Downtown Allentown’s biggest developer and landlord is looking to renovate one historic building and make improvements to two newer ones.
on Wednesday received approval for $20 million in tax revenue bonds from the Allentown Neighborhood Improvement Zone Development Authority for two different projects.
The first $10 million will go toward a $35.1 million project to improve the former Merchants Bank Building at Seventh and Hamilton streets. Dubbed 1 Center Square, the vacant building will be refurbished into a four-story, mixed-use structure with offices and retail.
The next $10 million will go toward capital improvements for 1 City Center, which is adjacent to the PPL Center, and 2 City Center across Seventh Street. The developer’s two oldest buildings in the NIZ, both were completed in 2014. The upgrades are estimated to cost $11.1 million.
Josh Taykowski, investment officer for City Center, presented both projects to the ANIZDA board. He said the company has rented out 100% of its office space, which is why City Center has come with a third revision for its 1 Center Square plan.
The latest proposal adds a fourth floor for a total of 87,000 square feet with ground-level retail and office space on the top three floors. The southern annex space of about 12,500 square feet would be demolished and replaced with a four-story glass addition.
The project was last presented to ANIZDA in October 2023 as a three-story building. That version was scaled back from the 16-story structure that was proposed in 2019. Initial plans in 2017 were for an 18-story tower.
“I think the conversations that we’ve been having as of late with not only existing tenants, but potential new ones as well, highlight a renewed demand for office space,” Taykowski said. “But I think what’s different post-COVID versus pre-COVID is that it really needs to be a signature Class A office, and that’s really what the design intent is for this third submission.”
The ground floor of 1 Center Square will be a “signature corner” for the downtown and blend in with the upcoming Center Square improvement project. The building will be anchored by a restaurant with exterior patio space.
Ceilings for the first floor will be mostly 22 feet high, with 14-foot ceilings on the upper three floors. Another feature will be a small executive parking lot with seven spaces that is meant to “attract some executive-level office space and to incentivize those potential tenants,” Taykowski said.
ANIZDA initially approved $17.5 million for the project in 2023 and City Center has about $16 million left over after some interior demolition. If approvals go through in the upcoming weeks, work is expected to start in August with a completion date in January 2027.
Capital improvements
Among the first projects first approved by ANIZDA after it was formed, 1 City Center and 2 City Center have two of the downtown’s most prominent businesses: СŷƵ Health Network and PPL Electric Utilities, respectively.
Taykowski said to keep the downtown thriving, it’s important to keep tenants happy.
“We think that creates significant value for our tenants in these buildings, who are among some of the largest,” he said. “We think that by refreshing, refurbishing their spaces, and potentially repurposing some of their spaces, it creates a significant amount of value for them.”
ANIZDA Chair Seymour Traub said it’s critical to keep LVHN and PPL downtown.
“If this is necessary to enable you to lengthen leases by a substantial amount, this value is worth it,” he said.
Morning Call reporter Evan Jones can be reached at ejones@mcall.com.
