Allentown Economic Development Corporation

Monthly Archives: March 2018

Transloading gives Allentown manufacturers additional shipping options

If you’re a manufacturer who thinks they can’t access freight lines for the shipping of the goods you produce, or for receiving the goods you use to make your products, then consider transloading.

Transloading Overview

You’ve probably already heard about intermodal transportation, so it’s important to first understand the difference between transloading and intermodal.

With intermodal transportation, cargo is loaded into a transportation container, which is then shipped using one or more methods of transportation without the cargo being unloaded from the container.

With transloading, the cargo is also shipped using different modes of transportation, however, it is loaded and unloaded between the various modes. It’s most often used when one method of transportation can’t work for the entire trip, usually involving international shipments, but can also work for domestic ones. For instance, cargo may leave the manufacturer on a train but is then offloaded to trucks or planes for final delivery.

What types of products are best for transloading?

“Products that are ideal for transloading include palletized commodities which can be loaded and unloaded in a boxcar,” explained John Gogniat, Director of Commercial Development for R. J. Corman Railroad Company, LLC. R. J. Corman owns 11 Class 3 short line railroads in the Mid-Atlantic and the South, as well as the Allentown Rail Yard located off Basin Street in Allentown where it handles cargo for clients that are shipping their goods by train.

“In addition, products such as lumber or steel that can be unloaded with a forklift are ideal candidates,” Gogniat continued. “That said, we are open to entertaining any potential commodity and will develop a mutually desirable solution for its loading and unloading.”

Norfolk Southern is a Class I railroad that serves every major container port in the eastern United States and provides efficient connections to other rail carriers. One of Norfolk Southern’s major lines runs through the Lehigh Valley region and serves the Allentown Rail Yard. Norfolk Southern works in close partnership with R. J. Corman to transport client goods throughout the region.

“Norfolk Southern connects with more than 200 short line railroads. We interchange with R. J. Corman at several locations throughout our system and we look forward to assisting in serving our mutual customers in Allentown,” said Denise Bailey, Short Line Development Manager for Norfolk Southern Corporation.

A cost-effective shipping method

In general, rail is a more efficient method of transportation. Depending on volume, distance, weight, and other factors it can be more cost-effective for manufacturers to bring raw materials to their facility by rail instead of trucking it in. It can also be more cost effective to ship out the finished product in bulk via train than by truck since trains are more efficient at moving large loads.

The Allentown Rail Yard

“Norfolk Southern’s Allentown Yard is one of the largest in their system, and we’re very fortunate to have it in Allentown,” said Scott Unger, Executive Director of Allentown Economic Development Corporation. “There are nearly 200 manufacturers in the city of Allentown, but only a few of them use rail for the transportation of their goods, and I’d like to see if more of them can benefit from rail service.”

Only a short distance from the Norfolk Southern Allentown Yard, R. J. Corman’s Allentown Yard offers boxcar unloading, bulk transloading, laydown space, and oversized load handling. There’s also onsite ground storage and general warehouse space for cargo located inside a fenced and well-lit area. It has the space to handle bulk commodities and forklifts to offload cargo from rail cars. Its strategic location provides access to Philadelphia, Scranton, York, Harrisburg, Wilmington, New York, and beyond.

“Our operation provides customers that don’t have the ability to enjoy the benefits of rail the ability to access the rail network, which gives them more modal options from which to choose,” said Gogniat.

State grant program for spurs

The state’s Bureau of Rail Freight administers a special grant program called the Rail Freight Assistance Program, which provides financial assistance to companies that are interested in bringing a railroad spur directly to their property for freight shipments. The goal of the grant program is to preserve and stimulate economic development through new and expanded rail service.

Location of the manufacturer in relation to the nearest railroad is a key consideration from a logistical standpoint. Manufacturers that are interested in learning more about the program can go HERE to learn about it.

If you have questions or would like to investigate rail options for your business, please feel free to contact us.

Scott Unger, Executive Director
Allentown Economic Development Corporation

John Gogniat, Director of Commercial Development-RJCP, RJCN, RJCL, RJCW
R. J. Corman Railroad Company, LLC

Denise Bailey, Short Line Development Manager
Norfolk Southern Corporation

PMBDA loan helps Allentown insurance agency grow

When Rafael De La Hoz came to America from Colombia in 2004, he never envisioned he’d live in Pennsylvania and become a successful businessman in a city called Allentown, which he had never heard of before. Yet today he is living the American dream as the head of a successful State Farm agency in the Queen City.

A recent Pennsylvania Minority Business Development Authority loan is allowing him to take his business to the next level by purchasing an office building down the street from where his office is currently located on the city’s south side.

Time to grow

De La Hoz knew he needed a bigger office space, but at first, he wasn’t interested in buying a building. After looking at rents in the area and checking out a few places, he identified a property for sale. The 2,300 sq. ft. building on 4th Street is in a high-profile location across from a supermarket and strip mall. So he began contacting banks about loans. All of them had a 20 percent down policy and higher interest rates than he could afford.

Then he discovered the PMBDA program and worked with AEDC Program Manager David Dunn to apply for the loan.

“The 15-year loan at 4.5 percent is about half of what the commercial banks were telling me my rate would be, plus 20 percent down, which I didn’t have.”

“Rafael represents the entrepreneurial spirit of America,” said Dunn. “While at his early stage of business he may be outside traditional lending standards, he has the drive, determination and prospects to succeed and we are glad to be a part of his growing success.”

Administered by Allentown Economic Development Corporation on behalf of the Commonwealth, the PMBDA loan’s objective is to stimulate growth and expansion of minority-owned businesses and to create jobs in Northampton and Lehigh Counties. Loans of up to 90 percent of the eligible project cost (or $250,000, whichever is less) can be used for machinery and equipment costs, land costs to purchase, renovate, or for new construction. It can also be used for building acquisition, construction, rehabilitation, engineering, architectural, legal and other related costs.

Filling an unmet need in the community

De La Hoz opened his agency in August 2016 to fill a need for the Hispanic community in Allentown, and just over a year and a half later, he has over 1,000 customers. “There were State Farm agents with Spanish-speaking staff members, but none of the agents where Spanish-speaking, and there were no Latino agents in a city with a very large Latino population.”

The sale of the property closed on March 9, but De La Hoz won’t move into his new office until Memorial Day Weekend after the lease on his current office space ends. That will give him the time he needs to ready the space for his staff of three, which he hopes to grow to five or six in the coming years now that he has more space.

“When I followed my father here many years ago with almost no money in my pocket, I didn’t know what would become of me,” said De La Hoz. “I applied for jobs for almost a year before finally getting into banking as a teller and then as a manager. I worked in financial services for 13 years before transitioning to insurance sales with State Farm and it’s the perfect fit for me. I love what I do. I have a passion for it, and that passion transfers to my customers. I’m very happy with the PMBDA loan I received and am excited about the future of my business.”

AEDC Bridgeworks Enterprise Center Recognized for Excellence by International Association

The Allentown Economic Development Corporation and its Bridgeworks Enterprise Center were recognized by the International Business Innovation Association on Friday when it received the IMPACT Award for February 2018. The monthly award distinguishes entrepreneurship centers that are creating economic impact in their communities through a robust variety of programs, spaces, and services that serve the entrepreneurs and early-growth companies that are the engines of job creation.

“Manufacturing remains a very significant part of both Allentown’s economy and the economy of the Lehigh Valley,” said AEDC Executive Director Scott Unger. “We are extremely proud to have our incubator program selected from and by our global peers.”

Bridgeworks received the award along with five other incubator programs around the world. It was recognized in the Specialty category which is for programs that have a unique focus, in this case manufacturing. Other categories are technology, mixed-use, university, rural, and biotech/cleantech.

By receiving the IMPACT Award, Bridgeworks is now eligible for one of the InBIA annual awards: one of two Dinah Adkins Incubator of the Year Awards – one for technology and one for non-technology entrepreneurship programs – and the Randall M. Whaley Incubator of the Year Award.

“We have worked steadily to elevate both the facility and the programming at the Bridgeworks Enterprise Center over the past few years,” explained Anthony Durante, AEDC Program Manager. “When Kirstie Chadwick, President and CEO of InBIA, visited us last fall I think she was surprised and impressed by what we were doing. We’re excited that InBIA has recognized our dedicated efforts.”

The Bridgeworks Enterprise Center is the business incubation program managed by AEDC who founded the program by refurbishing the 64,500 square-foot Mack Trucks Plant 4A in 1989. Over the course of its 29-year existence, the Center has helped launch more than 61 companies in Allentown that have created more than 618 jobs.

Today, the Center is home to eight incubator clients and three anchor tenants. Additionally, several small firms and independent professionals utilize its Flex Office & Coworking space and Make Lehigh Valley occupies and operates the facility’s makerspace. In 2017, the incubator clients earned more than $4.66 million in revenue, employed 51 FTE positions, and paid out more than $1.31 million in salaries and wages. The Bridgeworks Enterprise Center is home to Amorphic Tech Ltd., ColdEdge Technologies, The Colony Meadery, County Seat Spirits, HiJinx Brewing Company, JH Plastics, LightLab International Allentown, MTS Design & Manufacture, Polymer Contours, and Zzyzx Polymers.

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