BETHLEHEM, PA-Ashley Development Corp. has completed negotiations with Wyomissing-based Sovereign Bancorp Inc. to acquire two Lehigh Valley Sovereign Bank locations. Because the transaction documents are incomplete, the sale price is undisclosed and not yet in the Lehigh County public records.

Under the sale-leaseback agreement, Sovereign will remain under 10-year, triple net leases and relocate its regional offices from one of the locations to the other. Both branches will remain in operation while Ashley’s redevelopment and renovations are underway.

The existing single-story, 2,840-sf branch here at 924 Eaton Ave. will be razed for construction of a new 17,325-sf, three-story building that will include a branch and offices for Sovereign’s Lehigh Valley regional headquarters. The existing branch was built in 1965. The $3-million redevelopment project is expected to be complete by 2009. Meanwhile, the Sovereign branch will continue to operate at this location using a temporary facility.

The new building complements a pair of medical office facilities, recently completed by Ashley. “The redevelopment of the Sovereign Bank regional office helps to solidify the Eighth Avenue corridor as a main artery of professional and medical offices,” says Duane Wagner, EVP of locally based Ashley, in a statement.

The second property is a five-story building at 100 N. Third St. in Easton, where Sovereign’s regional operations are now located along with a first-floor branch. Sovereign will continue to occupy space on the second and third floors under a short-term lease until the new Bethlehem office is completed.

Renovation plans for this 37-year-old building have been approved. Ashley will begin retrofitting the office space in April. A call to Wagner was not returned by deadline.