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Property sales hailed as Downtown’s rebirth Developers say they are ready to begin long-awaited revitalization

Pittsburgh Post GazetteBy Rich Lord,
Pittsburgh Post-Gazette
Friday, December 15, 2006

With agreements to sell two swaths of Downtown to developers yesterday, the city started the ball rolling on stores, 50 moderately priced apartments and a series of groundbreakings and ribbon cuttings in the center of the downtrodden shopping district.

The sales are the first to result from the latest effort, begun by the late Mayor Bob O’Connor, to revamp the dowdy corridor.

“There have been so many plans through the years about what could happen here, what should happen here,” noted Urban Redevelopment Authority board Chairman Yarone Zober, who is chief of staff to Mayor Luke Ravenstahl. Now, thanks to several developers, he said, “Downtown is really on the move.”

An affiliate of Washington County-based Millcraft Industries will buy the former G.C. Murphy building and adjacent structures for $2.5 million. The Pittsburgh History & Landmarks Foundation will buy three side-by-side buildings on Market Street and Fifth Avenue for $257,000.

Illustrating the challenges of building Downtown, Millcraft gave up its exclusive right to develop three properties at 430 to 438 Wood Street, and announced it was looking around for new partners to help it build a 200-apartment building next to Market Square and south of Forbes Avenue.

Millcraft Chief Financial Officer Brian Walker said the firm has a full plate, and would welcome any URA effort to find another developer who could move quickly on the Wood Street properties, which would have been a small part of the company’s overall plans.

He said getting redevelopment of all of Downtown’s under-utilized properties under way at the same time would benefit everybody.

“Like any development project, and any revitalization effort, it’s going to take time, and it’s going to take a lot of unique ideas and thoughts,” said Mr. Ravenstahl.

On Monday, Millcraft will start constructing the store and office spaces in its Piatt Place, in the former Lazarus store on Sixth Avenue. Millcraft has lined up tenants for the 50,000 square feet of stores, and the first to open will be Capital Grill in July. The sale of condominiums in the building is going well, Mr. Walker said.

Millcraft wants the Trisanti European Market grocery store to open by the end of next year, but it has not decided whether it will be in Piatt Place or the former Murphy’s building.

The Murphy’s building “has been targeted for well over a decade now to be revitalized,” the mayor noted.

Now dubbed Market Square Place and the Market Square Lofts, the groundbreaking, such as it is, may come as soon as April. No ground will actually break, because Millcraft plans to keep the exteriors and the floors of the seven contiguous buildings intact, even while working in 65,000 square feet of stores, 42 apartments and 42 basement parking spaces.

Construction will take a year, and it won’t be easy, because the floors of the buildings don’t line up. The firm is arranging the apartments so renters will not have to climb stairs to get around their units. But the uneven floors contribute to the anticipated $32 million cost, and the need for around $6 million in state redevelopment funding, plus a yet-undetermined value of tax credits.

The state financing should help Millcraft keep the rents relatively low, by Downtown standards. The apartments, ranging in size from 700 to 2,000 square feet, will have rents ranging from $750 to $1,400, said Lucas Piatt, Millcraft vice president of real estate.

To cut costs, the firm had to abandon its intention to add environmentally friendly aspects to the design, he said. It wants to use “green building” standards on planned new construction Downtown.

That would include its South of Forbes apartment building, which the firm hopes to start building in late 2008.

Pittsburgh History & Landmarks plans to start cleaning out its new Market Street properties in January, take 12 months to renovate them, and get tenants into eight apartments in mid-2008. It will spend around $2.5 million, said Arthur P. Ziegler Jr., the foundation’s president.

“We are striving to make it a green building, a restored building,” he said.

As for the Wood Street property Millcraft can’t handle now, and the few other unclaimed Downtown spaces, they should go quickly, Mr. Piatt said.

“It’s really a snowball, and it’s going to keep going.”

(Rich Lord can be reached at or 412-263-1542. )
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