A New Crop in Pennsylvania: Warehouses

Huge facilities have sprouted up in and around the Lehigh Valley, fueled by the astonishing growth of e-commerce. Some residents say the area’s landscape and long-term economic health could be threatened.

Published May 26, 2021 Updated May 27, 2021

OREFIELD, Pa. — From his office in an old barn on a turkey farm, David Jaindl watches a towering flat-screen TV with video feeds from the hatchery to the processing room, where the birds are butchered. Mr. Jaindl is a third-generation farmer in Pennsylvania’s Lehigh Valley. His turkeys are sold at Whole Foods and served at the White House on Thanksgiving.

But there is more to Mr. Jaindl’s business than turkeys. For decades, he has been involved in developing land into offices, medical facilities and subdivisions, as the area in and around the Lehigh Valley has evolved from its agricultural and manufacturing roots to also become a health care and higher education hub.

Now Mr. Jaindl is taking part in a new shift. Huge warehouses are sprouting up like mushrooms along local highways, on country roads and in farm fields. The boom is being driven, in large part, by the astonishing growth of Amazon and other e-commerce retailers and the area’s proximity to New York City, the nation’s largest concentration of online shoppers, roughly 80 miles away.

“They are certainly good for our area,” said Mr. Jaindl, who is developing land for several new warehouses. “They add a nice tax base and good employment.”

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But the warehouses are being built at such a dizzying pace that many residents worry the area’s landscape, quality of life and long-term economic well-being are at risk. E-commerce is fueling job growth, but the work is physically taxing, does not pay as well as manufacturing and could eventually be phased out by automation. Yet the warehouses are leaving a permanent mark. There are proposals to widen local roads to accommodate the thousands of additional trucks ferrying goods from the hulking structures.

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David Jaindl is a third-generation farmer who also develops land across the region.Credit...Erin Schaff/The New York Times

In the township of Maxatawny, Pa., just west of the Lehigh Valley, a giant warehouse is slated to be built at the site of a 259-year-old cemetery that holds the remains of a Revolutionary War captain and what is believed to be the unmarked grave of a woman he had enslaved.

Not far away, near a group of Mennonite farms, a tractor-trailer hit a horse-drawn buggy in late March, flipping it and sending one passenger to the hospital and the horse on the loose.

Closer to Allentown, the area’s largest city, FedEx has built a new “ground hub,” one of its largest such facilities in the United States. A billboard down the road advertises legal representation for people injured in truck accidents.

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“They are coming here and putting up shiny new warehouses and erasing pieces of history,” said Juli Winkler, whose ancestors are buried in the Maxatawny cemetery. “Who knows if these big buildings will even be useful in 50 years.”

Developers are very confident in the industry’s growth, however, particularly after the pandemic. Big warehouse companies like Prologis and Duke Realty are investing billions in local properties. Many of the warehouses are being built before tenants have signed up, making some wonder whether there is a bubble and if some of these giant buildings will ever be filled.

“People are calling it warehouse fatigue,” said Dr. Christopher R. Amato, a member of the regional planning commission. “It feels like we are just being inundated.”

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Warehouse and transportations jobs rival manufacturing jobs in the region, though they pay less on average.Credit...Erin Schaff/The New York Times

There are now almost as many warehouse and transportation jobs in the region as manufacturing positions. But that’s not a milestone all celebrate — not in an area that hopes to keep alive its higher-paying manufacturing sector, even though some of its biggest employers like Bethlehem Steel closed long ago.

Manufacturing jobs in the Lehigh Valley pay, on average, $71,400 a year, compared with $46,700 working in a warehouse or driving a truck. The region is still home to large manufacturing plants that produce Crayola crayons and marshmallow Peeps candies.

Don Cunningham, the chief executive of the Lehigh Valley Economic Development Corporation, says the warehouse jobs are lifting employment and wages, particularly for unskilled workers.

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“If you were to turn away this economic opportunity for a whole sector of workers, where do they go?” Mr. Cunningham said. “They could end up on some sort of government assistance or end up caught up in the criminal justice system.”

Mr. Cunningham, whose father worked in the local steel industry, said he recognized that distribution jobs were not ideal.

“But to be able to make $16 an hour with a high school diploma, there aren’t a lot of places in the U.S. where you can do that,” he said. “This is a really nice sector for low-skilled workers. It at least gives them a fighting chance to carve out a livable wage.”

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To accommodate the thousands of additional trucks on the local roads, there are proposals to widen some routes.Credit...Erin Schaff/The New York Times

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Don Cunningham, the chief executive of the Lehigh Valley Economic Development Corporation, says the warehouse jobs are boosting employment and wages.Credit...Erin Schaff/The New York Times

A depot on the global supply chain

To Kirk R. Johnson, the Lehigh Valley is a dreamscape. There is available land, but not too much, which helps keep values high. Two major interstates pass through the area ferrying goods through the Northeast. About 30 percent of American consumers are within a day’s truck drive.

Looking for an opportunity to invest, Mr. Johnson, the chief investment officer of the Watson Land Company, a giant owner of warehouses in Southern California, teamed up with Mr. Jaindl. Together, they are developing three new warehouse projects around the Lehigh Valley, totaling more than three million square feet, or about 60 football fields. They are being built speculatively, meaning no tenants are lined up.

Credit: Michael Corkery is a business reporter who covers the retail industry and its impact on consumers, workers and the economy. He joined The Times in 2014 and was previously a reporter at the Wall Street Journal and the Providence Journal. @mcorkery5