you're driving down the road, you can see it for a long way.''
Named for former Bethlehem Steel Chairman Edmund F. Martin, Martin Tower opened in 1972 and was appraised in 2002 at $31.6 million. At 332 feet, it outreaches PPL Corp.'s headquarters in Allentown by 8 feet.
Mayor John Callahan, who has been in office less than two weeks, welcomed the second piece of good news about former Bethlehem Steel property.
'' an incredibly important building in the city. It's the most dramatic landmark in the city, and more importantly, it's been the source of a lot of high-paying great jobs for Bethlehem,'' Callahan said. ''The sale for Martin Tower is just another sign that things are moving forward whether it's this or LVIP buying 1,000 acres of Bethlehem Steel's brownfields.''
Brownfields are contaminated industrial sites that have to be cleaned up before they can be used.
The major tenants will stay at the building. D&B, formerly Dun & Bradstreet, has split into two companies, and keeping them in Martin Tower was key to any sale, according to developers who bid on the building in April.
The two companies lease about half of the 650,000 square feet in Martin Tower, the annex and print shop. A spokesman for the companies said both D&B entities will remain in the building at least until the lease expires in June 2006.
D&B, a 162-year-old company that provides corporate credit information and other financial data to business clients, is based in Short Hills, N.J., and employs 976 people in Lehigh and Northampton counties, most of them in the Martin Tower complex.
D&B Receivables Management Services was sold in 2001 and is now a private company based in Bethlehem that provides debt collection and related services. It employs 971 people in Martin Tower.
About 35 percent to 40 percent of the tower is unoccupied, according to Roger Osche, a consultant to ISG who oversees some of the steelmaker's properties in Bethlehem. That is the equivalent of seven to eight vacant floors.
Bethlehem Steel and a host of real estate companies struggled for years to sell Martin Tower.
The agreement of sale means only two other significant tracts of idled Bethlehem Steel property remain, and both are already under agreement of sale.
Majestic Realty Co., based in California, has 550 acres of South Side land under agreement with ISG for development into a business park of light industrial and warehousing uses. Majestic Vice President Tom Cozzolino said the company is researching the extent of heavy metal contamination on the land and doesn't expect settlement on the property soon.
Delaware Valley Real Estate Investment Fund is planning to buy 120 acres at the far western end of the former Bethlehem Steel property for development into Bethlehem Works, a $160 million retail, residential and entertainment district.
Freedman & Co. is a real estate development, management and brokerage company mainly involved with malls. It has extensive holdings in New Jersey and near Philadelphia, and a year ago purchased the 440,000-square-foot Colonial Commons shopping center in Lower Paxton Township, Dauphin County.
Reporter Nicole Radzievich contributed to this story.