Following an evaluation for Upper Merion Township’s King of Prussia Business Improvement District (BID) of local tax policies, Econsult Solutions, Inc. (ESI) was retained by the King of Prussia Business Improvement District in 2012 to provide an analysis of the employment and comparative office markets.
ESI compared the employment mix of Upper Merion to that of other locations in the Philadelphia region that are considered competing business locations for the Township, namely: Tredyffrin, Malvern, and Newtown Square. Additionally, ESI compared the Township’s King of Prussia / Valley Forge (KOP/VF) commercial office market to the Southern Route 202 (SR202), Main Line / Radnor / St. David’s (ML/R/SD), and Conshohocken office markets.
New construction has slowed, rental rates have reached a plateau, and property tax revenues within Upper Merion Township are flat. Meanwhile, the Southern Route 202 Corridor and Conshohocken have had higher net absorption in recent years, and Tredyffrin has doubled the number of jobs located within its jurisdictions. ESI found that the KOP/VF commercial office market has been losing pricing power for over a decade and that all three competing markets have seen increases in Class A rents relative to rents in the KOP/VF commercial office market.
These findings led ESI to provide a framework for the King of Prussia District to work with Township Supervisors to improve its competitive position as an employment and office market location of choice. ESI recommended a five-part approach, focusing on accessibility and improving traffic, leveraging KOP-BID’s competitive edge, articulating a distinct value proposition focusing on advantages of the Township, articulating a distinct value proposition focusing on ease of development, and pursuing tax reform strategies to minimize its current disadvantage against jurisdictions with lower tax burdens.
