Scranton PA fires & other observations

[Roberto Westerband]

Hi BP world, 

I recently went to Scranton and saw some properties with potential for buy/hold cash flow, but I noticed a few things on my trip there and I'm wondering if anyone has/is investing in the area and their outlook:

1) There are lots of commercial vacancies in the area

2) It seems there have been quite a few fires recently, all of which seem to end up being arson

3) Anyone familiar with how the landlord/tenant court waiting period in the area is for worst case scenarios (i.e. evictions)?

[Chris K.]

@Roberto Westerband

1. Commercial vacancy wise, I think the downtown area is fine. There are enough restaurant, coffee shop, type businesses there. Retail is suffering but that's basically true everywhere. Most industrial businesses are outside the city limits. 

2. No idea about the fire. Can't say I noticed it. 

3. I never noticed it being terribly slow at the magistrate level. Court of common pleas can drag but the tenant is supposed to escrow the rent during this period so there is some protection there.

This doesn't directly relate to your question, but I always recommend that people take a look at the metropolitan statistical area to get a general sense of where they are investing. Here's a link on Wikipedia --- no idea if it is accurate based on recent estimates. 

https://en.wikipedia.org/wiki/Pennsylvania_metropo...

As you can see, Philadelphia and Pittsburgh area are clear 1A and 1B. Allentown area is next, followed up by the next set of areas with populations around 400k to 500k. The Scranton-Wilkes-Barre area is one of them. All of this suggests to me that the area is a tertiary market. With the risk of offending anyone, all tertiary markets are tertiary markets. If you can succeed in one tertiary market (say Lancaster), you probably could succeed in another similar market as well (say Wilkes-Barre or Scranton). 

I'm not saying just go random properties in a given area since there are different levels of desirability within each area. But I also think it's hard to say that one tertiary market is clearly better than another. They are all tertiary markets because 100 of different factors places a cap on their desirability. 

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.