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Slow economy isn't stopping retail growth
Despite a weakening economy and talk of a recession, retailers are building more stores in the Lehigh Valley.
Construction of several shopping malls is under way but most of the stores aren't scheduled to open until spring 2009.
Target will be an anchor in at least two of the retail centers under construction.
One is Lower Nazareth Commons, which will be built on 32 acres just south of Wegmans in Lower Nazareth Township.
The developer is Regency Centers based in Jacksonville, Fla., which owns more than 400 shopping plazas nationwide.
When complete, the 235,000-square-foot center will have about 15 stores and restaurants, including PetSmart and Sports Authority.
"We're working on leasing now," said Powell Arms, of the Bala Cynwyd, Montgomery County, office of Regency.
Site and road work are expected to begin as soon as the weather permits, Arms said.
Target also is planned as an anchor of a 500,000-square-foot shopping center at Airport Road south of Route 22 in Hanover Township, Lehigh County. Sam's Club will be the other anchor.
Other stores that have committed to the Airport Center are A.C. Moore, PetSmart and Ross Dress for Less, all of which have other locations in the Lehigh Valley. Two stores new to the Valley that are planned are The Christmas Tree Shops and Golf Galaxy. Romano's Macaroni Grill restaurant is also expected to open.
Site work for this center began at the end of 2007, said Dan Brickner of Metro Commercial in Conshohocken, Montgomery County.
Brickner said the location is what makes the Airport Center a go in a weakening retail economy. Given the state of the economy, retailers are cautious, Brickner said. However, he said, because of its location at one of the busiest intersections in the Lehigh Valley, "There is more interest in this property than there is space."
As of early this year, retailers had pre-leased 90 percent of the site, he said.
Target has stores in South Whitehall, Richland Township and Stroudsburg as well as Greenwich, N.J.
Another project, the Summit Lehigh Valley at Route 33 and Freemansburg Avenue in Bethlehem Township, is expected to move forward this year.
Plans for the Summit, an open-air lifestyle center, were announced in 2003 about the same time as Poag & McEwen of Memphis, Tenn., announced plans for The Promenade Shops at Saucon Valley. A short while later, it was announced that an area of outdoor, upscale shops would be added to the Lehigh Valley Mall in Whitehall.
The Promenade Shops, which measures about 475,000-square-feet, opened in the fall 2006 while the 110,000-square-foot addition to the Lehigh Valley Mall opened last summer but little work has occurred on the Summit site. At the time, many questioned how many upscale or outdoor lifestyle centers the Lehigh Valley could support.
The Summit is to be a joint project of Forest City Enterprises of Cleveland and Bayer Properties of Birmingham, Ala.
Bob McGurk, regional development director for Forest City, said that the Summit is still coming, only it will take longer than expected.
The project, to cover about 1 million square feet, was held up for almost two years by a dispute between the city of Bethlehem and Bethlehem Township over upgrades to the city's sewer service.
The dispute was settled in November 2007 and will allow plans for the area to proceed. In addition to the shopping center, among those projects affected include St. Luke Hospital's new medical campus, a hotel, a housing development and office space.
McGurk said that since the settlement was reached, Forest City has been working with Bethlehem Township on revising its plan.
"We're looking at reconfiguring and moving buildings around," McGurk said. "We have additional things we want to do."
The next step, McGurk said, is for Forest City to submit revised plans to the township Planning Commission and ultimately the commissioners. He expects that to happen this spring.
McGurk said that several retailers had committed to the site, but none that he could announce.
"We have a tremendous location and we're moving forward," he said.
Officials also mentioned Target for the Summit when they first announced plans for the shopping center. Anna Goeppinger, a spokeswoman for Minneapolis-based Target, said it is still possible. "It is not uncommon for Target to put another store within five miles of another if the market calls for it," she said.
However, she says, she could not comment on planned locations.
Yet another retail project that will see construction this year is at the Sands BethWorks casino site in south Bethlehem.
Plans call for 200,000 square feet of retail space in the first phase, said Tony Hanna, director of economic development for the City of Bethlehem.
Hanna said that the developers are in discussions with well-known national as well as local retailers. "They've had a lot of good discussions," he said. "They're progressing well on the retail and on the restaurant side."
Hanna expects that the names of some of the tenants will be announced by the middle of this year and that some will open by the third quarter of 2009. The slots casino is expected to open in the second quarter of 2009.
The master plan for the site of the former Bethlehem Steel plant calls for additional retail, he said. "But whether it will be by Las Vegas Sands or some other group has not yet been determined."
Hanna said the retail project would proceed despite a weakened economy because it is tied to the casino.
"I don't think the economy will have an impact," he said. "The casino development, while not totally recession-proof, is a different retail paradigm."
The casino is expected to attract 5 million visitors a year. Other retail sites have to generate their own visitors. This project will be able to feed off the casino-goers. That's why, Hanna said, "they haven't seen any kind of diminution of interest in the project."
Beth W. Orenstein is a freelance writer.