Lehigh Valley

Airport authority weighing next move on development proposals

LVIA considering whether to court more developers

ALLENTOWN, Pa. - Airport officials need to decide whether it’s time to move forward with five proposals to develop nearly 300 acres around Lehigh Valley International Airport or re-cast a wider net for potential suitors.

The Lehigh-Northampton Airport Authority’s executive committee on Tuesday discussed what the authority's next step should be for roughly 290 acres northeast of the airport on the east side of Airport Road. The committee met at Queen City Airport. 

In October, the authority put out a call for development groups interested in the property. Five firms submitted proposals, and authority staff on Tuesday recommended the committee pass the top three onto the full board for review.

The authority retained real estate development firm, Cushman and Wakefield, to help assess development proposals. Darren Betters, the authority’s director of business development, said Cushman and Wakefield recommended re-opening the process in hopes of attracting proposals from other development groups.

If the authority opted not to take additional proposals, the firm then suggested that all five developers be considered for the next stage, a 120-day due diligence period in which proposals are refined, according to Betters.

But the staff had proposed whittling the list down to three development groups for the next phase. Cushman and Wakefield ranked the five proposals with the top three being Hunterdon County-based J.G. Petrucci Company, Majestic Realty Co. and Dallas-based Trammell Crow Co.

While all five proposals were strong, Betters told the executive committee that re-opening the proposal process will further delay things. He also noted that a development group may be more willing to spend the money necessary to refine a proposal if there are fewer competitors being considered.

Board member Chuck Diacont said the proposals submitted on time by the five firms were intended to provide an overview of their qualifications for a project of this size.

“These were the five that were serious and played by the rules,” he said.

Other companies that have an interest in the property can always approach the selected developer about some type of partnership, which is not an unusual tactic in the development industry, Diacont said.

Time is money, Diacont said, and it’s going to take the development firms time to work through what could be done on the property, for instance, from a zoning standpoint.

The “worst-case scenario” is the authority decides at the end of the 120-day due diligence period that none of the proposals work and officials re-start the process, Betters said.

“The risk is really four months of time,” he said.

But board member Ed Lozano suggested the full board hear from its real estate consultant about its recommendations. Cushman and Wakefield recommended re-opening the process, so the board should take the time to understand the reasons behind suggestions made by the group the authority paid for advice, he said.

Diacont made a motion that the full board next week consider moving ahead with the top three proposals. He later pulled that motion off the table, agreeing that board members should hear what Cushman and Wakefield had to say.

After the meeting, board Chairman Mike Dowd said the authority will ask its consultant to meet with the full board during its meeting next week. His hope is that officials will make a decision by the end of that meeting on whether to move ahead with the proposals in hand or re-open the process.

If the board decides to solicit more proposals, Executive Director Charles Everett said the authority will need to throw out all the proposals and re-start the process. He noted that the submissions the authority has in hand are broad-brush proposals about what could be possible for the land. Developers are expected to further detail their ideas during the due diligence period.

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