Community First Fund, a regional community development financial institution, has helped a Lehigh Valley Manufacturer purchase new manufacturing and warehouse space at a brownfields site in Allentown using New Market Tax Credits.
New Market Tax Credits are designed to encourage development and investment in distressed communities.
The project by Marcon Properties is revitalizing a blighted 17.5-acre manufacturing campus off 10th Street in the city.
Marcon purchased the property from the Allentown Economic Development Corporation and is repurposing old manufacturing buildings on the site to house its main manufacturing and warehousing for its Eastern Exterior Wall Systems division, which has made the exterior panels for such notable properties as the PPL Center in Allentown and Wind Creek Resort in Bethlehem.
For Marcon, it's an opportunity to build its business on a property it owns.
Jody Marcon, president and CEO of Marcon Industries, said the company did originally own its own manufacturing facilities, but because of the fluctuating nature of the construction industry, decided to lease space instead so it would be easier to upscale or downscale production based on demand.
However, with industrial rents on the rise, he said the company decided having its own facility, with flexible space, would be a better option moving forward.
The company has already completed construction on the first building on the site, which is 50,000 square feet. It will be moving its manufacturing and warehousing operations currently in leased space in Easton to the building.
Ultimately, a second, 110,000-square-foot building will house the main operations, but that is still under construction.
The smaller buildings will then be used for overflow work when they get busy.
But the project isn’t just about improving manufacturing operations for EEWS. It will have a major impact on the community at large, which is why Community First got involved.
This initiative will create the opportunity to access jobs and foster skilled workforce development in Allentown, contributing to community transformation said Daniel Betancourt, president and CEO of Community First Fund.
“Our goal is to transform communities,” said Betancourt. “We are excited to be involved in a project that will create new quality jobs as well as skilled workforce development in Allentown.”
Marcon said that when complete, the new manufacturing campus will employ more than 90 workers, up from the 45 employees currently working in Easton, so it will add to employment in the region.
As a bonus, the jobs would be within walking or bus distance of a large low-income population, which means it will bring jobs where they are most needed.
The project has a total cost of $49 million and is aimed at addressing the community’s 25% poverty rate, unemployment twice the national average, and a median family income of 56.2% the national average.
Community First Fund has allocated a $6 million NMTC investment and a $2 million leverage loan.
According to Marcon, around 40% of the source loan it received can be forgiven if the project meets its goals of site remediation and job creation, which he said it already has.
Overall, he said the help from the financing helped cover about 10%, or just under $4 million of the project's costs, which helped bolster the construction project.
The financing structure also includes NMTC allocations from Building America’s CDE and
Consortium America’s CDE, investments from Capital One, and loans from Fulton Bank demonstrating a commitment to community revitalization and economic development.
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