After almost six years of living next to Daron Northeast, Tom Prendergast knows to place the china securely toward the back of the cupboard.
When Daron’s trucks rumble by, the vibrations are enough to rattle the porcelain cups and dishes right to the edge of the shelf.
For Evann Xanthis, it’s the dust. The chalky, pervasive dust that coats everything and jams air conditioners.
As residential prices continue to rise in New York and New Jersey, neighboring northeast Pennsylvania is beginning to look more and more attractive to metropolitan residents. Today, residents are moving to the area to take advantage of affordable home prices, a lower cost of living and all that the great outdoors has to offer. On the heels of this residential migration is an influx of retail development.
The majority of the retail development in this growing market is the repositioning of existing retail and infill development where there are gaps between the markets. The Shoppes at Montage, northeastern Pennsylvania’s first lifestyle center, opened this past spring and brought with it several new retailers to the area. Developed by Jeffrey R. Anderson Real Estate, the 316,000-square-foot center includes approximately 70 retailers including newcomers such as J. Jill, Christmas Tree Shops, Jos. A Bank and several specialty restaurants. The new center was also a big draw for staple regional mall tenants such as Victoria’s Secret and Gap. Located in the Glenmaura area right off of Interstate 81 between Scranton and Wilkes-Barre on Davis Street/Montage Mountain Road, the new lifestyle center will conveniently serve the entire northeast Pennsylvania market.
The area of Glenmaura is anticipated to be the next booming commercial real estate market in northeast Pennsylvania. In addition to the Shoppes at Montage, there is a large 18-screen cinema, a major corporate office park with Class A office buildings, a growing residential component, as well as a plethora of recreational activities ranging from the Montage Ski Resort, the Montage Performing Arts Center, an outdoor concert amphitheatre to a country club with a golf course. Another factor that will affect the growth in the area is the local AAA baseball franchise, which recently became an affiliate of the New York Yankees. In addition to being a tourist attraction, the owner of the franchise, Mandalay Sports, intends to develop the area surrounding the stadium with retail and other commercial development.
The Poconos is another growing area and a big draw for the northeastern Pennsylvania market. Heading east toward the Poconos, the Route 611 corridor is filling up with big-box development to the point that it has begun to put a strain on traffic. This new wave of retail development is being built to meet the demands of the growing population in the Poconos region. No longer primarily a second home community, a mix of residents, ranging from retiring baby boomers to young couples looking to start families and businesses, are moving to this idyllic area. Another factor affecting the growth of the Poconos is the new Mount Airy Casino that is slated to open this fall. The new gaming development promises to attract more tourists as well as residents with the promise of new jobs — again catalysts for more retail development.
Currently, retail vacancy rates are sitting at approximately 10 percent with rental rates ranging from $15 per square foot to $30 per square foot for mall rentals. However, keep your eye on this market because things are only going to get better.
- John T. Cognetti, SIOR, CCIM, is the president of Hinerfeld Commercial Real Estate.
- First published in Northeast Real Estate Business
On your July editorial. For several years I have put forward the thought of school consolidation in Lackawanna County. I have spoken at your annual regional report about it a few years back and have put it forward in print in other areas. Basically, Wake County, North Carolina has one school district. They have all kinds of schools for different types of students. The kids are bussed. Wake County made the commitment to education 30 years ago and the results are the famed Research Triangle and a great place to live.
Lackawanna County has nine school districts. Why should a child in Carbondale not have the same opportunity to a great education as a child in the Abingtons? Talk about a real economic revitalization tool! People choose where to live primarily based on the available education opportunities and affordability. Think about what would happen throughout the county if, no matter where you lived, you know your child would have an equal opportunity for a great education. Property values could stabilize or rise in certain areas. Tax burdens would be shared across the county. There are too many advantages to mention. Of course now, in Wake County, they are working on economic integration in the schools, another issue.
Of course, change comes with more change. The commonwealth would have to get involved, as well as unions, politicians, and so forth. You can get a headache thinking about it. But what about the children, their future, their world? Is it worth the effort? Absolutely.
Thanks.
John T. Cognetti, president, Hinerfeld Realty
- Letter to the Editor of Northeast Pennsylvania Business Journal
When you drive past a formerly dilapidated old neighborhood that’s suddenly undergoing an extreme makeover (like Scranton’s Hill section and more prominently in Monroe and Pike counties) you should rejoice — right? Not so fast.
A process called “gentrification” may be occurring and it’s an issue that has given some realtors and human service agencies cause for concern.
Under the banner of “affordable housing,” the Pocono Mountains Association of Realtors (PMAR) and other partners will probe the issue at a summit this month. The problem, according to Cheryl Ann Houseman, PMAR’s government affairs director, can be summed up by performing some simple math. The median home price in Monroe County (without property taxes, home-owner’s insurance and mortgage insurance) is $220,000. The average wage in Monroe County is $29,000 per year, which breaks down to roughly $2,416 per month — not enough for a monthly mortgage payment that will exceed $1,300 monthly — not if a family wants to eat.
The problem in the Poconos is that higher wage workers from the New York metro area have priced lower-income people out of the market.
John Cognetti, president of Hinerfeld Commercial Real Estate in Scranton says he has heard that many of those priced-out folks are moving into Lackawanna County — where affordable housing issues are just now appearing on the radar.
Mike Hanley, executive director of United Neighborhood Centers (UNC) of Northeastern Pennsylvania says gentrification has occurred in Scranton’s Hill section. He says he has personal knowledge of working class people who cannot afford a home in formerly affordable Scranton neighborhoods.
People are now being segregated, not by race, but by income.
Public policy has taken note.
Cognetti says, “Gentrification is a growing issue. It’s an interesting phenomenon. The government is pushing for integration of all income levels. Housing projects are being phased out with an emphasis on getting people into neighborhoods and creating a mix of affordable housing.”
Locally, PMAR has begun discussions in the Poconos about employer-assisted housing and other programs to get lower-income people into houses.
In Scranton, Catholic Social Services, UNC and even Scranton Tomorrow are examining ways to create affordable housing and, as UNC’s Hanley says, “Control gentrification so as not to push mid- and low-income families out of neighborhoods.”
Cognetti mentions another public policy approach — made necessary by income stratification — just now taking hold in places like Raleigh, N.C. , San Francisco and Seattle. The approach is termed, “economic integration.”
According to the Century Foundation (which publishes “issue briefs to help explain and call attention to public policy ideas worthy of discussion and debate”), “There is a new way on school integration — a program to boost the academic achievement of students and also increase interracial understanding without using race per se. Roughly 40 school districts in the United States are trying a new approach — socioeconomic or income-based school integration — and the early results are very promising . . . socioeconomic integration provides a more powerful way of promoting academic achievement . . .”
Parties concerned with affordable housing in northeast Pennsylvania obviously want to address gentrification and economic stratification before such school integration policies are necessary. Look for more on this issue in upcoming editions of the Business Journal.
-Elizabeth Zygmunt, Editor
- Courtesy of the Northeastern Pennsylvania Business Journal
A worship center a New Jersey-based Hindu organization plans for the former St. Stanislaus Church in North Scranton will be its first in Northeastern Pennsylvania.
The center, or mandir, will serve about 25 area families who are followers of BAPS Swaminarayan Sanstha, said Lenin Joshi, a spokesman at the organization’s U.S. headquarters in Piscataway, N.J.
When Vince Brust started searching for a new home for his dance studio a decade ago, he told his real estate agent he needed a big empty space.
“Like a factory,” he remembers saying.
What he found was something far more divine.
John Loyack thought the second floor of the Glenmaura Plaza building would make a good headquarters for local plastics manufacturer CPG International Inc., except for one problem: the bathrooms.
Specifically, it was the bathroom stalls and partitions made of metal. CPG is the nation’s leading producer of plastic bathroom partitions, which, of course, company president Mr. Loyack believes are superior to metal.
“We worked it into the lease agreement that we wanted our partitions,” Mr. Loyack said. “We’re proud of what we make, and after all, it is our office.”
The retrofitting wasn’t a problem for Glenmaura Plaza owner Sordoni Construction Services Inc. CPG provided the partitions at no charge and Sordoni’s crews customized the offices.
CPG, formerly called Compression Polymers Holdings Inc., moved its corporate headquarters into the building this week as it shuffles production and offices to accommodate growth.
About 50 people moved, and Mr. Loyack anticipates that employment will increase to 90 as it adds to its financing and technology staff.
From the west side of the office building, Mr. Loyack and employees can see where they came from, the sprawling 801 Corey St. plant about a mile away in Scranton.
The corporate employees had to make room for more production at the Corey Street site. CPG is selling its Winfield Avenue facility, and plans to move that to Corey Street.
In April, the company bought the product line of competing local plastic fabricator Santana Products for $34 million, doubling production of CPG’s prized bathroom partitions and lockers. At Corey Street, people were practically sitting on each other’s laps, Mr. Loyack said.
The Winfield Avenue facility has generated some interest, said listing agent John Cognetti of Hinerfeld Commercial Real Estate. He said serious inquiries have come from a manufacturer and an investor. While the 220,000-square-foot building is older, it has been upgraded and well-maintained, he said, with a large open space suitable for a range of uses.
CPG International has been a standout in the manufacturing sector in Northeastern Pennsylvania. Developing innovative plastic products used in laboratories, salt water, playgrounds and other places has positioned the company in a variety of potential markets. The company’s most successful foray has been into the construction market with Azek trimboards, a millable and paintable substitute for wood trim that resists damage from weather, insects and rot.
The 275,000-square-foot former Anemostat building on Keyser Avenue, purchased by the company in 2005, is dedicated to Azek and continues to increase production.
CPG added a 25,000-square-foot structure for an anticipated 11 production lines. So far, it has six.
CPG employs more than 400 people at its three facilities. Last year, the company reported revenue of $223 million.
The company is owned by a prominent New York City-based private equity firm, AEA Investments.
- Courtesy of The Times-Tribune
