ALLENTOWN, PA-Ground has broken for the DHL East Coast distribution center here, a 502,000-sf facility. The estimated construction cost, including internal letter and package handling systems, is $107 million, according to Craig Guers, VP and general manager of Plymouth Meeting-based Opus East, which is the developer of the build-to-suit center.

Opus East is retaining ownership of the facility and has signed an agreement to rent it to Plantation, FL-based DHL for 20 years. Guers declined to disclose the rental rate or aggregate value of the lease. In a second-quarter 2005 report, the Philadelphia office of Trammell Crow Co. puts the average asking rental rate for industrial space in the Lehigh Valley at $3.81 per sf, up three cents per sf, compared with the previous quarter. Second-quarter data from the area office of CB Richard Ellis, however, puts the current average asking rate at $4.02 per sf, down seven cents from the opening quarter of this year.

Guers tells GlobeSt.com the building "is DHL's largest and most automated North American facility." It has a 290,000-sf footprint and includes 200,000 sf of workspace on a mezzanine floor along with 12,000 sf of office space.

According to a DHL statement, the center will have a handling capacity of 40,000 letters per hour and 50,000 packages per hour, and, by the end of this year will service 57 stations in 10 regional hubs across the US. In the statement, Steve White, SVP of hub and gateways for DHL, says this facility "is part of our ongoing network investment program," a program launched in June 2004 at a total investment of $1.2 billion.