Category Archive: Downtown Development
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Station Square at 25 – Competition pushes old rail complex to focus on entertainment
By Mark Belko,
Pittsburgh Post-Gazette
Sunday, December 05, 2004These days, Station Square likes to bill itself as “Pittsburgh’s place to play.” Al Ratner won’t settle for anything less. The old railroad complex has long been a popular tourist destination. Now, Ratner, the board co-chairman of Forest City Enterprises, the Cleveland developer that owns the property, wants to make it Pittsburgh’s premier entertainment spot as well.
That’s a measure of just how far it’s come in the 25 years since civic, business and political leaders sipped drinks and strolled the red brick floors at the opening of the Freight House Shops in 1979.
What once was a quirky mix of local shops, retailers and restaurants, including the just-closed nuisance nightclub, Chauncy’s, has become a land of dancing fountains, a tented amphitheater and a host of dining and entertainment venues as the complex tries to stay fresh against competition on the South Side and trendy developments such as the Waterfront.
The stately Grand Concourse restaurant, a converted train station, is still there, as is the Gateway Clipper, the riverboat fleet that remains a favorite for families, senior citizens and school outings. Some of the original shops, such as St. Brendan’s Crossing and Morini, still occupy space in the Freight House. Houlihan’s restaurant, another original, also remains.
But more and more, with an eye seemingly aimed toward casino gambling, Forest City is moving Station Square away from its retail roots with restaurants anchoring the ends to a full-fledged entertainment and dining complex, unnerving some longtime retailers struggling to keep their businesses afloat.
The transition is evident in brochures: Station Square currently is home to roughly 27 restaurants or entertainment spots and 22 shops or services, compared with 18 eateries or nightclubs and 48 shops or services in the first years after the complex opened.
Old mainstays such as The Limited, Limited Express, Laura Ashley and Casual Corner are gone. Nearly a third of the retail space in the Freight House was taken over by the Bradford School, a two-year career institution which opens next month and which will bring a younger crowd to Station Square,
“You look at places like Hard Rock Cafe, the Funny Bone, Crawford Grill with live entertainment, yeah, it’s definitely taking a different path,” said city Councilman Alan Hertzberg, whose district includes Station Square. “Even the fountain show that was built there is entertainment right now. It’s definitely taking on a new theme, one I think is being very well-received.”
Not by all. Some fear that Freight House retail may end up going the way of the old rail service that once ran through the complex.
“I see the eventual end of retail here in the next five years,” said Ron Collins, manager of Bradley’s Books, who estimates the store’s business is down 20 percent this year, mainly because of the shifting priorities. “Station Square has really changed the focus around here.”
More expansion to come
The emphasis on entertainment has brought some problems, the most visible of which was this week’s court-ordered permanent closing of Chauncy’s after being termed a nuisance bar. The district attorney’s office cited 80 incidents at the club since July 2003, including fights, drug dealing, assaults and a November 2003 homicide in a parking garage that police said stemmed from a dispute in Chauncy’s. Two club officers also have been accused of dealing drugs from the club.
Chauncy’s was in the Commerce Court section of Station Square not controlled by Forest City, although it expects to have at least some say in what goes into the vacant space. While the club could pack in the crowds, no one seemed to mourn its demise.
“I believe it will be a positive for Station Square,” said Gary Marasco, general manager of the complex’s Hard Rock Cafe.
“At the time the violence started, it did have a significant effect. The media attention raised a lot of eyebrows with our clientele. Families want a safe place to go out and dine. We definitely saw a drop-off in business. I think it hurt the name of Station Square as a place to go.”
You wouldn’t know it by the weekend crowds that pour into the complex, whether for concerts, pre- or post-Steelers game revelry, Light Up Night, or an evening of eating and drinking.
Much of their business is focused on the fruits of a $71 million building campaign Forest City embarked on in 2000, altering not only the face but the sashay of the historic 52-acre riverside complex.
The first phase involved construction of a $25 million, nine-story wing to the existing Sheraton Hotel, adding 104 rooms. Then came the $25 million Bessemer Court project, the centerpiece of the developer’s expansion so far.
It brought the Hard Rock Cafe, Bar Louie, the Red Star Tavern, an expanded Funny Bone comedy club, Joe’s Crab Shack and several other restaurants to the centrally located court, named after an old Bessemer converter that had been taken from a Pittsburgh-area steel mill.
The piece de resistance was construction of a 100-foot-wide fountain that shoots jets of water up to 60 feet and is synchronized to play off colored lights and music, a Vegas-style attraction far removed from the old rail yards.
This spring, Forest City plans to build a public marina on the banks of the Monongahela River that will allow boaters to dock and partake in Station Square offerings. An elevator and 140-foot pedestrian walkway, both of which have been built, will transport boaters from the marina to Bessemer Court.
Ratner envisions water taxis zipping along the rivers, taking visitors from Station Square to the North Shore, South Side and other destinations and back.
With the help of a $5 million state grant, the developer will erect a pedestrian walkway over Carson Street to link the complex with the Port Authority light rail stop and the Monongahela Incline, tying Station Square to another popular tourist spot, Mount Washington.
“We think connecting Station Square to Mount Washington is extremely important,” Ratner said. “It’s wonderful to park at Station Square and take the incline and have dinner. We don’t have another place in the state that has that opportunity.”
Casino dreams
Growing competition is driving the improvements.
Just down Carson Street is the South Side, still a very popular nightspot, and the emerging South Side Works complex, with the Cheesecake Factory, a new movie house and other options. There’s also competition from the Waterfront in Homestead and the Strip, with its nightclubs, bars and restaurants.
“I guess I would tend to think that the local or regional flavor has shifted to the South Side,” said commercial real estate broker Kevin Langholz, of the Downtown firm Langholz-Wilson & Associates. “The culinary experience there is a little more intimate, kind of now, if you will. It will change even more with the South Side Works.”
Beth Edwards, Station Square manager, said the emphasis on entertainment also was an answer to suburban malls.
“I think there’s a lot of retail out in the suburbs. We’ve been very successful in attracting national and international restaurants. We have tourist destinations with the Gateway Clipper, the amphitheater and the Just Ducky tours,” she said.
Whatever the competition, Forest City could end up trumping it all if it wins the state license for a stand-alone slots casino in Pittsburgh.
Forest City has made no secret about wanting to add gambling to the mix. In buying Station Square from the Pittsburgh History & Landmarks Foundation for $25.5 million in 1994, it did so with an eye toward docking a riverboat casino on the banks of the Mon.
Riverboat gambling never became law in Pennsylvania, but slots gambling did, in a vote by the state Legislature last summer, and Station Square is considered a prime site for the casino, in competition with the Penguins, who want to build one near Mellon Arena, and parking czar Merrill Stabile, who wants to put one on the North Shore.
Forest City has been discussing a possible partnership with Harrah’s Entertainment Inc., the Las Vegas casino operator. Harrah’s sold its interest in Station Square to Forest City in 1998, but retained its option to build a casino there through 2007. The state expects to award the Pittsburgh casino license in 2006.
Ratner has been reluctant to comment on the casino issue, noting that the state hasn’t set up the application process.
But Langholz, who believes Station Square can continue to succeed without gambling, has no doubt that the impact would be great.
“Gambling would serve as a tremendous anchor, much as a department store does to a regional mall. It would further the life cycle and enhance the amenities at Station Square,” he said.
City Council President Gene Ricciardi has expressed concerns about gambling at Station Square, fearing it could jam traffic and take patrons from the South Side, his district.
Some Station Square retailers also are wary of gambling, while others are ready to embrace it.
“I’m not thinking that’s really going to help us,” said Carol Wilson, owner of Accentricity, a Freight House jewelry store. “When you look at the Boardwalk [in Atlantic City] a lot of those shops are gone. I’m not sure it’s going to be a big thing for me. I’m hoping I’m wrong.”
“I don’t think it would help this establishment. The money won’t go back into development,” said Collins, of Bradley Books. “I’m rooting for Mario [Lemieux, Penguins owner], because people will benefit from it.”
Marasco sees it as a plus for the Hard Rock.
“Obviously, from a foot traffic standpoint, it’s great for Station Square. We’re very much in favor of having gambling at Station Square,” he said. “I think it would make Station Square the crown jewel of development in Pittsburgh.”
Eileen Manning, of St. Brendan’s Crossing, one of the original Freight House shops, also is supportive. “It can only be helpful to encourage more people to visit here,” she said.
Should Station Square lose out on the casino license, Forest City would consider doing office or residential development on the property, Ratner said.
Lots of businesses and restaurants have come and gone in the 25 years Station Square has existed. The Cheese Cellar, another original, recently closed. Tequila Junction is gone. So is Bobby Rubino’s. Bolan’s Candies shut down, as did B. Dalton Booksellers. The Pittsburgh Sports Garden gave way to Rod Woodson’s All-Star Grille, and then to Philthy McNasty’s. Now a new restaurant, Margarita Mamas, occupies the space next to Hooter’s restaurant.
But while Downtown retail has faltered and many businesses have gone under, Station Square has managed to adapt.
“I think Station Square is still an attractive tourist spot, given the amenities of the river’s edge and with the Liberty Belle and the boats. It’s still a major attraction for people coming into Pittsburgh for the first or second time,” Langholz said.
(Mark Belko can be reached at mbelko@post-gazette.com or 412-263-1262.)
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Birru did his best under tough circumstances, some say
By Dave Copeland
TRIBUNE-REVIEW
Friday, May 28, 2004Whether the high-profile projects he led caused the city’s financial crisis will be debated for years, if not for decades.
But observers of outgoing Urban Redevelopment Authority Executive Director Mulugetta Birru said Thursday that the city’s money woes might have played a role in his decision to leave for a new job with Wayne County Economic Development Corp. in Michigan. Detroit is the county seat.
“This could easily mean fewer deals to do and a lot of retrospection about the Downtown retail situation and, hopefully, some serious self-examination about the low level of commercial occupancy,” said Robert P. Strauss, a professor of economics at Carnegie Mellon University’s H. John Heinz III School of Public Policy.
“In this sort of cutback environment, it’s entirely reasonable to expect somebody with Mulu’s energy level to seek another venue where he can build public-private partnerships,” Strauss said.
Birru, 57, wouldn’t give specific reasons for his departure yesterday, saying only the new post is a better opportunity that nearly doubles his current salary.
Under Pittsburgh Mayor Tom Murphy, Birru and a URA staff of more than 100 carried out one of the city’s most ambitious and controversial urban-renewal programs since Mayor David L. Lawrence’s Renaissance in the years following World War II.
One of Birru’s biggest proposals never came to fruition.
In the late 1990s, the Murphy administration pushed for a $520 million Downtown overhaul called Marketplace at Fifth & Forbes. The effort was turned back by a grassroots coalition of property-rights advocates and historic preservationists and a loose-knit group of young professionals, artists and city residents.
“That disappoints me a lot,” Birru said.
Murphy scrapped the plan in November 2000. Subsequent efforts to redevelop the Downtown retail corridor, dubbed Plan C, have stalled. Two department stores that Birru helped lure with a variety of subsidies also failed. The Downtown Lazarus-Macy’s closed earlier this month, and Lord & Taylor will close next year.
Birru defended the department-store deals, comparing them to the public investments by Westmoreland County in an auto-manufacturing plant that failed in 1988 but was converted into a Sony manufacturing plant in 1992.
“I honestly have no regrets about the Lazarus building or the Lord & Taylor building because now we have discussions with developers on those two buildings,” Birru said.
A co-founder of Ground Zero — an activist group formed in part to oppose the Marketplace plan — said the URA’s successes in housing and in using the Main Street redevelopment model in small, neighborhood business districts would be a good model for future efforts.
“With the director of the URA leaving, and against the backdrop of extremely substantial financial problems for our region, this would be a good time to re-examine the development tools and organizations we have at the city, county and regional levels,” said Ground Zero’s Pat Clark.
Pittsburgh History & Landmarks Foundation President Arthur Ziegler, who also opposed the Marketplace plan, described Birru as “congenial and forthright” in those and other discussions. Ziegler said he did not see Birru as the impetus for many of the Murphy administration’s redevelopment strategies, but as the person who carried them out.
“I always felt he was doing the best he could for the city within very restricted circumstances because I always assumed that the chairman of the authority (executive assistant Tom Cox) set the agenda and goals, rather than Mulu,” Ziegler said. “I feel he was sensitive to historic preservation, but I don’t think he was able to act on behalf of preservation as he might have wished — and certainly not as much as we might have wished.”
Former Allegheny County Executive Jim Roddey echoed Ziegler’s comments, saying Birru had not been given the “right directives.”
“The efforts to put retail Downtown were doomed from the beginning,” Roddey said. “If they had assumed a strategy of putting all our resources into housing instead of retail, if they had found a way to get people living there, the private sector would have taken care of retail on its own.”
Until July 2000, Birru also headed Allegheny County’s economic-development department.
Roddey said yesterday he asked Birru to step down from the $82,800-a-year job because “economic development is too important to the county to have a part-time director.”
Before joining the URA in 1992, Birru, an Ethiopian immigrant, headed the Homewood-Brushton Revitalization Corp. He earned a doctorate in public and international affairs from the University of Pittsburgh in 1991 and has been an adjunct professor at Carnegie Mellon’s Heinz school.
Birru said his greatest legacy is in the “strong” URA staff he put together. He has complained in recent months that some of his best people have left the authority as it has come under increasing scrutiny by state lawmakers, who question its investments and want to sell off its assets.
“People in Pittsburgh are really spoiled,” Birru said. “They think these things happen easily.”
Dave Copeland can be reached at dcopeland@tribweb.com or (412) 320-7922.
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Proposals abound for Fifth and Forbes
Compiled By Patricia Lowry,
Pittsburgh Post-Gazette
Sunday, February 08, 2004The distinct local businesses in the Fifth and Forbes district cannot hang on forever while PNC and the Urban Redevelopment Authority collect and sit on empty properties and the mayor waits for the perfect retail development to fall into his lap. The city’s Downtown deal-making of the past years has done nothing but plunge the city into debt. Downtown’s real estate market values no longer relate to reality, and no one can make an investment knowing that large-scale property owners are letting large swaths of the Fifth and Forbes district fester indefinitely.
Downtown should capitalize on what it does best: entertainment and commerce. Forget about subsidized big-box retail Downtown! Don’t compromise Kaufmann’s success. It is a destination unto itself, and subsidizing its competition is counterproductive.
Downtown will not succeed in the long term as a one-fell-swoop retail development project. For investment in the Fifth/Forbes district to be sustainable, development must be incremental and market-driven (the antithesis of the recent Lord & Taylor and Lazarus fiascoes). Paying outside developers to fix our city will do little to improve the integrity of our Downtown and will further export future income generation.Ideas for helping to promote a sustainable future for Downtown start with the sale of Fifth/Forbes district URA properties. Proceeds generated from the sales should be used to:
Hire a Main Street manager to market the district’s assets and to connect buildings/available rental space to interested tenants/owners.
Revive the Golden Triangle Community Development Corp. and give small business a bigger voice in Downtown development discussions.
Create an immigrant-recruitment and relocation program to repopulate Downtown and enliven specifically the Fifth/Forbes district.
Target investments to make the district’s buildings easier and more profitable to convert into mixed-use or residential buildings (for example, matching grant programs for the installation of elevators, sprinkler systems and a second means of egress), eliminating some roadblocks to building reuse.
Start a business program that helps local entrepreneurs.
Revive the URA Street Face program. Created to promote the sensitive renovation and rehabilitation of historic building facades, this program was just closed indefinitely, presumably due to the city’s fiscal situation. This was the one program that supported individuals wanting to invest in Pittsburgh’s aging building stock.
At this point, you must be a big-time developer to get support or interest from the city for your projects.
Plans for revitalizing areas:
Market Square is the rundown heart of Downtown. The Fifth/Forbes district cannot be improved without substantial investment in its core. What should be a central gathering place lacks in attractiveness, safety and cleanliness. With prominent empty storefronts at opposite corners of Market Square — the PPG and Murphy’s buildings — the public space feels increasingly vacant and rundown.
The Murphy’s building would be perfect for a market place. Downtown employees could use a supermarket with more inventory than a convenience store, where they could pick up dinner on the way home. A deli-style take-out counter would be a welcome addition to the lunch opportunities around Market Square. Surely the college students and residents of Downtown would appreciate being able to walk to get groceries.
At Warner Center, pair up each of the food court vendors with an empty URA property and a business plan. Activate the streets with diverse businesses. Turn Warner Center back into a movie house with more mainstream box-office draws to complement but not compete with the Harris Theater.
Forbes Avenue, full of smaller storefronts, could become the destination for a variety of ethnic restaurants and smaller-scale nightclubs and entertainment, particularly as the Cultural District empties certain tax-paying businesses from Liberty Avenue.
Finally, encourage Downtown living, including more dorms for Point Park and Duquesne students.
Start small, build green
Gary Saulson, Senior Vice President and Director of Corporate Real Estate, The PNC Financial Services Group
As owner of the largest group of properties that could be developed in the Fifth/Forbes corridor and one of the city’s largest employers, PNC has a vested interest and deep commitment to the revitalization of Downtown, which has tremendous benefits for the city and our region overall. Clearly, the “big bang” approach has not worked, so my three main recommendations are:
Think big, start small: Greater emphasis should be placed on Downtown’s residential population to help draw small businesses back into the district. There should be larger residential developments that appeal to a diverse range of residents, from the recent college grad to empty-nesters who are all drawn to the amenities and conveniences that could be offered. This will create the critical mass that a large, national retailer covets, and generate interest in the Lazarus and Lord & Taylor buildings. Now is not the time to get discouraged and overreact.
To complement any incoming “destination”-type retailers, we must pay equal attention to filling the spaces between those stores with the right mix of street-level businesses that will attract shoppers. Any mall developer will tell you the “anchor” stores rely on the smaller stores and vice versa. Go slow to grow big — accept steady, incremental growth and give entrepreneurs a chance to make a difference, along with the time to make it happen. It will take longer, but the benefits will be far more lasting.
Get connected: This city has already proven an ability to succeed with public/private partnerships, such as the Cultural District. Let’s build on the success of this nationally renowned redevelopment and expand its look, feel and vibrancy into central Downtown and extend it to the First Avenue area, where improvements are already being made. We can create “connectivity” so that residents and visitors alike can walk from river to river and appreciate the continuity, cleanliness, safety and vitality of our historic city. Responsible development that includes modern, appropriately priced housing attracts residents and will, in turn, drive demand for a wide variety of retail and service businesses.
Build responsibly: Think “green.” Pittsburgh is a national leader in environmentally responsible construction, with more than 30 registered or certified “green” buildings, including the two largest in the world — the convention center and PNC Firstside Center. We can continue to reinforce our region’s evolution by applying environmental principles to the revitalization of Downtown. A deeper commitment to water and energy efficiency, open “green” space, pollution control and traffic planning all will serve us well. It also will make Pittsburgh more attractive to potential businesses, residents and tourists.
Embrace market economics
Bernie Lynch, former executive director of the Market Square Association
Here’s how to do it:
Repeal the Fifth/Forbes redevelopment plan and “lift the cloud on the title” of these properties, allowing them to be free and clear for resale for what the market will bring. Stop our government from using eminent domain by taking property from one private owner to give to another of its choice.
New development: Ask PNC chairman Jim Rohr to develop PNC’s dozen or so properties on Fifth Avenue.
Force the URA to sell its Downtown properties (including Lazarus), valued collectively as high as $50 million. Sell them in an open, transparent bidding process (banks need not apply). Open the pools and recreation centers this summer with the first proceeds of the property sales, which should use up about $4 million, leaving us $16 million to $46 million to help fix that budget problem we keep talking about.
Disband the URA. Overhaul the whole idea of “authorities” that take our revenue streams for their purposes and leave the city economically dry to operate. No RIDC, no county development agency. Encourage the private sector to do this work. Re-evaluate market-manipulation funds like tax increment financing, the Strategic Investment Fund, the Pittsburgh Development Fund and others. Realize that “big bang” doesn’t work long term.
Embrace entrepreneurs, businesses, mom-and-pop shops, the owner-occupied merchant, the immigrant business owners who can’t work in corporate America but whose drive can’t be stopped.. Embrace the yet-to-be-revealed, next-generation business gurus.
No more handouts. No business privilege tax for anyone. Spread a regional business tax that is palatable to all across five or six counties. Let’s not keep driving everyone out of a core that will collapse if it isn’t supported.
Build on strengths
Young Preservationists Association of Pittsburgh; Dan Holland, founder
The association embraces the message of CMU professor Joel Tarr’s new book, “Devastation and Renewal: An Environmental History of Pittsburgh and Its Region”: Let us not repeat mistakes of the past.
We think Downtown doesn’t need too much tinkering to enhance its strengths, which include architectural diversity, pedestrian-friendly streets, a transit-accessible location and untapped potential for housing.
Creative and flexible taxation and zoning mechanisms combined with existing preservation laws, new state legislation and time-tested preservation techniques can ultimately generate a successful mixed-use residential, office and retail environment for the Fifth/Forbes corridor.
We have three recommendations:
Expand the Downtown historic districts. You can’t have too much of a good thing. Pittsburgh must maintain the historic integrity of our Downtown buildings, including historic interiors. We want to keep our architectural landscape as distinct as possible so that our Downtown is unlike any other urban center in the country. The current historic districts — Penn-Liberty and Market Square — are the most vibrant and economically successful parts of Downtown. We must build upon this success.
Consider a third Downtown historic district along the Fifth/Forbes corridor, to include other notable structures, such as the Park Building and Warner Theater. Nominate Fourth Avenue, between Smithfield and Wood streets, which borders the Market Square district, as a city historic district.
Amend the Historic Preservation Code to create a special historic interiors provision for Downtown. The gutting of the marble interior of Mellon Bank was a travesty that could have been avoided if preservation of historic interiors had been codified into law.
Allow for flexibility. The YPA is not flatly against demolition or alteration of historic structures; some compromises may have to be made. But these are options of last resort Progressive new architecture should be encouraged where appropriate, but not to replace a historic structure.
Create a competitive program that rewards innovative, quality commercial design with incorporated living spaces and sound business plans with low- or no-cost land, plus new/upgraded infrastructure to the site. An Urban Business & Residential Homesteading Program would encourage a mix of housing, retail and office space. The agency would help negotiate the sale of buildings and make the property available to the highest evaluated rehab/development/small business plans within established guidelines and rehab standards.
Encourage banks to adopt a Location Efficient Lending program –innovative underwriting standards by private or public lenders who recognize the significant retention of disposable income to people who are living where they work.
Urge swift passage of the proposed Historic Rehabilitation and Economic Revitalization Tax Credit Act (Pennsylvania Senate Bill 820 and its companion bills, House Bill 951 and 952). The House version passed unanimously in 2003. In short, this legislation provides a 20 percent tax credit on eligible redevelopment costs. The proposed historic tax credit empowers local redevelopment authorities to designate those buildings that are most important to the community and most economically viable for consideration.
Adopt meaningful transit changes to increase Downtown’s accessibility without compromising its historic integrity. This would mean no more surface parking lots. Consider creating a free (or low-fee) shuttle that would service suburban communities to bring people Downtown. Create common-sense ways to navigate the archaic Downtown bus routing systems. A commuter rail system from the north and east should be strongly considered, eliminating the current strain on Route 28 and the Parkway East.
Word by word
Eve Picker, President, no wall productions
It’s like a crossword puzzle. You can’t solve all the words at once. They intersect and need each other. But you know that it is solvable. If you start in one place, with one word, and then another, it gets easier and easier.
The Fifth and Forbes project is no different. We have tried to solve it all at once. We need well-sequenced, small, achievable steps that get us there in the end. And here they are:
The G.C. Murphy Block:Develop the upper floors of as much of the G.C. Murphy block as possible. Forget about the missing pieces. If property owners want to be holdouts, so be it. A lot can be done right now. And I will shamelessly add: Let no wall productions do this project. We’ve been working on it for months now, with the continued support of the URA, and we know how to make it fly.
Market Square: Police Market Square 24 hours a day and clean it up. It must be a joy to visit, not a threat. Chase away loiterers. Encourage others to program more there in the summer. Solicit the help of the Market Square Association and the Pittsburgh Downtown Partnership. Sweep it, clean windows, keep it free of litter, and do it every day.
Market Square District: Pull the charm of Market Square up the street, along Forbes Avenue. Create a Market Square District. The entire block of Forbes from Wood to Market Square would feel as if you have entered a neighborhood. The effect is easy to achieve. On the north side, the G.C. Murphy building will be ready with tenants and a gorgeous facade. The URA has control of a lot of land on the south side of the street — here’s an opportunity to build a smaller-scale housing project; maybe this one can be for sale. There’s enough land for parking here, too.
Build great retail spaces, and now you have three spaces ready for retailers: the G.C. Murphy building, the Lazarus building and the south side of Forbes. Now let’s think about improving the sidewalks and lighting, too.
Fifth Avenue: The toughest block to develop — it’s a great location for a future larger and denser housing and retail project but will need parking, and it is very, very expensive to build. It looks hard now but will become easier as the rest takes off. It’s the hardest word to solve in the crossword puzzle. But we have a powerful ally there: PNC Bank.
Retail: Keep looking for a retail partner to implement the retail plan. Make it as enticing as possible. We have a significant site assembled. There’s something to be said for staying with Downtown Works — they have such a thorough understanding of the city by now; we may lose too much time starting over. It will set us back another year.
A market house in Market Square
Arthur Ziegler, President, Pittsburgh History & Landmarks Foundation
Take any available funds, publicly held land and suitable buildings and make them available for housing.
Support a great market house in Market Square. If Market Square must remain open space, use the G.C. Murphy building. A stunning new building would symbolize a positive Downtown renewal and answer the No. 1 question of potential residents: Where can I buy groceries?
Do not limit the housing to the Fifth and Forbes area, but encourage it, preferably with its own parking, everywhere Downtown, especially on the riverfronts.
Adopt the excellent plan prepared by Stan Ekstut that Landmarks submitted three years ago as a guide. [It would have cost about the same as the mayor’s plan, but saved more historic buildings and added housing to the mix.]
Blend the bold with the old
Arthur Lubetz Associates Architects, Oakland
The Fifth/Forbes corridor is the core of the Golden Triangle, and as such it should be the core for the city and the region. This Pittsburgh Core should both underscore and amplify the dynamic and strongly dense urban quality of the Triangle. Moreover, the Pittsburgh Core, like the core of the Earth itself, should be a vital, vibrant place. How can we accomplish this?
Restore and re-use existing buildings almost exclusively for housing — dense, impacted housing that attracts a variety of people and income levels. A good deal of this housing should also have access to adjacent parking. In restoring the existing buildings, render them lively and arresting, from brilliant new paint to exciting textures, aromas and materials.
On the cutting edge: or “in-fill” buildings to be erected on empty lots, chose leading-edge, 21st-century architects, commissioning them to design striking, visionary, exciting places that are simultaneously seen and experienced.
In this way, the Pittsburgh Core could be transformed into one of the most thrilling urban settings in the nation, a place that attracts people with a series of dramatic episodes. The end result would be a memorable experience for the participants — achieved by engaging all the senses, stimulating the body, evoking powerful responses. This total experience of colors, sights, signs, sounds and materials would render the Pittsburgh Core a unique place.
A place to go, a place to be. We can distinguish this city with an urban center where visitors feel the great density of a city while gazing past the rivers and to the green hills beyond. What other city can say that?
Back off, Mr. Mayor
Pat Clark, founding member, GroundZero Action Network
Get out of the business of Downtown shopping center development. Until the city steps away from this strategy, the depressed real estate and retail business environment Downtown will continue to degrade. Redevelopment will never occur in an uncertain and speculative environment, an artificial economy where the city and the URA continue to buy up property for the sake of a misguided vision that is not working. Free-market forces can and will be able to begin the kind of incremental redevelopment that will prove to be lasting and effective, but not until the city restores some stability to the district.
Don’t try to do it all. Leadership doesn’t mean running the whole show; it means partnering and empowering others toward shared goals. Encourage, support and embrace a more diverse strategy of housing and business development Downtown, letting retail take its logical, more secondary role. Retail will naturally follow population and business. Funds and support of retail are better directed toward our neighborhood business districts.
Young entrepreneurs should lead the way. There’s a lot of talk in this town about attracting and retaining young people. There’s a simple solution to turning that talk into results: Support their ideas, empower them and fund them. Create a development fund, managed by young people, to support creative young entrepreneurs in developing businesses in the Fifth/Forbes district. A few key businesses founded by young entrepreneurs were instrumental in helping to turn around South Street in Philadelphia and Adams Morgan in Washington, D.C., during the 1980s, downtown Bakersfield, Calif., in the 1990s, as well as our own Carson Street. Perhaps PNC Bank could help fund this type of initiative and, in the process, transform all those empty retail properties PNC owns along Fifth Avenue that have sat vacant for years.
Stop focusing on building $500,000 luxury condos Downtown. The best target market to repopulate Downtown quickly is young people, homesteaders who aren’t bothered by vacant night-time streets but would actually be attracted to a bohemian-style district — if only there were affordable housing in the upper floors of Downtown properties!
Developing this kind of housing will take subsidies, but I’d wager that the luxury condos would, too, and on a much larger scale. The difference is that young people would actually be inclined to live down there right now if there were housing, even without an upscale grocery store or a Crate & Barrel.
Middle-class Pittsburgh is the solution, not the problem. Five years ago, a big part of the reason that we had a lively retail environment Downtown was that its stores served two important customer bases: Downtown workers as well as the working- and middle-class shoppers who relied on public transit. The Nordstrom/Lord & Taylor retail mirage aimed to upscale the district, shooting for attracting the affluent shopper at the direct expense of the more value-minded traditional shopper. Now the empty storefronts serve neither, but chances of redeveloping the district will most logically succeed if based on the customers who have long supported the district.
Sell everything immediately
Terry A. Necciai, former Main Street manager in Charleroi and Somerset, presented a Main Street plan for Fifth/Forbes to City Council in April 2000. He is currently a project architect with John Milner Associates, Alexandria, Va.
Divest the city its financial interests in Fifth/Forbes corridor commercial properties. Government involvement in property ownership and development is a disincentive to businesses. The Fifth and Forbes area is an excellent example — as soon as the city decided to give up on the business people already in place and acquire real estate and seek and financially support outside investors, local business owners began to posture themselves either to sell to the city or go out of business.
From the sale of buildings, set aside some of the proceeds to establish a new “public-private partnership” office aimed directly at helping existing business and property owners to “grow” their businesses and improve their buildings and their marketing strategies. Focus a large percentage of the marketing resources and energy available on creating visible events targeted at making the office workers and various individuals who commute to Downtown feel like the place is “people friendly” and fun.
Create an aggressive, positive-minded program that works with existing property owners. This program should be only on a “technical assistance” basis. The technical assistance should include highly specialized, highly qualified and highly motivated staff people who know how to work with property owners, large and small, and who know how to deliver good and useful advice about marketing, aesthetics, advertising, and so on. Such a program can be budgeted (and staffed) at about $200,000 a year or less.
Undertake many small- and modest-scaled projects rather than concentrate on “big fix” ideas. Revitalization is almost the complete, categorical opposite of “redevelopment.” To revitalize means to make something “vital.” Vitality comes with diversity and not with top-down “site control.”
Treat historic buildings as assets and gradually upgrade them. That includes all the old quirky stuff found in the district, Any additional funds the city has available should go toward carefully crafted matching grant programs — the city should give no money to private businesses unless matched by the business owner or property owner who is benefiting from the program.
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A Fifth/Forbes TimelineSeptember 1996 — Demolition begins on nine buildings that will be replaced by a Lazarus department store and underground garage.
October 1998 — The May Co. announces it will buy the Mellon Bank headquarters building for $9 million and spend another $27 million converting it to a Lord & Taylor store. Of the $36 million total, the Urban Redevelopment Authority will provide $11.75 million in a “soft loan.” Repayment won’t be triggered until the store generates sales of $259 per square foot.
November 1998 — $78 million Lazarus opens with $50 million in public subsidies, including $18 million in loans from the Pittsburgh Development Fund, $15 million in tax increment financing and $14 million for the 520-space parking garage.
August 1999 — Mellon Bank’s historic marble interior is demolished.
October 1999 — Mayor Murphy announces a $480.5 million plan by Chicago developer Urban Retail Properties to demolish 62 buildings and replace them with 40 new shops, restaurants, an 18-screen movie theater and Nordstrom store. The plan includes $53.5 million in public funds. The city would acquire 64 buildings, by eminent domain if necessary, and sell the land to Urban Retail.
November 1999 — Pittsburgh History & Landmarks Foundation and Preservation Pittsburgh propose a redevelopment plan by New York architect Stan Eckstut that would cost about the same as the mayor’s plan but save more buildings and add housing to the mix.
April 2000 — The newly formed Golden Triangle Community Development Corp. presents its plan to City Council, based on the National Trust for Historic Preservation’s incremental Main Street approach.
November 2000 — Lord & Taylor opens. With Nordstrom expressing only lukewarm interest in the Urban Retail project and property owners threatening lawsuits, Murphy drops the Urban Retail plan.
December 2000 — Murphy forms Plan C Task Force, a coalition of city officials, building and business owners and preservationists.
March 2002 — Murphy releases details of Plan C: $363 million for a new hotel, office building, indoor public market, two retail buildings and two residential developments.
March 2003 — In a speech at the Rivers Club, Murphy reveals portions of a plan by Kravco. Co., in which the block containing the old G.C. Murphy store would stay intact; parking would be built underneath a Fifth Avenue block controlled by PNC Financial Services Group; and housing would be built along a stretch of Forbes anchored by Market Square and Wood Street. By summer, Murphy says, Kravco will produce a more detailed plan. By early fall, demolition or renovation work could start on the first buildings.
July 2003 — Lord & Taylor announces it will close its Downtown store, which could remain open until its lease expires at the end of 2005.
January 2004 — Kravco drops the Pittsburgh project after merging with Simon Properties, a mall developer. Lazarus announces it will close its Downtown store in May.
— Patricia Lowry
(Post-Gazette architecture critic Patricia Lowry can be reached at plowry@post-gazette.com or 412-263-1590.)
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No Surprise: Landmark asset destroyed for faulty vision
No Surprise: Landmark asset destroyed for faulty vision
August 7th, 2003
Grand Marble Columns Lobby View DESTROYED ABANDONED Lord & Taylor has announced that it will close the store that it built at enormous public cost in the once grand main banking room of Mellon Bank.
Landmarks had opposed the destruction of this exceptional room with its sixteen marble columns, the marble floor and counters, the grand chandeliers, and the bronze ornaments.
We felt that the space was a tremendous magnet to attract people to the Fifth/Forbes area, and it should be given a use that enhanced it.
Instead about $27 million dollars of public money was used for loans and grants to the May Company and its subsidiaries Kaufmann’s and Lord & Taylor and the asset was destroyed.
Across the country, department stores are vacating, dying, or at the best, like Kaufmann’s downtown, shrinking.
They have been described by retail developers as “dinosaurs.”
Landmarks advocated putting the public dollars that were invested in Lazarus, and Lord & Taylor ($70 to $90 million?) into loft housing in the historic buildings together with a considerable amount of new housing coupled with a great new glass Market House at Market Square. Bring in the people and the retail will follow on its own is our belief.
The Cultural District also could serve as an anchor and we proposed better linkage at Liberty Avenue and Market Square to induce people going to the theatres to come into the Fifth/Forbes area.
Lazarus and Lord & Taylor have not brought the promised results of independent retailers springing up voluntarily all around them. In fact, there is a far greater degree of vacancy around Lazarus today than there was before it was built when vacancy was zero.
We believe that the current Fifth/Forbes developer Kravco is on the right track and will release a plan that organically builds the revitalization of the area in a way the speaks to our local market and that will therefore work. We believe the firm will not artificially inflate dinosaurs, but will engage with the future rather than with paleontology.
The tragedy is that the great banking room can never be regained, and in addition the taxpayer is now holding the bill for its destruction.
Copyright © 1997-2007 Pittsburgh History & Landmarks Foundation, 100 West Statio
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How about a store less ritzy Downtown?
y Mike Seate
TRIBUNE-REVIEW
Monday, August 4, 2003You can’t help feeling sorry for our city over the imminent closing of Downtown’s 3-year-old Lord & Taylor department store. Sure, the pundits with their “told-you-so’s” are right: It was silly to throw taxpayer money at the store in the belief that downtown Pittsburgh could support four upscale department stores.
As a shopping hub, Downtown peaked when steel was the undisputed king.The Murphy administration and the city Urban Redevelopment Authority — which gave an $11.75 million loan to May Department Stores Co., Lord & Taylor’s St. Louis-based parent company — had to at least suspect we were already pretty well covered in the $90 umbrella department by Kaufmann’s and Saks Fifth Avenue. Then came Lord & Taylor and, with a loan of its own, a Lazarus followed.
Today, the city is in a mad scramble to fill the soon-to-be-vacant store with another retailer better suited to Fox Chapel or Sewickley than the central business district of an ailing mid-sized city like our own. It’s time to face reality.
Downtown Pittsburgh is like hundreds of other middle-income cities where discount retailers — Wal-Mart, Kmart, maybe a Target — serve poorer, urban consumers while well-to-do shoppers patronize upscale shops in the suburbs.
Don’t lump me in with the urban-bashers who are laughing in their suburban malls over this fiasco. I wanted to see Lord & Taylor help turn Downtown’s grimy Fifth Avenue business corridor around. As someone who grew up shopping in the Downtown, I’ve had a hard time watching the area’s decline over the past 30 years.
I’m sure Mayor Murphy’s team and the URA must have had a vision of returning Downtown to its former glory. You can visit the Carnegie Library in Oakland and see vivid images of a city most of us wouldn’t recognize: streets full of well-dressed white people in furs, suits and fedoras. It more closely resembles a scene from a Fred Astaire movie than the Downtown we know today.
It seems painfully clear to nearly everyone — except city officials — that those shoppers aren’t interested in coming to Downtown in significant numbers. Not when they can shop with free parking, no weather and — let’s face it — fewer poor people and people of color out in the ‘burbs. That doesn’t mean Downtown has to become a sea of plywood-covered windows and “Mookie’s House Of Bling-Bling” jewelry shops.
Me’Shawn Beverly, of the Strip District, was shopping Downtown on Friday. This single mother of three said the Burlington Coat Factory on Smithfield Street is the type of store — reasonably priced, that is — that families like hers need to see more of Downtown.
Beverly, a domestic worker, says she visited Lord & Taylor only once, “to check things out when they first opened.” She was a more frequent visitor than others I spoke with — including some who thought the regal-looking building still housed a bank.
“I still don’t get why there’s no grocery store or a T.J. Maxx down here like up at Waterworks. Get us a grocery store, and I won’t be catching jitneys to the South Side every Saturday,” Beverly said angrily.
I hope she and others will say that loud enough and often enough that someone in city government will listen.
Mike Seate is a staff writer for the Pittsburgh Tribune-Review. He can be reached at (412) 320-7845 or e-mail him at mseate@tribweb.com
This article appeared in the Pittsburgh Tribune Review © Pittsburgh Tribune Review
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Issue One: Lord & Taylor’s departure form Pittsburgh
Sunday, August 03, 2003
Disgraceful Downtown
The decision by May Co. to close the Lord & Taylor store comes as no surprise (“Lord & Taylor Leaving: 3-Year-Old Downtown Store Is Among 32 Retailer Is Unloading,” July 31). Business in Downtown Pittsburgh is hardly booming. What is a surprise is Mayor Tom Murphy’s immediate response that the company committed to a five-year agreement to operate the store and that he will hold it to that agreement.
The mayor promised any business coming into Downtown a revitalized business district. Where is his Fifth and Forbes project that we have heard about for more than five years? If anyone has not honored a commitment, it is certainly our mayor.
Our Downtown shopping district is a disgrace. There is nothing Downtown anymore to attract shoppers. Getting into and out of the city is ridiculous. Parking is expensive and not readily available. The mayor wanted to force many of the small stores out of business (through eminent domain) to make way for his Downtown growth spurt, which has never taken place.
Storefronts on Fifth Avenue are empty and boarded up. Hardly appealing! Before the mayor criticizes May Co., he needs to look at the promises he has failed to honor. There is more to the city of Pittsburgh than the North Side, Mr. Mayor.
PAMELA L. KOVACS
Point BreezeA costly mistake
I am honestly not surprised that Lord & Taylor is leaving Pittsburgh. I am also not surprised that Mayor Tom Murphy and his “powers that be” turned a deaf ear to local historians and preservationists some three years ago and allowed the former Mellon Bank building to be gutted/destroyed for nothing more than a chain department store.The current administration claims to be interested in Pittsburgh’s future, but always at the expense of its past. Let’s not continue to raze what made Pittsburgh what it was and is, in the name of misguided progress.
SCOTT C. KERR
McCandlessNo surprise to me
As a relative newcomer to Pittsburgh, I am not surprised that the Downtown Lord & Taylor store is closing. Pittsburgh is not New York or Chicago; in both cities, a large population of city dwellers as well as city workers sustains downtown shopping. In smaller cities, upscale department stores are typically in the suburbs, where the targeted shoppers live. Moreover, suburban malls offer free parking as well as an enclave of other stores and restaurants catering to those shoppers.Contrary to what might be popular belief, shoppers spending a fair amount of money on clothing do not want to pay an additional $10 to $14 for parking. In addition, on a given shopping trip, they want to choose from a variety of stores and, finally, have lunch or a snack at a nice cafe.
For Pittsburgh to attract upscale shoppers, it must offer: 1) free or very inexpensive parking, not just after 4 p.m. at Christmas, but all the time; 2) a large group of upscale stores that constitute a shopping destination; 3) nice cafes and restaurants offering light meals; and 4) pleasant surroundings — an area that appears to be falling apart does not encourage such shopping.
Whether Pittsburgh can offer these elements Downtown is anyone’s guess. My suggestion to the mayor is, rather than continuing to hope for what will not happen and continuing to lose stores, consider changing the focus to an area such as Shadyside, where upscale shoppers live and shop and where there is potential for more parking space.
ELLYN S. ROTH
Schenley FarmsCity leaders don’t listen
I am a former Pittsburgh resident living in Connecticut, and I read the Post-Gazette online. Regarding the story about Lord & Taylor leaving the city, I’m curious as to why the mayor doesn’t seem to understand why the retailer is leaving.The residents of the city and surrounding suburbs have said for years that if the parking situation Downtown doesn’t improve, Downtown will never thrive. There are too few parking spaces, and the people who are in charge of those few parking spaces grossly overcharge for them.
Why would I drive into the city, battle the annual Pittsburgh road construction/detour system and pay an exorbitant amount to park my car to shop?
The city fathers don’t get it, have never gotten it and, by this time, probably never will get it. Nor do they listen to the people who would be ultimately supporting the Downtown stores, who also have said this for years.
It makes me scratch my head in wonder to see them scratching their heads in wonder.
DEB McLAREN
Mystic, ConnJoe Grata can be reached at jgrata@post-gazette.com or 412-263-1985.
This article appeared in the Pittsburgh Post Gazette. © Pittsburgh Post Gazette
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Lord & Taylor: Sophistry’s ‘rewards’
Sunday, August 3, 2003
Ah, the “fruits” of government attempting to command the marketplace.
The woefully underperforming, heavily taxpayer-subsidized Lord & Taylor department store in downtown Pittsburgh will be “sold” or closed. It’s part of parent May Department Stores’ restructuring that will shed dozens of outlets in 15 states.
As with its more heavily taxpayer-subsidized Federated Department Stores’ kin — Lazarus, a few blocks away — Lord & Taylor, which opened just three Novembers ago, is a dud. Customers have offered little assistance in the bottom-line department.
Sales last year were nearly $26 million below the threshold required for May to pay back the nearly $12 million public subsidy. A handout was the deciding factor in opening Lord & Taylor, as it was with the more than 60 percent taxpayer-underwritten Lazarus store. The administration of Mayor Tom Murphy attempted to artificially create a market where, as sales have proven, none existed.
Contractually, Lazarus can walk away from its store with little or no liability as early as this fall. Lord & Taylor, if it doesn’t repay the loan by buying out its contract, could do the same in 2005. No problem, Murphyites contend, we’ll simply find new tenants. Only to fail again, as the Law of Command Economics dictates.
This isn’t “economic development.” But it is delusive sophism, the primary instrument by which the few have managed to plunder the many by persuading the victims that they are being robbed for their own benefit.
This despicable behavior is Tom Murphy’s real legacy. And Pittsburgh’s curse.
This article appeared in the Pittsburgh Tribune Review © Pittsburgh Tribune Review
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Store fate is raising questions
By Michael Yeomans
TRIBUNE-REVIEW
Saturday, August 2, 2003Questions linger in the wake of May Department Stores Co. decision to sell or close its Downtown Lord & Taylor store. Among them:
Who will buy the building? And, would the city’s Urban Redevelopment Authority approve another so-called “soft loan” in the future in order to lure another retailer into the space?
In the case of the building, speculation abounds, but no clear favorite has emerged. Some experts say a relocation of the Downtown Saks Fifth Avenue across Smithfield Street to the larger Lord & Taylor space makes sense. Others have said the city could take another crack at luring two other upscale retailers — Nordstrom and Neiman Marcus.
May Co. spokeswoman Laura Bryant said Friday a meeting has been arranged between the company and city officials to begin a dialogue over what will become of the building, a landmark structure. In the meantime, it is open for business as usual.
On the question of financing, it appears the city would be willing to offer some type of incentive package for a new retailer.
Lord & Taylor received an $11.75 million “soft loan” from the URA as an inducement to open a store in the former Mellon Bank headquarters building at Smithfield and Fifth avenues, which it did in November 2000.
Under the agreement, Lord & Taylor would only have to begin paying that loan back once sales reached $35 million, at which point it would have to pay 2 percent of gross sales over that $35 million figure. After five years, or in November 2005, the company could close the store without repaying the loan.
The Lazarus-Macy’s store on Fifth Avenue received a similar incentive in 1998, obtaining an $18 million loan from the Pittsburgh Development Fund in return for an agreement to operate for five years, meaning the store could close at year’s end with the loan not being repaid, since it, too, has not reached its sales trigger, $41.7 million.
“If the mayor’s office wants us to assist in finding a new tenant-owner for the Lord & Taylor building, we would do so,” Jerry Dettore, deputy director of the URA said yesterday, declining to comment on whether the URA’s efforts would include soft loans.
Aaron Stauber, managing director of Rugby Realty, who participated in the redevelopment of the former Gimbel’s department store on Sixth Avenue, said Lord & Taylor has several options.
One possibility is to stay open two more years, if it doesn’t find a buyer before that, then shut the store down, without paying back the loan.
Another is to negotiate a partial payment of the loan with the URA, and shut the store down.
Yet another option is to sell or give the building to the URA as a payoff of the loan and take a write-off on the asset.
The building has 196,000 square feet, including 135,000 square feet of selling space on four floors. It is valued at $27.5 million by the county, roughly the amount of money spent by May Co. to renovate the former bank building after paying Mellon Financial Corp. $9.25 million for the structure in 1999.
Stauber said the most logical result is for Saks Fifth Avenue to relocate from its Oliver Street location to the Lord & Taylor building.
This would fulfill a long rumored desire for Saks to expand its store here in a better location, while not introducing a new competitor to the market for May Co.
Hugh “Herky” Pollock, executive vice president of CB Richard Ellis Pittsburgh, agrees.
“For this to work, the city would have to structure a deal by which it would purchase Saks’ current building,” he said.
“We’re always evaluating our store base and exploring opportunities for expansion where appropriate,” said Saks spokeswoman Julia Bentley.
Margaret “Midge” McCauley of Philadelphia-based Kravco, whose Downtown Works division is assembling a plan for redeveloping the city’s Fifth and Forbes corridor, said her group has not been invited into the talks between May Co. and the city, but she said Kravco stands ready to help.
“We have an excellent relationship with the May Co.,” she said, adding that her group has had talks in the past with Saks, but none recently.
When asked if Kravco would possibly be a buyer of the Lord & Taylor building, McCauley said, “That hasn’t been discussed.”
McCauley said there are several incentive tools Kravco could employ to lure tenants to the Fifth and Forbes area, but she said until lease agreements are negotiated, it’s too soon to discuss specifics.
She said any large retailer considering the Lord & Taylor site would likely request some incentives, but she said they would already have incentive enough in a “beautiful building that has already been (remodeled)” only three years ago.
What could likely be ruled out for the building, Stauber said, is a conversion into offices, which would be difficult and expensive. He said it would likely be cheaper for someone looking for office space to build their own building from the ground up for less money.
He also said it is unlikely it would lease the building, especially to a competitor to Kaufmann’s, which May Co. owns across Smithfield Street.
The thing that astounded Stauber is the abysmal sales record reported by Lord & Taylor, which the URA said was less than $10 million in 2002 — about a quarter of what would have triggered repayment of the URA loan.
Stauber said the Burlington Coat Factory, in the basement of former Gimbel’s building that his firm redeveloped, does more sales than that in a smaller store selling cheaper merchandise.
He said Lord & Taylor likely presented the city credible per-square-foot sales numbers from its existing stores to justify the loan trigger amount. He said if the URA does similar type deals in the future, it needs to be more conservative in setting the trigger figure.
Or even better, he said, instead of an all-or-nothing trigger amount, the URA could adopt a tiered repayment plan that would kick in at lower levels of sales.
Tribune-Review reporter Sam Spatter contributed to this story.
Michael Yeomans can be reached at myeomans@tribweb.com or (412) 320-7908.
This article appeared in the Pittsburgh Tribune Review © Pittsburgh Tribune Review