Allentown Economic Development Corporation

Monthly Archives: December 2018

2018 Year in Review – Overview

AEDC discusses manufacturing and retail job outlook with state elected officials and regional economic developers

Entitled “Where are the jobs?” it featured representatives from regional economic development, municipal, and union organizations who shared their expertise on how things like automation in manufacturing and the growth of online sales are impacting the job market landscape in the region. The goal was to offer information and direction to the legislators in attendance on how they might enact policies to encourage growth and ensure job creation and retention.

The sentiment across the panel was that changes were happening in the manufacturing and retail sectors that can’t be stopped, so the best that can be done is to learn to adapt and embrace them.

Allentown Metal Works another step closer to redevelopment

The Southside brownfield site continues to make progress as AEDC prepares it for a future tenant. Over the past year, selective demolition has been completed on 58,000 square feet of buildings that were determined to be functionally obsolete. That leaves three buildings on the site, which total more than 200,000 square feet to be renovated in several phases.

The second round of environmental remediation was also completed to address areas of lead-based paint and asbestos. An environmental covenant was executed and recorded with the Pennsylvania Department of Environmental Protection, which is the culmination of the Act 2 Land Recycling Program. Site development specialists Pennoni of Philadelphia have begun working on a development plan for the reuse of the site, as well as renovations for the first of the three buildings. They expect to have the first building ready for tenant fit-out in 2019.

A $500,000 Commonwealth of Pennsylvanian Redevelopment Assistance Capital Program grant will be used for the installation of wall and ceiling insulation, and roof, door, and window replacement in a 52,000 square foot building at the site. Of the three buildings remaining on the site, this building has been deemed a priority due to its potential to house a heavy steel fabricator or similar manufacturer, support a 25-ton overhead crane, and employ up to 75 skilled laborers. Together the three remaining buildings total more than 200,000 square feet on 17 acres, with renovations planned to take place in phases. The entire site’s rehabilitation is estimated at $22 million, including infrastructure improvements such as new utility laterals for the entire complex.

PPL Provides Foundation Grant to Support Economic Development

AEDC received a $5,000 contribution to support its economic development programs from the PPL Foundation. The funds will be used toward the nonprofit organization’s mission, which is divided into three primary activities: industrial property redevelopment and management, business incubation, and business retention and expansion. AEDC has returned more than 30 acres of vacant or underutilized properties back onto the tax rolls of the city, reducing blight and creating local manufacturing jobs. Currently, AEDC owns, operates, or manages 62 acres of property with over 1.7 million square feet of building space.

AEDC Launches Sponsorship Drive

The Bridgeworks Sponsorship Drive will help raise some of the funds needed to supplement AEDC’s annual capital improvement budget. This includes maintenance of the former Mack Trucks assembly plant that houses its Bridgeworks Enterprise Center business incubation program, and periodic improvements to the infrastructure, such as energy efficiency upgrades and replacing the building’s fire alarm and access systems.

Sponsorship levels include:

  • Office Sponsor – $1,250 (18 available)
  • Conference Room Sponsor – $3,500 (1 available)
  • Manufacturing Suite Sponsor – $5,000 (15 available)
  • Incubator Sponsor – $10,000 or more

Each sponsorship level comes with its own series of benefits.

To learn more about the AEDC Bridgeworks Sponsorship Drive, contact Scott Unger – or 610-435-8890.

2018 Year in Review – Lending Programs Overview

Each year AEDC empowers local businesses to grow and expand through the two loan programs it administers, the Allentown Enterprise Zone Revolving Loan Fund and the Pennsylvania Minority Business Development Authority Revolving Loan Fund.

AEDC begins administering PMBDA loans for Lehigh Valley

In February, AEDC became the official administering agency for the Pennsylvania Minority Business Development Authority Revolving Loan Fund. It already administered the loans for Lehigh County and assumed regional duties from Lehigh Valley Economic Development Corporation.

The loan program’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, real estate acquisition, new construction, rehabilitation, and engineering, architectural, legal and other related costs. Last year, the PMBDA program guidelines expanded the spectrum of who can apply for the loan to focus on ethnic minorities to include socially or economically disadvantaged persons.

Spotlight: Lehigh Human Support Services

Human services entrepreneur Adewale Dosunmu started Lehigh Human Support Services to provide residential support and respite services for people with intellectual disabilities. In 2017 he officially incorporated LHSS and received his state certification on December 8, 2017. The business officially started on June 8, 2018, with four homes: two in Allentown, one in Macungie, and another one in Breinigsville.

Having spent much of his own capital purchasing the initial locations, Dosunmu needed gap funds to support the business period between its first billing and the payment of invoices. AEDC assisted him in securing a $75,000 working capital loan was made possible by utilizing both the Pennsylvania Minority Business Development Authority program and the Allentown Enterprise Zone Revolving Loan Fund.

So far Dosunmu has created 19 jobs, the majority of which are full time, and he expects to hire more in the future as the company grows. He offers his employs an hourly rate that is nearly double the minimum wage because he believes in compensating employees well so that they stay.

Spotlight: Center Stage

Center Stage Lighting & Rigging, Inc. in Allentown expanded thanks in part to a $100,000 Allentown Enterprise Zone Loan which was used to buy new lighting, sound, and staging equipment. The loan prompted the company’s move to a larger space next door to its existing office, which will take it from 3,000 sq. ft. to 8,000 sq. ft. and will add a showroom.

Center Stage handles stage, lighting, and sound production for shows from designing the sets, to setting it up and taking it down. It also rents equipment, performs installation, and does equipment sales. The business works with area concert halls, event centers, theaters, colleges, and high schools.

Spotlight: State Farm Representative Rafael De La Hoz

Pennsylvania Minority Business Development Authority loan allowed Rafael De La Hoz to take his 3-year-old insurance agency to the next level by purchasing an office building down the street from where his office was located on the city’s south side. 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 had over 1,000 customers.

Knowing he needed to expand, he found a building for sale situated on a high-traffic road and approached several area banks for a loan only to find that all of them had a 20 percent down policy and higher interest rates than he could afford. He then discovered the PMBDA loan program and worked with David Dunn of AEDC on the loan application, which resulted in a 15-year loan at a rate that was about half of what the banks had quoted him. The sale of the property closed in March and De La Hoz moved into his new office in May.

How to apply for a loan

What do you need to do to prepare to apply for a loan? Before you put pen to paper you should spend time gathering information and preparing for the larger broad questions that are often asked about your business. Here are some things you should have and do:

Preliminary Information:

  • Are you formally incorporated as an LLC, C, or S-Corp?
  • Do you have a DUNS number?
  • Do you know your NAICS code(s)?

Financial Information:

  • Accurate and current financial statements
  • Business and personal financial statements and tax returns
  • Current and projected cash flow statement
  • Collateral

Read the rest of the article to find out what you need to prepare HERE.

2018 Year in Review – Bridgeworks Enterprise Center

Bridgeworks Enterprise Center is the only business incubator in the Lehigh Valley dedicated primarily to manufacturing startups ranging from advanced plastic polymer formulation to sophisticated design engineering and rapid prototyping techniques. Its goal is to provide the resources to help startups move from the launch process to self-sustaining profitability, then to graduate them into the City of Allentown or into a suitable site within the greater Lehigh Valley.

Startups at Bridgeworks Enterprise Center Continue Steady Growth in 2017

The results of the annual Incubator Client Impact Survey showed that in 2017 the 10 Bridgeworks client companies earned over $4.63 million in revenue, which is a 4.6 percent increase over 2016. Collectively the companies employ 28 full-time employees and another 46 people as either part-time or contracted employees. Total salaries, wages and contractor fees paid to these employees increased by 2.6 percent to $1.31 million.

The incubator clients are employing nearly three times the number of people and paying out more than 41-times the salaries and wages that they did in 2012, by comparison. Revenues earned by the client companies are also up by 2.5-times. Today the Bridgeworks Enterprise Center is 85 percent occupied.

The annual impact survey of the client companies participating in the Bridgeworks Enterprise Center business incubator program gathers important data on job creation, company revenues, and obtained loans, grants, and equity investments. That data is aggregated into a report that demonstrates the economic impact that the incubator has on the Allentown and Lehigh Valley communities.

Bridgeworks receives IMPACT Award from InBIA

AEDC and its Bridgeworks Enterprise Center were recognized by the International Business Innovation Association when they 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.

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.

Spotlight: Polymer Contours

Polymer Contours Owner Tyson Daniels made his company automated one year ago this month by purchasing two robots that allow two of his three machines to run 24 hours a day, seven days a week producing parts for his customers. His operation is now 60 percent automated, and as a result, he says he’s on track to reach his goal of $1 million in sales by the end of 2018, his fourth year in business. The two robots have allowed the business to not only meet demand but to double its capacity by producing in six days what used to take a month to run.

Daniels also brought in an engineering consultant to teach him and his team about cycle time and how to reduce production time by increasing consistency and utilizing machine effectiveness through scientific testing. As a result, they were able to reduce production time by 33 percent for one of their largest jobs, which meant reducing times from 18 seconds per shot to 12 seconds. That can save the company over $50,000 a year and reduce the time it takes to fill an order by an entire day.

Looking ahead, Daniels would like to get into rapid prototyping using quick-change systems to deliver molded parts quicker and within the same timeframe of a 3D printed part since they are a more accurate representation of a finished product and can be cost-effective using custom mold frames with interchangeable inserts.

Spotlight: TRuCapSol

In May, TRuCapSol (Time Release Capsule Solutions) joined Bridgeworks as its newest client and held a grand opening for its laboratory in November.

The company takes high-value actives, uses their materials expertise to encase them to form micron-sized balloons, so that the balloons retain the active in the supply chain, then release the active over a duration of time. TRuCapSol is focused on utilizing natural materials, which allows them to produce environmentally friendly, world-class capsules. By utilizing their patented technology and production processes, TRuCapSol decreases waste and improves the effectiveness of the formulations delivered to its customers. The company’s initial product line will focus on the consumer goods space, specifically laundry products such as detergents, fabric softeners, etc.

TRuCapSol comes to Bridgeworks by way of Ben Franklin Technology Partners of Northeastern Pennsylvania. The company launched their research and development efforts at the TechVentures incubator in Bethlehem before relocating to Bridgeworks to scale up their operations. It has six scientists working out of the Bridgeworks location.

The importance of face-to-face time with your potential customers when starting a business

Guest column by Anthony Durante, Program Manager, Bridgeworks Enterprise Center

If you have a quality product that solves a painful problem for a lot of people, then you can probably build a company around making that product. Ironically, this seems to be one of the primary stumbling blocks for many of the prospective entrepreneurs that I come across.

As an entrepreneur, you need to validate your assumptions as quickly and inexpensively as possible. This means getting out in front of your customers, asking simple basic questions, and listening carefully to the answers. Obviously, some of the key discoveries you can make through this process are:

  1. The customer really doesn’t have the problem.
  2. The problem isn’t as big as was originally expected.
  3. The proposed solution misses the mark in a major way.

Although these discoveries may sound catastrophic, it’s extremely important to learn them very early on in the process. Otherwise, considerable amounts of time and money may be wasted on creating something no one will buy. At the same time, by getting this information you can redirect your efforts to build the ideal product that solves a big problem in the market.

Learn what types of questions you should be asking and what else can be discovered during this process by reading the full blog post HERE.

Lessons Learned from Bridgeworks Graduates

We asked three Bridgeworks alumni – Meet Michael Grather, President of LightLab International Allentown LLC, Stephen Maund, President of Demco Automation, and Terry Rufer, President of ColdEdge Technologies– for their perspectives on the following three questions:

  1. What is one thing you did that really helped the company take big steps forward in growth?
  2. What is the one thing that you thought was a good idea at the time but didn’t work out as well as you expected it would?
  3. If there was something you could do over again with your company, what would it be and why?

Go HERE to read their responses and share their insights.

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