Pittsburgh June 2021 – Key Take-Aways
• Developers are getting lots of RFPs, but there’s still some hesitancy to move ahead with projects, perhaps residual from Covid.
• Pittsburgh’s labor force is declining: In 2020, twice as many baby boomers retired as in typical years. This also may be attributed to seasonal factors, and after Covid, some people may be simply taking the summer off.
• This trend is balanced by good news that the unemployment rate is decreasing, except in mining and logging, manufacturing, wholesale, and the leisure, hospitality and services sectors.
• Developers are starting construction but have taken a hit with material costs, such as steel.
• Senior living and commercial development continue in the North Hills, with site work under way on the McCandless Square project and a couple of sites still available at McCandless Crossing.
• The robotic food company, Farms Close By, in McKeesport is growing vegetables, fruit, salmon and shrimp, and is looking to expand into hempcrete, sustainable housing, microgrids, farm-to-school programs, and nutritional education. The company may put a farm in the Hill District above a store.
• Multifamily housing is generating much of the construction activity, with about 2,000 units in some stage of design production or production.
• Pittsburgh was a decade behind peer cities in developing housing, so demand won’t stop anytime soon — expect it to continue at a strong pace for possibly three years.
• Flex warehouse office buildings and tech flex are also a strong trend, as old mill buildings are being redeveloped in Etna, Homestead and Uptown.
• High-end single family residential is also hot; individuals are seeking homes valued from $500,000 to $4 million.
• The Urban Redevelopment Authority (URA) seems to have a new philosophy: helping smaller companies get business beyond just as subcontractors.
• David Serbin of the URA gave an excellent overview of the agency’s new program — “Avenues of Hope” — which aims to redevelop historic business districts and major avenues in seven predominantly African American communities with affordable housing and new businesses in empty storefronts.
• These avenues are Homewood Avenue in Homewood, Centre Avenue in the Hill District, Second Avenue/Irvine Street in Hazelwood; Chartiers Avenue in Ingram; Perrysville Avenue in North Side; Warrington Avenue in Allentown; and Larimer Avenue in Larimer.
• Avenues of Hope will encourage the involvement of locals, from concept to construction, to help them build wealth and build their communities.
• Not all neighborhoods have Community Development Corporations (CDCs) so the Pittsburgh Housing Development Corp., a URA affiliate, can step in to assist with eliminating blight.
• The URA owns roughly 3 dozen structures and 1,200 vacant lots but cannot sell property to someone and let them sit on it; potential buyers must have shovel-ready projects and financing, drawings, permits and information on contractors.
• The URA has hired a manager of the land bank to try to clear properties faster and move them into projects.
• Opportunity Zones are a good way to park money and not pay capital gains tax; it’s a sweetener for investment in blighted or low-income neighborhoods, but the project must be a good one.
• Need: Aaron Reed of Reed Building Supply is looking to get involved in small-scale projects involving city or URA properties in the Centre Avenue/Hill District area and hoping for assistance.
• Need: AdVenture Development is hoping to partner with someone on multifamily housing.
• Pitt’s Office of Innovation & Entrepreneurship provides business consulting, networking and educational opportunities.
• New trend: McKeesport appears to be hot right now: “There’s magic there” with new development, and more to come.
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