Urban Retail to Kravco: ‘Good luck’ on Downtown project

CEO of Chicago firm shot down as Fifth-Forbes developer says counterpart will find it tough going

By Dan Fitzpatrick,
Post-Gazette Staff Writer
Wednesday, February 19, 2003

Ross Glickman has two words of advice for Kravco Co., the firm selected last week to study and perhaps fix Downtown’s semivacant retailing district.

“Good luck.”

Glickman, chief executive officer of Chicago-based Urban Retail Properties Co., is more than familiar with Kravco’s tricky task. His company, after all, was Pittsburgh Mayor Tom Murphy’s first choice in the late 1990s to redo the same ragged shopping area along Fifth and Forbes avenues.

Urban Retail’s $522 million plan, which collapsed amid concerns from preservationists and lukewarm interest from an anchor tenant, called for the demolition of more than 60 buildings and the addition of 40 new shops and restaurants, along with an 18-screen movie theater and a Nordstrom department store.

Perhaps Urban Retail’s biggest critics were the Downtown property owners afraid the city would take their real estate forcibly, using the power of eminent domain. “I thought we did what had to be done to make this thing viable,” Glickman said. “Unfortunately, there was a contingent of people who didn’t want to go through the eminent domain process. We understood that.”

Two years after leaving Pittsburgh, Glickman also understands why the mayor pulled the plug in December 2000, months before another mayoral election. “It was the right decision for him,” he said.

But Glickman, who once was director of real estate for Pittsburgh-based General Nutrition Centers, also believes the city may have lost its “window” to sign many of the national retailers that expressed an interest in Downtown in the late 1990s. Some of Glickman’s prospective tenants have since gone elsewhere, notably The Waterfront in the Mon Valley and Station Square on the South Side. “The window closed a while ago,” he said.

Glickman still believes that Urban Retail’s controversial development approach — gaining control of a large area of real estate and making changes at once instead of piece by piece — is the right way to fix Downtown. But Glickman is not sure if the city and the Urban Redevelopment Authority, which in recent years spent more than $7 million acquiring 13 area properties, have enough real estate under their control to make that process any easier for Kravco.

Nor is he certain that eminent domain, which the mayor said last week was “not on the table,” will remain off for long.

“Those issues would bubble up immediately,” he said. “I don’t think they have gone away.” Perhaps, with more vacancies along Fifth and Forbes now than a few years ago, property owners might be more open to something “drastic” being done. But, “You are not going to know that until you get into it.”

Starting next month, Kravco will begin work on a four-month study of the area along Fifth and Forbes, with the end result being an “investment plan.” Offices, residential space and new hotel rooms all will be given consideration; and if the city likes what Kravco produces, the two sides would then negotiate a redevelopment agreement.

At a news conference last week, Kravco Chairman Wayne Snyder made it clear that he hopes to avoid the problems that hampered Urban Retail’s last effort, saying he would respect the leases of existing Downtown businesses and weave new businesses into the “urban fabric” of Downtown.

Pittsburgh History & Landmarks Foundation President Arthur Ziegler, a former critic of Urban Retail’s plans, likes what he has heard thus far.

“Kravco has adopted an incremental development approach,” he said, “respecting the historic buildings and adding appropriately designed infill construction, as well as starting with a marketing base of the people who are already shopping in the area. We believe such an approach has the best chance of success. The developer respects the uniqueness and strengths that Pittsburgh has and builds on them.”

But again, Glickman is not sure that will work.

“I don’t think you can do it piecemeal,” he said. “The thing has to be done collectively. National retailers today need to see a collective vision — a design. If you did it piecemeal and that one piece didn’t work, the whole won’t work.”

Glickman, though, insists the city is in “good hands” with Kravco, and that his company is no longer in a position to spend millions on downtown development projects. Since Urban Retail left Pittsburgh, the Chicago company has changed hands — twice.

First, it was sold to Dutch real estate company Rodamco North America NV. Then, last year, it was purchased by a trio of development firms — The Rouse Co., Simon Property Group and Westfield America. It is no longer a development company; it is concerned with only consultant work and property management, overseeing 40 million square feet of real estate for other owners.

But Glickman still likes to keep tabs on Pittsburgh — and the long, tortured effort to redevelop Downtown. “I really believe in Pittsburgh,” he said.

His last visit was two months ago, when he took a walk along Fifth and Forbes. He noticed that more storefronts were empty than there were a few years ago. The area, he said, is “sad” and “pretty bleak.”

“Is the street better off now than it was four years ago?” he said. “I doubt it.”

Dan Fitzpatrick can be reached at dfitzpatrick@post-gazette.com or 412-263-1752.