PITTSBURGH | Development Rundown II

[photoLith]

DSC_0267 by photolitherland, on Flickr
PNC from Mt. Washington a couple hours ago.

[BrianTH]

Pittsburgh had relatively fast-growing rent prices from 2007 to 2012 according to a study of Census data by NerdWallet:

http://www.nerdwallet.com/blog/citie...growing-rents/

If you look at the other larger cities on the list, Pittsburgh remains relatively inexpensive. But presumably it has been making up some ground on other cities not on this list. That's good news for developers, but hopefully they can build enough new units to bring appreciation rates down to no more than average such that Pittsburgh will remain relatively affordable indefinitely.

[BrianTH]

Pittsburgh is way above average among large U.S. cities in terms of people walking to work (near the very top, in fact--#3 behind Boston and DC) and above-average in terms of people biking to work (although SF slips above in the overall walk/bike rankings thanks to more bikers):

http://bikepgh.org/2014/04/16/nation...es-pittsburgh/

Note that there is probably a bit of a "small central city" effect here--there is a big difference in terms of how much of the metro area different central cities occupy, and Pittsburgh is toward the small end, as in fact are SF, DC, and Boston, which probably improves its ranking by this sort of measure. Still, I think there is some core truth here, and something we should try to build on. In fact, note there are some other smaller central cities, like Miami and Long Beach, that are way lower on the list.

I also think we can improve rapidly on that biking percentage and in the future maybe challenge DC for #2 overall, or even go after Boston for #1 overall. As discussed in the report, we have lots of room for improvement in terms of bike infrastructure and other public policy support, and the idea of bike commuting in general is still pretty new here.

Finally, as further discussed in the article, this list also confirms it is pretty much a myth that more northerly U.S. cities are at a climate disadvantage in this area. Lots of northerly cities are higher than lots of southern cities, and in fact the only real impediment seems to be very hot days.

[Found5dollar]

some one was asking the other day about the plans for the lower hill and wonderign how much is set in stone. Today i stumbled across the Sports and Exhibition Authority's page on the development. There is every document you could ever dream of reading from traffic studies to water and sewer studies to archeological studies of the area.

If you wan tot know anything about the project go here:
http://www.pgh-sea.com/LHROverview.htm

[Jonboy1983]

Originally Posted by BrianTH

Excellent news:

http://www.post-gazette.com/local/ci...s/201404170269
http://triblive.com/news/adminpage/5...#axzz2zBwuRGxP

Apparently a "local developer" has offered $9.5M for the AWC building, with the plan being to use the air rights to build up (likely for a hotel), while reserving rent-free space for the AWC to continue operations below.

That is a win all around as far as I am concerned. It would even help out the convention center (if in fact it was used for a hotel).

I agree. This is a huge win. I just hope that it doesn't wind up in foreclosure. Then, everyone loses, which would suck!

I do hope this local developer gets the center. A hotel, especially in that location is what this city needs!

Originally Posted by daviderik

Iron Worker Relaxes on I-Beam at the Top of PNC Plaza

Photo: Pittsburgh Magazine

So that's what Bret Kiesel does in his spare time...

[DBR96A]

Originally Posted by Jonboy1983

I agree. This is a huge win. I just hope that it doesn't wind up in foreclosure. Then, everyone loses, which would suck!

I do hope this local developer gets the center. A hotel, especially in that location is what this city needs!

So that's what Bret Kiesel does in his spare time...

AMERICA'S NEXT TOP MODAL...

[BrianTH]

More on Whiskey Barrel Flats. Sounds pretty cool to me:

http://triblive.com/lifestyles/homeg...#axzz2zNfJrH20

[BrianTH]

Very disappointing comments from Peduto and Fitzgerald on the AWC bids:

http://www.post-gazette.com/local/ci...s/201404190088

I don't mind if they want to negotiate the best possible deal for the program as far as continuing in the building in some form is concerned. But the lenders have a right to insist the bids be evaluated in light of their expected recovery, and meanwhile a for-profit owner providing space to the program on a free or heavily subsidized basis may well be the most sustainable model. So I would hope these public officials would be keeping a more open mind.

[Wave]

Pretty surprised with the position of Peduto & Fitzgerald. This would prevent a large, needed hotel development which, thankfully, preserves the mission of the AWC, creates a significant, amount of long term tax revenue, not to mention the city & county probably have zero legal grounds to stop the sale to the highest bidder though they clearly can exact tons of political pressure to both the buyer and Dollar Bank.

However if I were Dollar bank I would go ballistic: They wrote a check for $7MM as a private enterprise and have first position on the property. Therefore the BK courts are legally obligated to make Dollar as whole as possible. From my understanding of the situation, unfortunately for Peduto & the county, the public funds that were used to create the AWC are gone, they were essentially gifts. Dollar Bank is a private enterprise that made a business deal with the operators of AWC and have recourse for non-payment which they are exercising. In any other situation Dollar would've gone after the AWC long, long ago but they were extra patient and passive due to the sensitivity of the situation. If Peduto gets his way, the repercussions could be significant, banks could get the wrong message and will no longer have enough confidence in the city government to partner on public/private deals AND we will end up with a piece of land that will not be utilized to its highest and best use which in this case is the hotel deal currently on the table which will bring the highest price and still, thankfully, maintain the mission of the AWC. I think that deal is a huge win-win for the city, the AWC and the community.

Originally Posted by BrianTH

Very disappointing comments from Peduto and Fitzgerald on the AWC bids:

http://www.post-gazette.com/local/ci...s/201404190088

I don't mind if they want to negotiate the best possible deal for the program as far as continuing in the building in some form is concerned. But the lenders have a right to insist the bids be evaluated in light of their expected recovery, and meanwhile a for-profit owner providing space to the program on a free or heavily subsidized basis may well be the most sustainable model. So I would hope these public officials would be keeping a more open mind.

[BrianTH]

I agree all around. My guess is that there are political reasons to support the foundation bid at this juncture, but hopefully if the courts and the bank insist on going with the developer bid, the politicians will then have the cover they need to act more productively.

[Eightball]

Originally Posted by photoLith

DSC_0267 by photolitherland, on Flickr
PNC from Mt. Washington a couple hours ago.

Beautiful photo!

[dfiler]

Originally Posted by BrianTH

Pittsburgh had relatively fast-growing rent prices from 2007 to 2012 according to a study of Census data by NerdWallet:

http://www.nerdwallet.com/blog/citie...growing-rents/

If you look at the other larger cities on the list, Pittsburgh remains relatively inexpensive. But presumably it has been making up some ground on other cities not on this list. That's good news for developers, but hopefully they can build enough new units to bring appreciation rates down to no more than average such that Pittsburgh will remain relatively affordable indefinitely.

I'm hoping that rental competition will drive people into my neighborhood, the regents square side of Wilkinsburg. There are currently many vacant buildings but the neighborhood could easily reach a tipping point and be brought back from its ghetto status. This would really benefit the tax base and eventually decrease the ludicrously high property tax paid by the few people with maintained homes. From there it would snowball, and living in Wilkinsburg would once again be appealing. Honestly, the best thing for Wilkinsburg would be to merge with Pittsburgh. (But that's another whole discussion.)

Pittsburgh has many other neighborhoods in a similarly derelict condition. Many people across the city are also hoping that the bad properties on their block will be bought and fixed up. While there isn't yet the population growth such that all of them will become inhabited and maintained again, the statistics are looking better every year. The population would actually be growing fairly quickly if it weren't for some rather interesting demographics. Because the average age of Pittsburghers is quite high, our mortality rate still eclipses the birth rate. Meanwhile though, more people are moving here than moving away.

One thing is for sure, the city has plenty of space for additional population. It's just a question of which neighborhoods will be brought back to life and returned to their previous population density.

[Private Dick]

Originally Posted by Wave

... not to mention the city & county probably have zero legal grounds to stop the sale to the highest bidder though they clearly can exact tons of political pressure to both the buyer and Dollar Bank.

I'm not sure about the intracacies of legal grounds in this case, but there are most definitely strong grounds that the AWC, Peduto, Fitzgerald, etc. stand on, which will certainly sway Dollar Bank's decisions (and already have).

No bank in its right mind is going to foreclose then completely remove a high-profile African-American Cultural Center which city and county government and local/regional foundations with multiple billions of dollars support.

Originally Posted by Wave

However if I were Dollar bank I would go ballistic: They wrote a check for $7MM as a private enterprise and have first position on the property. Therefore the BK courts are legally obligated to make Dollar as whole as possible. From my understanding of the situation, unfortunately for Peduto & the county, the public funds that were used to create the AWC are gone, they were essentially gifts.

The fact that city, county, and state public funds that went into development and construction are gone, really has nothing to with, and has no bearing on, Peduto and Fitzgerald's position. Private foundations in Pittsburgh have supported the AWC since day one... to the tune of providing 3/4 of its funding continuously.

Originally Posted by Wave

Dollar Bank is a private enterprise that made a business deal with the operators of AWC and have recourse for non-payment which they are exercising. In any other situation Dollar would've gone after the AWC long, long ago but they were extra patient and passive due to the sensitivity of the situation. If Peduto gets his way, the repercussions could be significant, banks could get the wrong message and will no longer have enough confidence in the city government to partner on public/private deals AND we will end up with a piece of land that will not be utilized to its highest and best use which in this case is the hotel deal currently on the table which will bring the highest price and still, thankfully, maintain the mission of the AWC. I think that deal is a huge win-win for the city, the AWC and the community.

Don't be that naive. Banks will go where there is money to be made. If Pittsburgh is as booming as we are made to believe, what you are suggesting is not an issue.

You stress that Dollar bank is a private enterprise twice. So what? So are the multiple foundations that have financially supported the AWC to a much greater extent than a relatively-minor player bank has. I think you would be well served to better understand how much capital (real and political) private foundations have, particularly in the Pittsburgh region. Peduto and Fitzgerald are smart enough to toe the foundation line... and also understand that anything but full support for the region's premier, specifically-focused cultural center -- envisioned as being a cathedral for Pittsburgh's deeply influential, but historically maginalized black population -- would be political suicide in the city.

[dfiler]

The post you're replying to seems to bee approaching the subject from an ideological viewpoint. That viewpoint likely heralds private enterprise, capitalism and free markets as the path to success and likely sees government involvement as a negative.

That could be somewhat of a misinterpretation. But it important to note that the AWC is a high profile topic and heavily politicized on all sides. Once that happens, it is difficult to discuss just that property and scenario without also making it a litmus test on ideology in general. It's almost as if weighing in with an opinion on the AWC means that you would like to further a similar agenda on all possibly related topics.

[Don't Be That Guy]

Originally Posted by Private Dick

... and also understand that anything but full support for the region's premier, specifically-focused cultural center -- envisioned as being a cathedral for Pittsburgh's deeply influential, but historically marginalized black population -- would be political suicide in the city.

You do realize that is how the entire misbegotten enterprise started. No one had the political will to say a standalone building on expensive real estate that would cater to a very small niche of the population (wealthy, black arts enthusiasts) probably wasn't a great financial idea. And few, including the funding foundations, had the will to speak-up early about the mismanagement of programming and staffing. The blatant marginalization and racism of yesteryear has prevented the local leaders from making pragmatic decisions about AWC, and other developments in the city, lest they also be accused of racism.

The Manchester Craftsmen's Guild does a great job of promoting the arts and African American culture to a broad spectrum of patrons. One has to wonder why AWC wasn't a more sustainable collaboration between them, Heinz History Center and community groups like the Hill House?

[Private Dick]

Originally Posted by dfiler

The post you're replying to seems to bee approaching the subject from an ideological viewpoint. That viewpoint likely heralds private enterprise, capitalism and free markets as the path to success and likely sees government involvement as a negative.

That could be somewhat of a misinterpretation. But it important to note that the AWC is a high profile topic and heavily politicized on all sides. Once that happens, it is difficult to discuss just that property and scenario without also making it a litmus test on ideology in general. It's almost as if weighing in with an opinion on the AWC means that you would like to further a similar agenda on all possibly related topics.

I agree with what you say.

And I don't hold a strong opinion on the fate of the AWC yet, considering that I don't fully understand what is involved with all of the bids. And I'm not suggesting that the ultimate best option that could result from this is not the center going to the highest bidder/what is favored by the bank, judge, legal system, etc. I just know that it is not as simple of a situation as a "private enterprise that made a business deal with the operators of AWC".

[Private Dick]

Originally Posted by Don't Be That Guy

You do realize that is how the entire misbegotten enterprise started. No one had the political will to say a standalone building on expensive real estate that would cater to a very small niche of the population (wealthy, black arts enthusiasts) probably wasn't a great financial idea. And few, including the funding foundations, had the will to speak-up early about the mismanagement of programming and staffing. The blatant marginalization and racism of yesteryear has prevented the local leaders from making pragmatic decisions about AWC, and other developments in the city, lest they also be accused of racism.

It wasn't envisioned to "cater to a very small niche of the population (wealthy, black arts enthusiasts)" at all. But your statement that it was is very telling of the attitude out there.

It was characterized by faulty planning in numerous areas from the get go -- in terms of focus, location, facility, organizational structure, and leadership. Its failure is hardly due lack of political balls to say that it couldn't work. And, the funding foundations most certainly did "speak-up" early on and continue to do so, which resulted in many changes in management and contributions.

It was a bold endeavor (particularly for a city like Pittsburgh, which has long been known as a highly unwelcoming place for minorities -- August Wilson himself couldn't stand living there) that was unfortunately not thought through properly at the onset and thus became severely dysfunctional very quickly. To dismiss the actual problems present and calling it leaders being afraid to be accused of racism is just really sad actually. There's no doubt that today's leaders are going to support its mission in order to support the region's population that has the deepest interest its continued existence and success, especially now that the building stands.

[BrianTH]

I think it is worth noting that retaining ownership of the building (and the air rights) is not necessarily in the best interests of the cultural program itself. And in fact I am sure part of why the developer has apparently offered to grant the program a very favorable lease is that it understands the prospect of simply evicting the cultural program wouldn't be a good idea.

So when looking at this from Dollar Bank's perspective, it gets complicated--it may have to take some heat in the short run if the developer wins out over the foundations, but if the AWC is still there and operating down the road, it may think that will be a satisfactory outcome once the issue dies down. And after all, it did move to foreclose on the building, so clearly it is not entirely shy about asserting its legal rights.

[Private Dick]

^ The bank had to foreclose though. It wasn't really about not being shy in that case.

I understand the bank's position and I also understand the foundations'/mayor, exec's position. It's not an easy fix by any means, and I have a feeling the foundations withdrawing their bids is just the beginning of a new chapter in this mess, unfortunately.

[WillyC]

Originally Posted by BrianTH

I think it is worth noting that retaining ownership of the building (and the air rights) is not necessarily in the best interests of the cultural program itself. And in fact I am sure part of why the developer has apparently offered to grant the program a very favorable lease is that it understands the prospect of simply evicting the cultural program wouldn't be a good idea.

So when looking at this from Dollar Bank's perspective, it gets complicated--it may have to take some heat in the short run if the developer wins out over the foundations, but if the AWC is still there and operating down the road, it may think that will be a satisfactory outcome once the issue dies down. And after all, it did move to foreclose on the building, so clearly it is not entirely shy about asserting its legal rights.

From what the foundations said today, it doesn't sound like the lease is very favorable. It sounds like the cultural center would have very restricted access to the theater.

Then again, it's why I wish the whole bid process was transparent so we could know if they are telling the truth.

EDIT: And then of course the conservator comes out and says they will have 120 days to use the theater, but that doesn't tell us much if there are limits on certain prime time parts of the year. The center could be essentially boxed out by the hotel and not able to take advantage of those dates.