The Waterfront project, the ambitious plan to redevelop land along the Lehigh River in Allentown, is evolving.
Jaindl Enterprises’ Waterfront Development Co. recently announced an update to the master plan for 29 acres on the river’s west bank. It will turn the former industrial area into a place where people can live, work and shop.
This updated plan, which is still in the preliminary stage, will construct more places to live along with “hybrid” office space and a hotel.
Chief Operating Officer Zachary Jaindl told The Morning Call that when the project was announced in 2012, it was “intentionally office forward,” which made sense at the time. As part of the Neighborhood Improvement Zone, the city’s unique tax subsidy area, market demand mostly was for office space to attract employers and investment.
“But markets change,” Jaindl said.
There has been progress — it’s hard to miss the six-story 615 Waterfront office building when crossing the Tilghman Street bridge. It opened in 2023. Next door, the River House apartments are moving toward completion and will have 201 units at 30 E. Allen St.
Here’s what to know about the future plans and how things are changing at The Waterfront:
A rendering of The Waterfront that is being constructed in Allentown along the Lehigh River. The Waterfront Development Co. announced the completion of an updated long-term master plan on Tuesday. (Courtesy of The Waterfront Development Co.)
What is changing?
In the initial plan for 12 buildings, the mixture included four office buildings, four apartment buildings and three parking structures.
The new plan will have:
One office building, but there will be room for hybrid office space in residential properties. The flexible office space could be used by health care and specialty services.
Three residential buildings that will hold about 560 apartments between them, along with a series of for-purchase townhome clusters around the site. Jaindl said the number of townhomes is still to be determined.
A hotel at 645 Waterfront.
Specialty space, including maker space, in the north lots between multifamily residential and townhouse commons.
Parking will be consolidated in shared structures rather than having standalone garages tied to individual buildings.
Additional outdoor amenity spaces, public pathways and green spaces. Retail, dining and entertainment are still part of the plan and the thinking is to create a destination that complements the downtown.
Jaindl said the area will resemble a neighborhood, rather than a campus.
He said this approach was shaped by Pittsburgh-based Urban Design Associates, which followed a market study and a series of virtual and in-person workshops with community leaders and stakeholders.
“We didn’t abandon office — we right-sized it,” Jaindl said. “And we rebalanced the site so it works as a complete, long-term riverfront neighborhood.”
Jaindl Enterprises COO Zachary Jaindl talks Monday, Oct. 23, 2023, about the expansive views of the Lehigh riverfront from the new 615 Waterfront Drive office building, the first building to open in Jaindl’s Waterfront development in Allentown. (April Gamiz/The Morning Call)
Why make the change?
The COVID pandemic brought changes to work habits in the Lehigh Valley and across the nation as more people started working from home. Many of them continued working from home after the pandemic ebbed, forcing landlords and developers to rethink what to do with the empty space.
“The last decade – especially the period following COVID-19 — brought fundamental shifts in how people work, live and use space,” Jaindl said. “Office is still viable in the Lehigh Valley, particularly within the NIZ, but only at the right scale and with the right level of flexibility. At the same time, housing demand has proven far more durable.
“The updated master plan reflects that reality.”
Jaindl has been paying attention to the housing shortage in the Lehigh Valley, which has been estimated to be around 9,000 units by the Lehigh Valley Planning Commission. With a growing population, local governments and developers have been trying to keep up.
The Valley is considered one of the most competitive apartment markets in the country and has a vacancy rate of about 5%, well below the national average of 8.5%. Rents are up more than 25%, compared to 16% nationally.
“The regional housing market remains strong,” Jaindl said.
Is there danger of overdevelopment?
Blocks away from The Waterfront, other developers are erecting apartment buildings in the NIZ.
Urban Residential Properties, in partnership with The Manhattan Building Co., is building approximately 283 apartments and 40,000 square feet of commercial space at the site of the former Neuweiler Brewery at the corner of Front Street and Pump Place.
The same developer has gotten the ball rolling on converting the site of the former American Atelier furniture factory on Front Street into a building featuring 267 apartments.
Jaindl doesn’t think there is a danger of overdevelopment. He said that the Neuweiler Lofts and River House, with its combination of about 484 units, will make up 1.3% of the Lehigh Valley’s total apartment inventory and less than one year of recent absorption.
“That’s not oversupply; that’s the market doing what healthy markets do,” he said, adding that “thoughtful competition” is welcome.
“Given the strength of demand and the uniqueness of the riverfront, more people living in the neighborhood is a positive outcome,” Jaindl said.
He added that with the future extension of Riverside Drive to Whitehall Township the section of the city has been “planned with capacity in mind.”
How long will this take?
Development of the 29 acres was always planned to take years. Janidl said the pause in construction during the pandemic gave The Waterfront Co. time to think about the future and pivot.
“In hindsight, we’re somewhat thankful for that pause,” he said. “Had the original office-heavy plan been fully built out before the pandemic, we would likely be sitting on a large amount of office space that today’s market no longer needs at the same scale.”
The changes, he said, are more agile. Because infrastructure is in place, construction will likely accelerate.
“Instead of a rigid, sequential buildout, the plan allows for multiple phases to move forward at the same time, depending on market demand,” Jaindl said. “Residential, retail and other components can advance in parallel rather than waiting on a single use to be completed first.”
How much will it cost?
The revised plan won’t be as expensive as the initial $425 million.
Jaindl cautioned that the current plan is still a draft master plan, so the price could change as designs are finalized and market conditions change.
He said using current construction costs and the recent experiences at The Waterfront, along with internal benchmarking, the price tag could be $300 million-$350 million.
Jaindl attributed the lower cost to less speculation on office space, which is among the most expensive to build in today’s market; a reduction in structured parking, which is also expensive; and that much of the site’s infrastructure has already been built.
“This doesn’t represent a scaled-back vision,” Jaindl said. “The Waterfront remains a multi-hundred-million-dollar investment in Allentown’s riverfront. What’s changed is the efficiency and precision of the plan; capital is now being deployed into uses the market is clearly supporting, and in a way that allows the project to move forward more nimbly and responsibly over time.”
Morning Call reporter Evan Jones can be reached at ejones@mcall.com.