BETHLEHEM, Pa. — What once was a long-vacant, deteriorating building on East Third Street is being reimagined as a mixed-use anchor in South Side’s ongoing revival.
Now dubbed The Emerald on Third, the three-story property at 13-15 E. Third St. has undergone a near-total reconstruction by local real estate agent Neel Shah and his partner, contractor and investor Emmanuel Patricio.
The pair describe the effort as a full gut renovation of roughly 17,000 square feet, transforming a structure that had sat largely abandoned into a flexible commercial and residential space in the heart of Bethlehem’s Southside Historic Conservation District.
The property now is up for sale or lease. Zoning approval for five residential units would transfer with the sale.
“When we first saw it, you didn't see much potential because it was almost destroyed,” Shah said during a recent walkthrough.
“But then you start putting things together — what can be done, what the area needs, and whether it makes sense financially.”
That calculation led to an eight- to nine-month construction effort that began last summer.
Stripped to the studs
Inside the building, virtually everything was stripped to the studs. Floors were leveled after crews discovered severe structural sloping.
Walls and ceilings were removed to expose original brick and beams, features the developers ultimately chose to highlight rather than conceal.
"I like to take the last bad property on the block and make it really nice.”Emmanuel Patricio
The building’s condition at purchase underscored the scale of the undertaking. Broken windows let people enter freely, and debris filled much of the interior.
“One day we walked in after we bought it, and there was just a couch sitting inside,” Shah said.
Patricio said the property stood out not just for its condition, but for its location.
“This was like the last abandoned building in the neighborhood,” he said.
“People would walk by and it was an eyesore compared to everything else. I like to take the last bad property on the block and make it really nice.”
Adaptive reuse shapes city's next growth phase
Bethlehem Economic Development Director Sean Ziller said projects such as The Emerald on Third represent the city’s next phase of redevelopment, as available land for new construction becomes increasingly scarce.
“Because there is a limited amount of available space left citywide, you’re seeing a lot of these adaptive reuse projects,” Ziller said.
“It really drills down into a good relationship between these developers and property owners and the city to more readily address blight."Sean Ziller
Rather than building outward, Bethlehem’s growth is increasingly coming through the rehabilitation of aging and underutilized structures — a shift Ziller said requires stronger collaboration between developers and city officials.
“It really drills down into a good relationship between these developers and property owners and the city to more readily address blight,” he said.
That collaboration often begins before a redevelopment plan is finalized.
Ziller said developers increasingly are approaching the city and Bethlehem Economic Development Corp. early in the process to discuss what uses make sense for a site, what the market can support and what neighborhood needs remain unmet.
“What would you like to see and what does the market bear?” Ziller said developers now regularly ask.
For a project of this scale, he said, the city’s role is less about dictating outcomes and more about offering market analysis, trend data and insight into what types of uses have succeeded — or struggled — in similar spaces.
“We could offer these suggestions, and it’s up to whoever owns the property to say, ‘No, I’m gonna go down this route,’” he said.
The right fit for a prominent South Side site
Current plans for the property call for about 14,000 square feet of commercial space on the lower levels, with the potential for four or five residential units above.
A second-floor terrace and possible rooftop space could add to its appeal, whether as apartments or a destination business, developers said.
“We’re open to a lot of different uses,” Shah said. “Restaurant, gym, even a marketplace concept — something that fits the neighborhood.”
But Ziller said the building’s size presents unique leasing challenges compared with more traditional storefronts along Third Street.
Those larger commercial footprints require more due diligence, he said, particularly when evaluating whether the space is best suited for one major tenant, multiple businesses or a hybrid concept.
“It’s a very large space,” Ziller said. “Those are a bit more of a lift … versus maybe a smaller mom-and-pop space.”
The project also arrives as Bethlehem continues evaluating the future of its South Side Arts District, where officials are developing a strategic plan through a state Main Street Matters grant.
Ziller said that planning effort is intended to help guide redevelopment by identifying what residents, businesses and visitors want to see in the corridor.
“It’s as much a plan for that program as it is for that district,” he said.
Housing still part of conversation
The redevelopment comes amid broader concerns about housing affordability across the Lehigh Valley.
With demand high and supply constrained, new projects often draw scrutiny over whether they cater primarily to higher-income tenants.
Patricio acknowledged the residential units planned for The Emerald likely will skew toward the higher end because of construction costs and the property’s location.
But he said his broader portfolio includes lower-income and Section 8 housing elsewhere in the region.
“There has to be a mix,” he said. “There has to be upscale housing, but there also has to be opportunities for lower- and middle-income residents. It’s about balancing that.”
“The misconception would just be that a project that starts … is going to move quickly."Bethlehem Economic Development Director Sean Ziller
Ziller said Bethlehem is trying to strike that same balance citywide as it pursues affordable housing initiatives while also encouraging mixed-use investment in high-profile redevelopment sites.
“If we can increase the amount of folks who live in the community and work in the community simultaneously, I think that’s really important,” he said.
Still, Ziller cautioned that public expectations often fail to account for the complexity and timeline involved in major redevelopment projects.
“The misconception would just be that a project that starts … is going to move quickly,” Ziller said.
In reality, he said, adaptive reuse projects can take significant time depending on financing, permitting, tenant fit-out and the physical realities uncovered during construction.
The residential component, still pending permits, could move forward later this year if the building is not sold as a whole.
For now, The Emerald on Third stands as a visible example of how Bethlehem’s redevelopment is increasingly focused not on vacant land, but on reinventing the historic structures that remain.
“Once we started tearing things down,” Shah said, “we realized the building was way more beautiful than we thought.”
