45th Edition: January 29th - February 2nd 2024

A Strategic Corridor Emerges as a Hub for Advanced Manufacturing

We’re living through a new industrial revolution, driven by a global competition for semiconductor manufacturing projects. The United States, China, Japan, Taiwan, Germany and other countries are vying to attract and support these significant capital-intensive projects. New York has emerged as a rising star in the semiconductor industry – Global Foundries, Onsemi, AMD, IBM, and now Micron have positioned New York State to play a critical role in growing this dynamic industry.

Earlier this month, we attended the Semiconductor Strategy Symposium, one of the largest semiconductor conferences in the world. Hundreds of executives from across the semiconductor industry were in attendance, including companies like Micron, Intel, Onsemi and numerous supply chain manufacturers. With a contingent of economic developers from across NYS, our goal was clear: position Orange County and the Mid-Hudson as “the bridge” between NYC innovation and upstate semiconductor assets – an ideal location for the supply chain. Specifically, the semiconductor supply chain opportunity is driven by the manufacturers of tools, equipment, packaging, and advanced materials – these firms are suppliers for chip fabrication plants, and will seek to establish advanced manufacturing facilities proximate to their semiconductor customers across the Northeast.

To attract and grow this industry, we cannot proceed alone, collaboration is key. To that end, we’re working with our partners from Sullivan, Delaware, and Broome Counties along Route 17 to collaboratively market the Corridor for semiconductor and advanced manufacturing. The goal of this collaboration is to share assets, leads, and opportunities – combining our collective market assets to position the corridor for a robust manufacturing ecosystem. This corridor can accommodate different projects the supply chain and manufacturing space. Our distinct, dynamic markets will be connected via an innovation super-highway.

The real estate industry is rapidly chaining around us – reshoring, federal and state tax credits, infrastructure demand, market ecosystems, etc. If we don’t act now, we will miss the opportunity to fundamentally change our market. Aggressive, bold action is needed to play a role in the semiconductor and advanced manufacturing industry. Orange County will always be a desired location for interstate distribution projects. To compete for advanced manufacturing projects, we must continue to invest in our water and sewer infrastructure. Our County Executive and Legislature are leading the charge, working with local communities to expand infrastructure. On February 29th, the Alliance for Balanced Growth will be tackling this issue head-on, focusing on creative solutions to maximize economic development infrastructure. At the end of the day, site development, infrastructure investment, and regional collaboration are critical for the economy of today, and tomorrow.

My very best,

Maureen Halahan

President & CEO

Route 17/I-86 & I-84 Innovation Corridor

Expert Panelists Include:

STEVE NEUHAUS

Orange County Executive

JOE DESTEFANO

City of Middletown Mayor

JOHN BRUST

Delaware Engineering, D.P.C.

JOE MCKAY

Catania, Mahon & Rider, PLLC

MODERATOR:

DAN DEPEW

Holt Construction

Water & Sewer: A Strategic Resource for Smart Growth

We’re hosting our first Alliance for Balanced Growth (ABG) event of 2024 on February 29^th. The goal of the ABG is to advocate for smart, sustainable development ideals in Orange County – and what better way to start the year than discussing creative solutions to maximizing water/sewer infrastructure? Water and sewer infrastructure is one of the critical items for encouraging sustainable, next generation economic growth. Our message is clear – to foster smart growth and job creation in Orange County, we must prioritize water/sewer infrastructure.

Site selection opportunities are continually becoming more advanced manufacturing and tech-oriented – as a result, water/sewer capacity has become critical path item in competing for significant economic development projects. Our panel of water/sewer experts will discuss a variety of smart-growth concepts, with a key focus infrastructure investment, such as:

The value and mechanisms of inter-municipal agreements;
The process to build and maintain water/sewer infrastructure; and
Outside-the-box approaches to maximizing existing infrastructure.

Orange County is on the path to play a critical role in the resurgence of advanced manufacturing and technology development in the Northeast. The discussion will be important for anyone that’s interested in advancing smart development for their clients or communities.

It's Time to Move Forward for Safety and Sustainability in the Hudson Valley

Efforts are underway to enhance mobility on Route 17 in Orange and Sullivan counties by adding a third lane east and west and making other necessary upgrades to this critical corridor in our region. The Orange County Partnership has long supported this effort and, as a founding member of the 17-Forward-86 Coalition, has been a vocal advocate for moving this project forward.

The New York State Department of Transportation (NYSDOT) on Jan. 17, 2024 hosted two public information sessions to provide details on updating Route 17 to convert the corridor to Interstate 86. More information is available here.

Enhancing safety and improving mobility on Route 17 is of paramount importance, and we cannot afford further delays to this long-overdue project. The NYSDOT has been very responsive to local concerns and has addressed considerations ranging from safety, the environment, quality-of-life and projected financial costs.

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From left, Adam O'Gorman of Nova North Commercial, John Lavelle of Rand Commercial and Steven Salomone of Houlihan Lawrence Commercial.

(Photo Credit: John Vecchiolla)

Rand Commercial's Lavelle Predicts 2 Million SF in Transactions in Orange County This Year

At a broker roundtable discussion of the Hudson Gateway Association of Realtors’ Commercial Investment Division, Rand Commercial’s John Lavelle shared that Orange County’s industrial real estate market was strong in 2023 and is expected to remain that way this year.

“Quite frankly, business has been good the past few years. We have done very well, thankfully. Clearly far and away, the most active sector of the Orange County commercial real estate market is the industrial market.”

He continued, “In 2023 alone we had 3 million square feet of warehouse buildings under construction. That’s a really good year for us.”

Lavelle noted that of the 3 million square feet being built, a total of 2.4 million square feet are already leased or spoken for. While nationwide, approximately 25% of industrial space in development is pre-leased, Orange County’s rate is approximately 60%.

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Supply Chain Compaction in Orange County

The United States is experiencing a manufacturing renaissance – clean tech, semiconductors, food and beverage, and other sectors are tied to the on-shoring real estate phenomenon that we’re experiencing. At the Orange County Partnership, we’re committed to fostering, what we call, the “next generation economy” in Orange County. An economy that is intimately tied to leveraging the macroeconomic investment environment, coupled with regional assets, to become an advanced manufacturing hub in New York State. We’re actively working on new leads in food and beverage, packaging, and clean tech – all manufacturing centric projects.

For the last few years, supply chain disruption has fundamentally changed the way we think about real estate site selection. Whether it be COVID complications or now, conflict in the Red sea, the ability for companies to optimize their supply chain is on the mind of C-suite executives from across the globe.

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Industrial Markets Headed for Equilibrium in 2024 After Two Years of Unprecedented Growth

While the U.S. industrial real estate markets are expected to continue to shift as they deal with a massive amount of new supply coming to the market, several analysts are expecting the difficult conditions to be temporary thanks in large part to strong demand.

The past few years has seen unprecedented leasing and investment demand that pushed vacancy rates to record lows. Entering 2024, Colliers National Director of Industrial Research Craig Hurvitz reported that the U.S. industrial vacancy rate increased during all four quarters of 2023, climbing 195 basis points to 5.6%—the highest since 2016.

Record new supply nearly tripled net absorption for the year as demand normalized to 2019 levels. However, he noted that while industrial vacancy rates will rise this year, construction starts have rapidly dropped off recently and the result of the quickly contracting construction pipeline will result in the equilibrium between supply and demand returning by the end of this year.

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FEATURED PROPERTIES OF THE MONTH:

Looking to relocate or expand your company? Reach out to our Vice President of Business Attraction, Conor Eckert today! 845.294.2323 or conor@ocpartnership.org

180,000 SF WAREHOUSE/DISTRIBUTION SPACE FOR LEASE

3 ENTERPRISE DRIVE | NEWBURGH, NY

Can be divided into 2 possible spaces of 80,000 SF and 100,000 SF
Direct highway access to I-84 and I-87
Prime location - adjacent to NY Stewart International Airport
Proximity to major industrial partners including: Tesla, AmerisourceBergen, FedEx, UPS, etc.

NEW SHOVEL READY SITE | MONTGOMERY, NY

146,075 SF SPEC BUILDING AVAILABLE FOR LEASE

Q4 2024 DELIVERY

Ridgecut Road recently secured approvals for a 146,075 SF spec industrial building in the Town of Montgomery, just 0.25 miles away from I-84.

This site is located within one of the more robust industrial ecosystems in the Northeast, just 65 miles from NYC and Port Newark– with industrial neighbors including Staples, Home Depot, FedEx, Amazon, XPO, Cardinal Healthcare, Medline, McKesson, UNFI, PharmaCannis, and others.