Posted: Mar 21, 2012, 1:13 PM
I've got a bad reputation
Join Date: Apr 2003
Penguins take first step toward rebirth of arena site
By Mark Belko, Pittsburgh Post-Gazette /
With the demolition of the Civic Arena close to completion, the Penguins are gearing up to market the 28-acre site for redevelopment.
The team has hired global real estate services firm Jones Lang LaSalle to begin marketing the land to prospective developers and tenants, the first tangible step in its bid to transform the site into a residential, office and commercial development.
Jones Lang LaSalle will serve as the Penguins' representative on the project. In addition to marketing the property, it will help the team to select one or multiple developers for the redevelopment; update the market analysis to determine the right mix of office, residential and commercial space; and assist in discussions with the city and stakeholders in the Hill District, Uptown and Downtown in the planning for the site.
Penguins officials said the hiring of Jones Lang LaSalle shows their commitment to redeveloping the land after the lengthy battle over the future of the Civic Arena, which is being demolished to clear the path for their project.
With the firm on board, the team plans to begin discussions immediately with prospective developers and anchor tenants, including possible retailers, although it likely will be months before anyone is selected. It is considering whether to use one master developer for all 28 acres or separate office, residential and commercial developers.
With the economy showing signs of a comeback, David Morehouse, the Penguins' CEO, said it is a good time to begin marketing the site.
"This is a rare opportunity for a city of this size to have 28 acres of developable land adjacent to its central business district. It's happening in Pittsburgh at a time when the economy is moving forward. So it's a perfect storm of opportunity if done in the right way. We're committed to doing our part to make sure that it happens," he said.
The Penguins are proposing 1,200 units of housing, 600,000 square feet of office space and 200,000 square feet of commercial space at the site, which borders Crawford Square in the Hill District and Uptown and sits across the street from the Consol Energy Center.
But with Downtown Class A office space at a premium and high demand for Downtown housing, Travis Williams, the Penguins' chief operating officer, said the team may boost the amount of square footage devoted to both.
"Because of the recent upsurge in office occupancy associated with the Marcellus Shale industry, there is more of a demand than we had a couple of years ago," Mr. Morehouse noted.
Team officials also will be seeking a Leadership in Energy and Environmental Design (LEED) for Neighborhood Development rating for the project. They are considering an on-site plant to generate power for the development and construction materials that will help buildings achieve LEED certifications. The Consol Energy Center received a LEED Gold rating, the first National Hockey League arena to achieve that distinction.
Mr. Williams said the goal is to make the 28 acres a "marquee green sustainable development."
While hiring an owner's representative and marketing the land are key steps for the Penguins, much work still remains.
The city-Allegheny County Sports & Exhibition Authority has yet to raise the estimated $40 million needed to add infrastructure to the site, most of which it owns. It recently hired Moon engineering company Michael Baker Jr. Inc. to begin design work for the infrastructure, but it still needs millions of dollars to pay for the final design.
The Penguins won the development rights to the property as part of the 2007 agreement with state and local leaders to build the Consol Energy Center and stay in Pittsburgh. Under that agreement, the team must begin developing the land a year after the Civic Arena demolition ends. The arena is expected to be down by the end of May.
As part of the 2007 deal, the Penguins have the option of using the land on which the arena sits for parking until it is developed. Critics have pointed to that provision to claim that the team has no intention of developing the property, given how lucrative parking revenue can be.
But Penguins officials insisted again Tuesday that parking is but an "interim" use before the land is developed. They said they never would have hired Jones Lang LaSalle if they were going to keep it as a parking lot.
"We have a track record of having done what we said we were going to do. And we're going to continue to do that. It's important to our ownership group, it's important to us, and it's important to the city that we develop this site," Mr. Morehouse said.
Jones Lang LaSalle has more than 200 corporate offices worldwide and 45,500 employees. It serves as real estate adviser to the Port Authority of New York and New Jersey on the World Trade Center redevelopment. It also has been involved in the planning for the reuse of Olympic facilities in London after the 2012 games.