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Allentown State Hospital may be sold to City Center Investment Corp. for $5.5M, under new bill proposal - lehighvalleylive.com

The former Allentown State Hospital property may soon be sold off to a well-known area developer in a $5.5 million deal.

Republican Sen. Pat Browne, representing the 16th District, which covers portions of Lehigh County, introduced the bill this past Tuesday in Harrisburg. It calls for selling the 195-acre property to City Center Investment Corp., which is led by developer J.B. Reilly. City Center Investment is responsible for multiple major redevelopment projects in Downtown Allentown.

The bill additionally calls for the repeal of a 2019 law that laid out a process for the sale of the hospital’s property on Hanover Avenue near the border of Allentown and Bethlehem. A provision in the bill precludes any future installation of a gambling facility on the property. The bill was filed without public notice or any announcement of the potential deal.

Reached by lehighvalleylive.com Friday, Browne and Democratic Rep. Mike Schlossberg, representing the 132nd district, which covers a portion of Lehigh County, released this statement:

“After an open bidding process and considerable review of available options, the Department of General Services and the Allentown State Hospital Committee made the decision to convey the state hospital site to the most successful developer in Allentown’s modern history, City Center Allentown. Their knowledge and outstanding success in redeveloping challenged sites within the city make them the most qualified entity to undertake this promising task. We are confident that their development of the state hospital site will lead to positive results for our residents, our community and the City of Allentown.”

Matt Szuchyt, Browne’s deputy director of policy & communications, added the bill calls for the repeal of a 2019 law because the bid process was unsuccessful.

City Center president J.B. Reilly released a statement to lehighvalleylive.com Friday saying the developer is “excited and honored” to be considered for the project. City Center Investment’s vision would transform the property into what’s currently being dubbed as “Northridge,” a proposed mix of various housing options; public green space; and retail potential, as well as job creation and local tax revenue for the city and Allentown School District, Reilly said.

“As the local company behind the redevelopment of downtown Allentown, City Center is uniquely qualified to responsibly redevelop this important site,” Reilly said.

Northridge is the working name of the proposed site, given it’s in an area north of a large ridge overlooking the Lehigh River, said Jeff Vaughan, spokesman for City Center Allentown.

Proposed 'Northridge' on site of former Allentown State Hospital

Pictured is a rendering of the proposed 'Northridge,' which is City Center Investment’s vision for the 195-acre property. The project proposal includes a proposed mix of various housing options; public green space; and retail potential, as well as job creation and local tax revenue for the city and Allentown School District.

In order for the bill to be green lit, however, it would need to make its way through the state Legislature and then must be signed by Gov. Tom Wolf.

The governor signed legislation in July 2019 allowing for the demolition of the facilities on site and the hospital’s sale. That law then created a competitive bidding process for the sale of the property.

The property has been marketed as one of the biggest investment opportunities in one of Pennsylvania’s largest cities. It was home to the distinctive psychiatric hospital for nearly a century before shuttering completely in December 2010. Before its demolition in 2020, the main dormant building provided a setting for the M. Night Shyamalan movie “Glass.”

In a Lehigh Valley Economic Development Corp. blog post, Allentown Mayor Matt Tuerk had said the property had the potential to be “transformative.” Some recommendations were made in a 2020 study conducted at Allentown’s request. The reuse feasibility study said the site is the largest available for development in Allentown. It looked at accessibility, geology and other factors, even suggesting different layouts for a “town square” style development or a shop-lined boulevard.

The general conclusion was that a mix of residential, commercial and light industrial uses would be appropriate, with opportunity for mixed-use, open space and sports fields. Such development, it then said, could fulfill needs for fresh commercial space and affordable housing. The site, however, would not be well-suited for warehouses due to limited access, the study stated.

Browne, a 28-year veteran lawmaker in Harrisburg and chairman of the Senate Appropriations Committee, was defeated in the May Republican primary election by Jarrett Coleman. Coleman, of Upper Macungie Township, is a Parkland School Board member and an airline pilot with no statewide political experience.

Proposed 'Northridge' on site of former Allentown State Hospital

Pictured is a rendering of the proposed 'Northridge,' which is City Center Investment’s vision for the 195-acre property. The project proposal includes a proposed mix of various housing options; public green space; and retail potential, as well as job creation and local tax revenue for the city and Allentown School District.

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Pamela Sroka-Holzmann may be reached at pholzmann@lehighvalleylive.com.

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Allentown State Hospital may be sold to City Center Investment Corp. for $5.5M, under new bill proposal - lehighvalleylive.com
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