European retailer takes huge lease in Lehigh Valley

Primark will occupy space at 2485 Commerce Center Blvd. in Bethlehem, Pa

The Lehigh Valley has landed another major distribution center as Primark Stores Ltd., a European retailer that is establishing a presence in the United States, has decided to lease nearly 700,000 square feet in the market.

The lease underscores the Lehigh Valley's dominance as a warehouse-distribution market for the East Coast. It logged record-breaking absorption last year, according to CBRE Inc. year-end data. In all, 16 million square feet of space was absorbed in the Lehigh Valley-Central Pennsylvania market. The Lehigh Valley alone, with 62.7 million square feet, has a tight 3.1 percent vacancy rate, which is a reduction from 4.8 percent in 2013. Rents are nudging close to $4.50 a square foot.

Primark signed a deal to occupy 677,088 square feet at 2485 Commerce Center Blvd. in Bethlehem, Pa. The building will serve as its primary distribution center for the East Coast. Joe McDermott, Vincent Ranalli and Jake Terkanian of CBRE Inc. struck the lease deal.

Primark has an arrangement to lease space from Sears Holding Corp. and will open seven stores throughout the Northeast. Primark's first store will be at the former Sears at the King of Prussia Mall in King of Prussia, Pa.

The distribution facility Primark will occupy was constructed by Trammell Crow Co. and Clarion Partners and is within the Lehigh Valley Industrial Park VII. The property had once been occupied by Bethlehem Steel Co. and has been redeveloped as a hub for warehouse-distribution centers. Other tenants in the industrial park include Walmart, which leases 2.4 million square feet, Crayola, which has 800,000 square feet, and Zulily, which also has 800,000 square feet.

Source: Philadelphia Business Journal