Route 1 corridor targeted for commercial growth06/19/2013 01:43PM ● By Randy
By Steven Hoffman
With 4 million to 5 million square feet of potential industrial and commercial space, the Route 1 corridor from Kennett Square to Nottingham should serve as the focal point of commercial and industrial development during the next two decades, according to officials from the Chester County Economic Development Council.
“I believe the Route 1 business corridor is probably the best opportunity in the county for development,” explained Robert Grabus, the Development Advisor with the Chester County Economic Development Council. “We've got communities down here that are ready for the tax ratables.”
Southern Chester County already boasts a diverse lineup of businesses from Chatham Financial to Dansko to Genesis Healthcare to Herr Foods, to the mushroom industry that is centered around New Garden Township. A June 13 bus tour organized for commercial real estate agents, investors, and bankers highlighted more than a dozen potential sites for industrial or commercial development. The purpose of the tour was to make everyone aware of the opportunities for development along the Route 1 corridor.
“The goal,” said development director MaryFrances McGarrity, “is to shine attention on the southern part of the county.”
Grabus said that the Route 1 economic development initiative started about 20 months ago with officials from twelve municipalities working together to make sure that the proper zoning and infrastructure is in place so that businesses can decide to locate in the area.
“It's all about collaboration,” Grabus said. “What one municipality does affects the other folks, so by working together we can move forward. We have everybody pulling together down here.”
One reason that the Route 1 corridor between West Nottingham Township and Kennett Township is favorable for commercial and industrial growth is because of Route 1 itself—it is a good road with lots of exits that allow for free-flowing traffic. Baltimore Pike provides a good alternative as a secondary route as well, reducing the chance for traffic tie-ups. Route 1 is in close proximity to other major roadways in the region, which is a necessity for larger companies.
“There's definitely an opportunity for development here,” said Eric Stretch, the vice president of Newmark Grubb Knight Frank, a real estate services firm.
The bus tour began at the Hilton Garden Inn in East Marlborough Township and quickly moved to two sites on the Exelon campus between Route 1 and East Baltimore Pike in Kennett Township. Exelon Generation occupies two 125,000 square-foot buildings on the campus, but two other pad-ready sites—one approved for 80,000 square feet and the other for 100,000 square feet—would be ideal for a company looking for office space.
“You could not ask for a better corporate neighbor than Exelon,” Grabus noted.
Elaine Battaglia, a director of Newmark Grubb Knight Frank, explained that the two sites could be ready quickly because the infrastructure and all the approvals are already in place. The offices could also be built to suit a tenant's specific needs.
“We're reaching out to some medical groups,” Battaglia said.
Not far from the Exelon campus, there is a 30,000 square-foot flexible space available on Gale Lane in East Marlborough Township: 24,000 square feet of that could be warehouse space, with another 6,000 square feet for use as office space. There are a total of five lots—one 39.9-acre parcel on Schoolhouse Road and four smaller parcels clustered on Gale Lane—that are zoned industrial in the same area that have easy access to Route 1.
There are three larger developments currently underway near the border between Kennett Square Borough and Kennett Township. The Kennett Business Park will be situated on a 19-acre property on South Mill Road. It has been approved for a total of 195,000 square feet of flexible space, that can be divided to fit the needs of the business.
Grabus sees a natural connection between what the Pia family is developing at the Kennett Business Park and the nearby Magnolia Place, which includes townhouses and twins, as well as a mixed-use building.
“This is a really unique situation that Mike Pia and his family are creating,” Grabus said, noting that people could live in the townhouses and work just a short distance away at the business park.
Adjacent to Magnolia Place is the NVF site, which Delaware Valley Development is currently in the process of redeveloping. The property, long used for manufacturing, has been remediated and all the old buildings have been cleared. The developer is willing to subdivide the property, and it could be utilized for a combination of industrial and commercial or low-income residential development. The 26-acre site has access to the East Penn Railroad.
As the tour moved through the Kennett Square area toward New Garden Township, Grabus pointed out that the Manfredi cold storage facility is one of the largest and most modern of its kind in the country.
“They do some fantastic work there,” he said. “There’s a lot of distribution that goes on along Route 1. We talk to distribution companies and they say this is where their businesses want them to be. They say it’s a tremendous place to do business.”
The Manfredi storage facility, along with the Pia ventures, as well as the business activities of the Leo family illustrate that the mushroom industry, and the families associated with it, continues to be important to the area.
The tour continued to a site at Route 1 and Newark Road in New Garden Township that has a total of 105.39 acres available with the potential to accommodate 900,000 square feet of space. The property, situated around the township-owned New Garden Flying Field is zoned to be used as a technology or business park, and there could also be industrial, office space, or research-and-development uses, especially by companies that could utilize the airport.
“It's a great site,” Grabus said. “This is a little bit more long-term than some of the other sites.”
The Chester County Economic Development Council provides assistance to businesses looking to locate in Chester County. McGarrity said that this includes facilitating financing opportunities for businesses, and during the tour, she outlined various county, state, and federal programs that provide some funding for new or expanding businesses. For instance, PennWorks, a grant-and-loan program with the state, provides money to help ensure a safe water supply and proper wastewater infrastructure.
As the tour continued south, Grabus noted that progress has occurred at the intersection of Route 1 and Route 41 because London Grove Township's officials have receptive to allowing some controlled commercial development. The Pettinaro company developed a shopping center along Route 41 and also has about 157,000 square feet of approved office and retail space available at the London Grove West site near the shopping center. The office and retail space can be built to suit a tenant.
Grabus also praised Penn Township officials for planning for smart growth that expanded the commercial tax base in the Avon Grove area.
“Penn Township is a very progressive township,” he said. “It’s very developer-friendly, and they have great supervisors here. There are also fantastic demographics down here.”
There are three lots near the intersection with Route 1 and Route 796 that are all zoned for industrial uses. They are 9.2 acres, 20.9 acres, and 31.8 acres, respectively.
Grabus noted that Dansko, a well-respected company, has a large presence in Penn Township, and would make an ideal neighbor for another business. One business could decide to relocate to a former Dansko property: A 95,000 square-foot building that could be used as a warehouse or distribution facility with about 16,000 square feet of office space is available for sale or for lease on Federal Road.
State Rep. John Lawrence, whose office is located in Penn Township, observed that the township has developed into a hub for medical facilities, and virtually every regional health system has a presence in Penn Township.
“As we move forward, it’s easy to envision that this will continue,” Lawrence said, noting that several regional hospitals are currently planning expansions into the township.
As the tour continued south past Lincoln University, Grabus explained that university president Dr. Robert Jennings has been working to increase the school’s involvement in the community. There have even been preliminary talks about the possibility of building a research-and-development park on the land that the university owns.
Just a short distance from Lincoln University on Baltimore Pike, there is a commercially zoned lot of slightly more than 53 acres for sale. Subdivision plans for an industrial business park have been submitted for approval, and there could be as many as 15 business sites on the parcel. Allowable uses range from a convenience store to a farm supply outlet to medical clinics and laboratory facilities.
Grabus said that they plan to apply for a grant that will help fund public sewers for a portion of Baltimore Pike that extends to the Oxford Borough line. Developers who are willing to put up the initial capital to pay for the sewer expansion have already been identified. They will recoup some of the costs as others tie in to the public sewer system. If all goes well, Grabus said, they could find out if the grant is approved as early as September.
Moving toward the southern part of the Route 1 corridor, there are eight properties for sale along Limestone Road near the Oxford Commons shopping center—smaller lots that range from .39 acres to nearly 3 acres. There are currently residential buildings on some of the parcels, and some of the parcels can be combined. The properties are zoned Neighborhood Commercial, and they are less than a half a mile from Route 1.
In Nottingham, there is a 123-acre site zoned for industrial uses that is just one mile from Route 1 and ten miles from I-95. It is also one of the largest lots with rail access available in southeastern Pennsylvania.
Grabus noted that a few years ago Lowe's was interested in building a distribution facility on this site.
A large international paper company also had this on the short list of properties considered for a new plant, but the company ultimately decided to go in another direction because the Nottingham site does not have a water repository nearby.
“The fact that they looked at this property indicates that larger logistics firms are who you should be be talking to about it,” Grabus said. “It's truly one of the unique properties in the region.”
The tour concluded at Herr Foods, one of the county's largest employers and a leader in the snack food industry.
Herr Foods CEO James M. Herr talked about why the company continues to call Chester County home.
“It’s a beautiful place. We like the rural nature of it,” Herr said. “It’s been a great place to live and work.”
It would be difficult to find a company that embodies the character of southern Chester County more than Herr Foods, and Grabus said that this is the kind of generational company that the Chester County Economic Development Council is looking to bring to the area.
“Home-grown industries are what we are trying to promote,” Grabus said. “We want to supply jobs for folks down here.”
Part of the reason for focusing the commercial and industrial growth along the Route 1 corridor is to protect the valuable farmland and rural character that southern Chester County is known for.
“We’re going to contain the development right along this corridor,” Grabus said. “We have a number of properties that will come online in the next 18 to 24 months.”
“This is about sustainable, smart growth,” said Stretch, noting that local officials worked cooperatively to plan out where they want growth to occur.
Oxford residents currently have the highest tax burden in the area because of the lack a sufficient commercial tax base. Oxford schools also work with $15 million less than surrounding schools as a result of the comparatively small tax base.
“There is a consensus that something needs to change. If we don't have ratables here, taxes will be too high,” Grabus said.
The availability of public water and sewer often dictates where development will occur. Oxford's ability to add tax ratables was hampered for several years because Oxford's public sewer system was at capacity and a moratorium was imposed.
“Public water and sewer hasn't been available,” Stretch said.
“It's the single biggest issue,” Grabus added. “It's hard to sell against other locations that have that lined up.”
Now that additional sewage capacity has been secured, the possibility of expanding public sewers in Lower Oxford and East Nottingham could play a large role in determining whether the Oxford area can attract a sufficient amount of commercial development.
“It would open up 700 acres of zoned and approved properties with the infrastructure in place,” Grabus said.
Grabus added that he's very optimistic about the future of the Oxford area, in part because of the commercial development that should come to the Route 1 corridor.
“This was the hub of Southern Chester County at one time,” he said. “I think it's the next community to get going. We've been waiting for the infrastructure for a long time and now it's in place. There is a real opportunity here.”