Category Archive: Downtown Development
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Selling Pittsburgh’s Strip District
By Tony LaRussa
TRIBUNE-REVIEW
Friday, February 29, 2008Buzz up!
The deal is off.
The city is bagging plans to turn the produce terminal on Smallman Street in the Strip District into a trendy marketplace.
The Urban Redevelopment Authority, which owns the 140,000-square-foot Pennsylvania Railroad Fruit Auction & Sales Building, signed five-year leases with the tenants last month, leaving just 6 percent of the building unoccupied.
“There’s been a change in thinking away from creating a market house under a single roof to a concept in which the entire Strip is viewed as the city’s market district,” said Rob Stephany, URA deputy executive director. “Ultimately, we want to create a really vibrant retail environment along Smallman and the sides streets that connect with Penn Avenue.
“We see the (produce) terminal building as just one part of the market district.”
Community development group Neighbors in the Strip proposed using $8 million in state and local grants to transform the terminal into a marketplace.The URA is open to leasing the available 8,000 square feet in the building — or space on the outside platform and along Smallman — to vendors, Stephany said. The URA will work with Neighbors in the Strip to devise plans to advance the market district concept, he said.
Becky Rodgers, executive director of Neighbors in the Strip, said advancing the market district concept will require her organization to focus on projects such as:
• Attracting more residential development
• Branding and marketing the neighborhood as Pittsburgh’s market district
• Helping property owners develop under-utilized second and third floors
• Making Smallman Street safer for pedestrians
• Erecting signs listing the type and location of Strip businesses
• Helping property owners develop “mini-market houses” in buildings that might be too large for a single business.
“Our goal is to promote economic development while preserving the historic character of the Strip,” Rodgers said. “The traditional grittiness is something that stakeholders have said they want preserved.”
Brad Kokowski, who’s owned Superior Produce in the terminal building for 20 years, likes the idea of attracting shoppers from the busy Penn Avenue corridor.
“Right now, there aren’t a lot of reasons for people to come over here,” said Kokowski, whose business is a combination of wholesale and retail. “If it’s done right, this terminal and the area around it could make a great market. I just don’t want to see businesses like mine, which have been here for a long time, pushed out for it to happen.”
Sam Patti, who owns La Prima Espresso Co. in the terminal, thinks the Strip could benefit from using the building’s empty space for more retail, wholesale or a combination of the two — as long as its basic character is not changed.
“The space needs to be clean and secure, but it doesn’t need to be anything fancy,” he said. “This is the Strip. People like the gritty atmosphere. If they want glitzy, there’s plenty of other places around for them to shop.”
Tony LaRussa can be reached at tlarussa@tribweb.com or 412-320-7987.
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Stanwix Street closure hurts, businesses say
By Adam Brandolph
TRIBUNE-REVIEW
Tuesday, February 19, 2008The tunnel-boring machine for the North Shore Connector project is more than 50 feet underground, but businesses on the other side of the river at Stanwix Street are feeling the shock waves.
Some business owners say they have lost customers since July, when the road closed to motorists between Fort Duquesne Boulevard and Penn Avenue, Downtown. The street is open to pedestrians.
Howard Kernats, owner of Hair Fashions by Howard, estimated business is down 60 percent. “It’s been tough,” said Kernats, 66, of Robinson. “Everybody on this block is hurting bad.”
Others aren’t so sure.
Bob Zilch, owner of Metro News newsstand, said foot traffic usually slows down this time of year. He might have lost some business, but construction workers who buy cigarettes, soda and lottery tickets have made up the difference, he said.
Merrill Stabile, president of Alco Parking, said his nearby garage at Sixth Street and Penn Avenue still fills daily. “There might be some inconvenience to customers, and we want to see the congestion cleared up as soon as possible, but it’s not hurting us,” Stabile said.
Stanwix Street is serving as a receiving ground for the boring machine, which is digging a tunnel under the Allegheny River from the North Shore as part of the $435 million project of the Port Authority of Allegheny County’s light-rail system.
The machine is moving about 25 feet a day toward Stanwix, where it will turn around and dig a parallel tunnel.
Port Authority planned to plate over Stanwix and reopen the street in December, but delays with securing retaining walls pushed the opening to April 1, spokesman Dave Whipkey said.
Construction is scheduled to be completed in 2011. About 14,300 daily riders are expected to use the connector, Whipkey said.
Port Authority has posted signs to let people know the stores still are open, he said.
“It’s one of those things,” Whipkey said. “(Construction) could be taking place anywhere else, and another set of shops could be taking a hit. We hate the fact they’re losing business.”
More than 30,000 motorists a day are detoured around the construction, Whipkey said.
Kristen Trohat, general manager of Max & Erma’s restaurant, said the closure hasn’t affected the lunch crowd.
“But it’s hurting us at dinner time and on the weekends,” she said.
To help alleviate a 15 percent to 20 percent loss in business since construction began, Trohat said, the restaurant brought back its happy hour and is working on a marketing campaign with nearby parking garages.
Sol Gross, 86, owner of a mixed commercial and residential building in the heart of the closure, said the construction has hurt his ability to lure renters.
Fifteen percent of his apartments are vacant, the same as before construction began, he said.
When finished, the North Shore Connector will help his sales pitch, giving him “an added amenity” to offer prospective tenants, Gross said.
Adam Brandolph can be reached at abrandolph@tribweb.com or 412-320-7936.
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Millions could go to revamp landmark Union Trust Building
By Ron DaParma
TRIBUNE-REVIEW
Tuesday, February 19, 2008An investment group that paid $24.1 million to buy the ornate Union Trust Building plans to spend “several million dollars” more to bring the landmark structure back to life.
The group, led by executives of the Mika Realty Group in Los Angeles, promises to refurbish the nearly empty, block-long structure at 501 Grant St., Downtown, and restock its 595,000-plus square feet of rentable space with new office and retail tenants.
“We really want to bring something wonderful to the city. This is a once-in-a-lifetime location. The building is irreplaceable, so we want to get it right,” said Rick Barreca, CEO of Mika Realty.
“I’d like to see a retail bank come into the ground floor, and I’d like to see a nice restaurant,” said Barreca. “We want to have a mix that everybody in the building will be able to take advantage of, and that people in the surrounding area will be happy to come to.”
Hopes are that Larrimor’s, the upscale clothing retailer that occupies a prominent corner at Grant Street and Fifth Avenue, will continue its long relationship with the building, he said.
Barreca is one of the investors in the group headed Michael Kamen, founder of privately held Mika, and a business associate, Gerson Fox of Los Angeles.They’ve hired the Pittsburgh-area architectural firm of Burt Hill Kosar Rittelmann Associates to design the upgrade.
Plans are to clean the building’s facade and install new exterior lighting, signage and new windows on the ground level retail area that rings the building, topping them with decorative glass awnings. The building would get its first on-site parking with 60 new spaces planned on one of its two sub-basement levels accessible from William Penn Place.
Planned lobby improvements include a new security desk, benches and a new lighting package to brighten space underneath the colorful rotunda. Lighting will highlight ceiling mosaic tiles and stained glass above several building entry points.
“We’re working with a historic consultant on the exterior to be careful not to disturb any of the historic features,” Kosar said.
“We’re also looking at adding new artwork and possibly some displays that could be changed seasonally, Barreca said.
The Pittsburgh History & Landmarks Foundation is happy with Mika’s plans for the building, said Arthur P. Ziegler Jr., president of the South Side preservationist organization. The foundation has offered to work with the developers to help them secure historic tax credits for some of the renovation work, if the group decides to pursue them, he said.
Designed in Flemish Gothic style by noted Pittsburgh architect F.J. Osterling and built in 1916 for industrialist Henry Clay Frick, the building opened in 1917 as the Union Arcade, an upscale, indoor mall with 238 shops and more than 700 office tenants.
In 1922, it came to be owned by Union Trust Co., and after a 1946 merger, by Mellon National Bank and Trust Co., predecessor to Mellon Financial Corp., now Bank of New York Mellon.
Mellon decided to vacate its substantial presence in the building in May 2006 and DeBartolo Property Group LLC, the owner since 1984, stopped aggressive efforts to keep other tenants, leaving it in its present state.
It eventually defaulted on its mortgage, and ownership passed to Philadelphia-based insurance firm Cigna Corp., holder of the loan.
Chances to fill the building’s office space have likely improved thanks to a recent tightening of the Downtown office market. And interest in both the office and retail space has been high, said Jeffrey Ackerman, a commercial real estate broker with CB Richard Ellis/Pittsburgh.
Ackerman represented Cigna in a nationwide marketing effort to find a buyer for the building and brokered the deal with the purchasing group.
Ron DaParma can be reached at rdaparma@tribweb.com or 412-320-7907.
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Stanwix Street closure hurts, businesses say
By Adam Brandolph
TRIBUNE-REVIEW
Tuesday, February 19, 2008The tunnel-boring machine for the North Shore Connector project is more than 50 feet underground, but businesses on the other side of the river at Stanwix Street are feeling the shock waves.
Some business owners say they have lost customers since July, when the road closed to motorists between Fort Duquesne Boulevard and Penn Avenue, Downtown. The street is open to pedestrians.
Howard Kernats, owner of Hair Fashions by Howard, estimated business is down 60 percent. “It’s been tough,” said Kernats, 66, of Robinson. “Everybody on this block is hurting bad.”
Others aren’t so sure.
Bob Zilch, owner of Metro News newsstand, said foot traffic usually slows down this time of year. He might have lost some business, but construction workers who buy cigarettes, soda and lottery tickets have made up the difference, he said.
Merrill Stabile, president of Alco Parking, said his nearby garage at Sixth Street and Penn Avenue still fills daily. “There might be some inconvenience to customers, and we want to see the congestion cleared up as soon as possible, but it’s not hurting us,” Stabile said.
Stanwix Street is serving as a receiving ground for the boring machine, which is digging a tunnel under the Allegheny River from the North Shore as part of the $435 million project of the Port Authority of Allegheny County’s light-rail system.
The machine is moving about 25 feet a day toward Stanwix, where it will turn around and dig a parallel tunnel.
Port Authority planned to plate over Stanwix and reopen the street in December, but delays with securing retaining walls pushed the opening to April 1, spokesman Dave Whipkey said.
Construction is scheduled to be completed in 2011. About 14,300 daily riders are expected to use the connector, Whipkey said.
Port Authority has posted signs to let people know the stores still are open, he said.
“It’s one of those things,” Whipkey said. “(Construction) could be taking place anywhere else, and another set of shops could be taking a hit. We hate the fact they’re losing business.”
More than 30,000 motorists a day are detoured around the construction, Whipkey said.
Kristen Trohat, general manager of Max & Erma’s restaurant, said the closure hasn’t affected the lunch crowd.
“But it’s hurting us at dinner time and on the weekends,” she said.
To help alleviate a 15 percent to 20 percent loss in business since construction began, Trohat said, the restaurant brought back its happy hour and is working on a marketing campaign with nearby parking garages.
Sol Gross, 86, owner of a mixed commercial and residential building in the heart of the closure, said the construction has hurt his ability to lure renters.
Fifteen percent of his apartments are vacant, the same as before construction began, he said.
When finished, the North Shore Connector will help his sales pitch, giving him “an added amenity” to offer prospective tenants, Gross said.
Adam Brandolph can be reached at abrandolph@tribweb.com or 412-320-7936.
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City becomes battleground over what makes good design
Monday, February 18, 2008
By Rich Lord,
Pittsburgh Post-GazetteLast week an intensifying struggle over how development is done in Pittsburgh went to the courts.
Next week, it may go to City Council.
The battlegrounds are a mammoth casino garage, a glass-clad arena and a glowing billboard — examples of progress to Mayor Luke Ravenstahl and Urban Redevelopment Authority Executive Director Pat Ford, and of broken process to a growing chorus in the design community.
To Anne Swager, executive director of the Pittsburgh chapter of the American Institute of Architects, last week’s appeals of the casino and arena plan approvals show “a sentiment that [people] haven’t been heard.” And news of a 1,200-square-foot electronic billboard coming to Downtown reminded her that the “planning process is designed to protect the public good, and when an exception is made to that process, it puts us at risk.”
To Mr. Ford, the challenges reflect an obsession with technicalities that is holding back Pittsburgh.
“We’ve got attorneys driving the vision of the city of Pittsburgh, and we’ve got to take it back,” he said Friday. “We should be focused on leadership, collaboration and process. We should not rely on 3 inches of rules to tell us how to be vibrant.”
Last week the Riverlife Task Force challenged the city planning commission’s decision to allow a 10-story garage behind the two-story casino that’s going up on the North Shore. That appeal goes straight to the state Supreme Court.
Allegheny County Common Pleas Court gets the One Hill Community Benefits Coalition’s challenge to the commission’s approval of the plan for the new Penguins arena, which that group argues was made without proper notification to the public of changes in the parking scheme and without consideration of neighborhood benefits.
City Councilman William Peduto said that tomorrow he’ll call for a council hearing on the LED billboard that was quietly approved in December as an addition to the rising Grant Street Transportation Center at Liberty Avenue and 11th Street.
The city zoning code’s special rules for the Golden Triangle don’t allow billboards except on sites where they existed before the code was passed. The thinking was that people on Mount Washington or in PNC Park should see one of urban America’s great views, rather than a wall of logos and ads.
“The image of the Golden Triangle is an important icon for the region,” said Tom Armstrong, a planning commission member from 1982 through 2005 and chairman for the last 15 of those years. The LED billboard “is totally out of scale with the kind of pedestrian environment we have Downtown.”
Even if the sign fits under one of the code’s exceptions, it would require approval by the Zoning Board of Adjustment, or the planning commission, and, potentially, council. Any Downtown project or alteration costing more than $50,000 — and the billboard would cost many times that — must be approved by the planning commission.
None of that happened, though, when the Pittsburgh Parking Authority asked for the OK for the sign on its new garage and Greyhound Lines station. Instead, zoning administrator Susan Tymoczko and Mr. Ford worked a deal with Lamar Advertising, which will operate the sign.
Lamar will give up six old vinyl signs on nearby sites, totaling 1,400 square feet, in return for the illuminated billboard that will flash a rotation of messages.
“Our thought process is one, we can remove billboards, which Pittsburgh has far too many, I would argue, and No. 2, put up a new billboard which I believe is more visually pleasing,” Mr. Ravenstahl said.
Mr. Ford said he decided he could legally approve the billboard for three reasons. First, state law gives businesses the right to modernize. Second, city code “is silent” on whether one can trade old billboards that don’t conform with new zoning rules for new ones. And third, the zoning administrator “is entitled to [approve] minor amendments to site plans” — and a sign that he says will cost Lamar $7 million is, in his view, a minor change.
Mr. Ravenstahl said he is comfortable with the process that led to its approval.
“My understanding is that we are acting appropriately, and every approval we have made is a legal approval,” he said. “I wouldn’t be standing here saying that I support it if I didn’t believe it was legal.”
Mr. Ford cited as precedent a deal he made with Lamar when he was zoning administrator for Mayor Tom Murphy, in which Lamar removed 36 traditional placards in return for the OK to put up six LED signs.
But his boss at the time, former Planning Director Susan Golomb, said the Murphy-era deal was “not comparable” to the one Mr. Ford has worked out. None of those LED billboards went Downtown, where special rules and sensitivities apply.
A deal to eliminate some billboards in favor of others “might be all right, but you have to go through a process,” Ms. Golomb said. “You can’t just set yourself up that you can approve things without any public input.”
Grant Street “represents our values, and our vision for the entire community,” said Anne-Marie Lubenau, president of the Community Design Center of Pittsburgh. “Is that the first impression that we want to give people of our community — commercial advertising?”
“I like signs,” said Mr. Ford. “It tells us that we’re vibrant, that we’re lively, that we like business.”
A smaller electronic billboard, plus a 197-foot-long LED message board, was proposed for the transportation center but rejected by city planners in 2004. The city’s Design Review Committee wrote that the sign was “unacceptable” and “does not contribute positively to the urban landscape.”
Mr. Peduto said he wants Mr. Ford, Mr. Ravenstahl, Ms. Tymoczko and other officials to “come before council to explain how this could happen. … It is obvious that three different public processes were blatantly ignored in order to ram this through.”
His interpretation of last week’s events: “The public process has been eliminated in lieu of developers’ wishes.”
That sentiment is mirrored in the appeals of planning commission approvals.
The Riverlife Task Force argued that the commission ignored rules limiting the size of “accessory structures,” allowing a design in which the casino is dwarfed by a garage that serves it.
One Hill and its allies wrote in their appeal that changes in the arena plan were made at the last minute, not allowing for informed public comment, and that commission member Todd Reidbord left a key meeting to attend a Pitt Panthers basketball game — before returning to vote “yes.”
One Hill’s central concern, according to Michael Healey, one of the attorney’s on the case, is “who controls the development decisions, and who benefits from them?” Citizens have a right to expect that government makes decisions based on “what benefits the health and safety of the residents,” he said.
Ms. Lubenau pointed to SouthSide Works as an example of a project in which neighborhood groups, professionals, nonprofit organizations, the city and a developer worked together to plan something great. A master plan for the post-casino North Shore could have used the same model.
Mr. Ford said SouthSide Works was different from the casino, because lots of city money was involved, giving the city more leverage. Casino developer Don Barden isn’t getting public money, yet agreed to limit smoking, include environmental features and put metal screening on the garage.
“People are just using the judicial process to question the outcome that they do not like,” Mr. Ford said. “We happen to like it.”
The development process is likely to change even more. The URA, which now reaches into the planning process more than ever, is considering “significant organizational changes proposed by Pat Ford to further his vision,” according to an e-mail by its Deputy Director to Councilman Patrick Dowd, who wrote probing the authority’s budget status.
Ms. Lubenau said she just wants to be sure development is handled evenhandedly, according to rules that are clear to all.
“The planning process is a legal process. There’s a structure to that process that includes public participation,” she said. “We should be concerned when that process is inconsistent.”
Rich Lord can be reached at rlord@post-gazette.com or 412-263-1542.
First published on February 18, 2008 at 12:00 am -
Union Trust sale a done deal
By Ron DaParma
TRIBUNE-REVIEW
Thursday, February 7, 2008The sale of the historic Union Trust Building, Downtown, was completed Wednesday to principals of Mika Realty Group of Los Angeles.
Purchase price for the ornate, 11-story building that covers a full block of Grant Street, was $24.1 million, according to documents filed with the Allegheny County Recorder of Deeds office.
The purchase was expected to be completed last week. It was delayed because of the complicated nature of the transaction, said Jeffery Ackerman, commercial real estate broker with CB Richard Ellis/Pittsburgh, who negotiated the deal.
The new owners intend to restore the grandeur of the building that was designed in Flemish Gothic style by noted Pittsburgh architect F.J. Osterling and built in 1916 for industrialist Henry Clay Frick. The buyers were not available for comment yesterday.
The group, which includes Michael Kamen, founder of privately held Mika, and a business associate, Gerson Fox, also of Los Angeles, plans to continue using the structure as an office building and to attract a mix of upscale retail tenants to the first level.
The sale price was about $6 million below its $30.75 million market value, including land, as listed in public records. But local real estate experts said it was not a bargain-basement deal, noting that the building is nearly empty with the exception of a few retail tenants on the first floor.
“It’s a beautiful building with a lot of character,” said Jim Geiger, senior vice president with Grant Street Associates-Cushman & Wakefield, a Downtown commercial real estate firm. “It has a lot of things going for it, but it will be a challenge to fill the office space in light of today’s office market.”
Seller of the building at 501 Grant St. was Teal Rock 501 Grant Street LP, a unit of Cigna Corp. of Philadelphia.
Cigna has controlled the property since 2006, when it assumed ownership from long-time owner, Florida-based DeBartolo Property Group LLC, which defaulted on a mortgage held by Cigna.
The building ran into trouble after Mellon Financial Corp., its major tenant, relocated employees to other buildings Downtown in May 2006, and most other tenants followed suit due to uncertainties with their leases.
For the buyer, the purchase price, which works out to about $40.50 per square foot based on the 595,000-square-feet of leasable space in the building, is lower than it would cost to try to duplicate such a grand structure in the city, said Ned Doran, of GVA Oxford, the commercial leasing arm of Oxford Development Co.
Questions to be determined are how much they will spend to upgrade the building and their ability to attract tenants, Doran said.
Ackerman has said a number of large office users and retail prospects already have looked at the building.
The purchase was welcomed by Tom Michael, who owns upscale Larrimor’s clothing store in the building, the largest remaining retail tenant. Michael said he had talked to Michael Kamen of Mika recently.
“We are optimistic about moving forward and filling the building with quality tenants,” said Michael. “They have a large plan in the works for the building.”
Ron DaParma can be reached at rdaparma@tribweb.com or 412-320-7907
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Sale of Union Trust Building completed for $24.1 million
By Sam Spatter
TRIBUNE-REVIEW
Wednesday, February 6, 2008The historic Union Trust Building in Downtown Pittsburgh has been sold.
Mika Realty Group of Los Angeles completed the previously announced purchase of the 11-story building from Teal Rock 501 Grant Street LP, a unit of Cigna Corp. of Philadelphia, on Tuesday for $24.1 million.The purchase, through Mika’s Five 501 Grant St. Partners LLC, was recorded today at the Allegheny County Recorder of Deeds offfice.
The new owner will continue to use the building for offices, plus first floor retail, said Jeffrey Ackerman, commercial real estate broker with CB Richard Ellis/Pittsburgh, who negotiated the sale.
Efforts will be made by Ackerman and Jeremy Kronman, also of CB Richard Ellis/Pittsburgh, to locate tenants for the 800,000-square-foot building which is nearly empty, except for several retail tenants on the ground level.
Previously known as Two Mellon Bank Center, the building was designed in Flemish Gothic style by noted Pittsburgh architect F. J. Osterling and built in 1916 for industrialist Henry Clay Frick.
Sam Spatter can be reached at sspatter@tribweb.com or 412-320-7843.
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Restaurant, grocer signed for Cork Factory retail space
Wednesday, January 30, 2008
By Mark Belko,
Pittsburgh Post-GazetteThe owner of the Clark Bar and Grill on the North Side and Caffe Amante, Downtown, plans to open a restaurant and cigar and wine bar as part of the Cork Factory development in the Strip District.
The restaurant is one of two businesses planning to occupy the retail space located directly across the street from the Cork Factory, a 297-unit apartment complex at Railroad and 23rd streets that opened in May.
A specialty grocery store also is in the works. It will occupy nearly half of the 45,000 square feet of retail space available in the 3.5-acre Cork Factory development.
Both the restaurant and the grocer have executed leases and are expected to open for business this spring, according to a news release issued yesterday by Cork Factory developer McCaffery Interests.
“This is a catalyst project that I believe is going to create great change, not only for the Strip but for Downtown Pittsburgh,” said Katie Pliscott, leasing director of McCaffery.
The restaurant will be operated by Angelo Lamatrice and his son, David. The Lamatrices currently own and operate the Clark Bar and Grill on the North Side near the stadiums and Caffe Amante in Fifth Avenue Place, Downtown.
Angelo Lamatrice did not want to talk about the Cork Factory venture yesterday, saying plans were still being finalized.
“It’s early,” he said.
But according to the developer, the restaurant will occupy about 10,000 square feet of space and will feature a “sophisticated” wine and cigar bar. There also will be VIP rooms, Ms. Pliscott said.
The operator of the specialty grocery store has not been identified. Ms. Pliscott would give few details about the store, but said it would be operated by a Pittsburgh businessman.
With the plans for the restaurant and grocer, only about 11,000 square feet of retail space remains in the complex.
Since opening last year, the Cork Factory has rented 87 percent of its units, which range from studio apartments to three-bedroom lofts. Rents run from $1,200 a month to $3,900 a month.
Besides the retail development within the complex, there are plans to develop a full-service marina on the Allegheny riverfront.
Mark Belko can be reached at mbelko@post-gazette.com or 412-263-1262.
First published on January 30, 2008 at 12:00 am