BY JON O’CONNELL, STAFF WRITER / Published: April 27, 2019
SCRANTON — The meaning of “big box” is changing.
Historically, the term described major retailers in the vein of Walmart and Best Buy. However, it flew around Wednesday at the Northeastern Pennsylvania Real Estate Summit when developers talked about the region’s biggest new-investment driver.
Twenty years ago, the idea of 1-million-square-foot distribution centers along the Interstate 81 corridor was fantasy.
Now, it seems developers announce new “boxes” on that scale every couple of months.
The big ones grab headlines but tell a small slice of the story, said Jim Cummings, Mericle Commercial Real Estate Services’ vice president of marketing.
“They’re a very small percentage, really, of the activity we’re seeing in the market,” he said.
Only 19 of the 104 deals Mericle saw in suburban business parks have been for 250,000 square feet or larger, he said. Sixty-three of the deals occupied 100,000 square feet or less.
More than 200 guests attended the second annual real estate summit, which was hosted at the Hilton Scranton and Conference Center.
The regional consortium Penn’s Northeast hosted the event to give builders, investors and other real estate stakeholders a detailed snapshot of the market area that includes Lackawanna, Luzerne, Monroe, Pike, Wayne and Schuylkill counties.
“Last year, four days before the event, we were scrambling to try and fill some of the seats up, and this year it was a sell-out,” said Penn’s Northeast President John Augustine. “That’s fantastic.”
Panelists included local and national heavyweights such as Colliers International Group Inc. Senior Vice President Jeff Algatt, John Cognetti of Hinerfeld Commercial Real Estate, and Quandel Construction Group business development Director Ronda Beemer.
A second panel included Evan Weiss of Pennsylvania Economy League Analytics and PNC Bank Senior Vice President Kevin Rogers who spoke on new federal opportunity zones and the tax incentives associated with them.
The panelists laid out themes that anyone who pays attention to regional development would recognize — health care and retail continue to be the area’s strongest jobs sectors, but the transportation and logistics are the rising stars with millions of square feet of new warehouses and distribution centers under construction or in planning.
Northeast Pennsylvania has an edge over competitors, namely, the Lehigh Valley, where property near the interstate grows more expensive and the labor pool looks more and more like a labor puddle.
Brian Knowles, a panelist Wednesday and principal with Lee & Associates of Eastern Pennsylvania, identified about 90 million square feet worth of projects across the eastern part of the state that haven’t started yet.
He bounced his laser pointer light across a map on a projector screen and circled the deep crimson blob covering New York City — the source of heavy investment capital that the northeast can ride through economic highs and lows.
“This is going to sustain our growth even if we have a peak, if we have a valley,” he said. “These are the folks that are really recruiting locations and spending money in these different markets.”
Contact the writer:
joconnell@timesshamrock.com
570-348-9131; @jon_oc
