PITTSBURGH | Development Rundown II

[BrianTH]

Oakland Portal is very important--in addition to adding much needed new square footage to Oakland, it should help push along Uptown/Bluff as well.

I just hope most of it is better-designed than the first apartment building.

[Private Dick]

Good news for Oakland. Oakland/Uptown needs something worthwhile here -- not cheap apartment junk like what was just built. Anyone who would pay $1400 per month for a one-bedroom in that building in Pittsburgh is crazy.

[Jonboy1983]

Originally Posted by Private Dick

Good news for Oakland. Oakland/Uptown needs something worthwhile here -- not cheap apartment junk like what was just built. Anyone who would pay $1400 per month for a one-bedroom in that building in Pittsburgh is crazy.

Yeah, seriously. Anyone who would pay $1400 a month for a one bedroom in Pittsburgh, period, is crazy, or they just have tons of disposable income they know not what to do with. Still, it's Pittsburgh; not Rittenhouse Square.

On a side note, there was an article in the Post Gazette about UPMC and their acquisition of very expensive real estate in the region, only to have it exempt from taxes to the city and county...

It still burns me that they bought up all that space in the US Steel Building. I had a problem with that then, and I still have a problem with that to this day...

[Private Dick]

Originally Posted by Jonboy1983

Yeah, seriously. Anyone who would pay $1400 a month for a one bedroom in Pittsburgh, period, is crazy, or they just have tons of disposable income they know not what to do with. Still, it's Pittsburgh; not Rittenhouse Square.

Yeah, it would be one thing if the apartments were nice, and were in a good location. They're not nice and they're actually in a pretty terrible location. Cheap materials inside and out. It's funny, builders put granite countertops in the kitchens of apartments, but every other surface (wall material, paint, bathroom surfaces and fixtures, flooring, carpeting, windows, etc.) are cheap 🞵🞵🞵🞵.

Anyone who would spend that type of money in rent for an apartment in that building is either stupid or just has no taste whatsoever... probably both.

[BrianTH]

And yet people are snatching up apartments in that price range as fast as they can be built in the zone between Downtown and Oakland.

Perhaps those tenants are all just stupid. But maybe a decent-sized new apartment with an incredibly short, cheap, and convenient commute to either of the two most important CBDs in the entire region actually has some inherent value, even if the building looks like a Motel 6.

[markson33]

Most people aren't like us and don't consider that to be bad architecture. They look at it as being new, clean and in a great location. I don't blame them for leasing there. Its not for me, but other people have different priorities.

Ryan, Maronda, S&A et al would not be in business if people cared about quality and design.

[Private Dick]

Originally Posted by BrianTH

And yet people are snatching up apartments in that price range as fast as they can be built in the zone between Downtown and Oakland.

Perhaps those tenants are all just stupid. But maybe a decent-sized new apartment with an incredibly short, cheap, and convenient commute to either of the two most important CBDs in the entire region actually has some inherent value, even if the building looks like a Motel 6.

Good point. This stretch is obviously poised for continued growth. Right now, where these new portal apts are is still kind of an awkward location... arguably a bad location in consideration of the lack of adjacent amenities, unpleasant surroundings (that's a main reason I can't see paying such a premium for rent, and then there's the building's low quality). It certainly isn't an attractive location yet.

That's what always puzzles me about people who pay premium rents in locations that will be nice areas in 5 years or so. Purchasing property in an area like that makes sense, but why pay rent (and really high rent relative to the market) in an area that isn't desirable yet? When, more than likely, you're not going to be living there once it is a nice place to live anyway. Once bigger development gets underway and more investment is put into the area, then I can start to see the justification. Certainly, can't beat the convenience of the location. I'm really hoping the rest of this portal project is much more impressive. Like you said earlier, it is very important that it's done right.

Originally Posted by markson33

Most people aren't like us and don't consider that to be bad architecture. They look at it as being new, clean and in a great location. I don't blame them for leasing there. Its not for me, but other people have different priorities.

Ryan, Maronda, S&A et al would not be in business if people cared about quality and design.

Very true. I think I have to be reminded every now and then that I probably look at real estate developments, particularly in Pittsburgh, with a much more critical eye than the average person... particularly if looking for an apartment/house/condo. My main thing is that I want the best for Pittsburgh (especially in important areas of the city)... and maybe sometimes my "standards" are not all that realistic.

[Private Dick]

While we're on the topic of development in the Uptown corridor, does anyone know anything about that apartment building that was proposed last year?

I want to say it was proposed at 7 stories maybe?

[markson33]

Ongoing terminal project issues.
http://http://www.post-gazette.com/stori...elopment-on-allegheny-riverfront-654730/

[Jonboy1983]

Dare I post an article from the PG and/or the Trib about the Allegheny Valley Railroad threatening to sue over the proposed Buncher development? They don't want to see the Produce Terminal leveled for a street extension. They want to have it reserved for future wholesalers or a "rail-oriented" use.

Really? What type of rail-oriented use are they anticipating? It says that freight trains do serve teh building for wholesalers' merchandise, but I really don't see any tracks left in the vicinity of that building. Even at that, what ever little freight trains that serve that are really not doing a whole lot for the city IMO. The whole thing is an eyesore. I know the AVR is proposing to have a commuter rail line travel along the Allegheny River, but I think its ROW that will be used is above 21st street. I believe it will use part of the NS/Amtrak ROW and extend down to Steel Plaza by means of Port Authority ROW...

[GeneW]

Originally Posted by Private Dick

Yeah, it would be one thing if the apartments were nice, and were in a good location. They're not nice and they're actually in a pretty terrible location. Cheap materials inside and out. It's funny, builders put granite countertops in the kitchens of apartments, but every other surface (wall material, paint, bathroom surfaces and fixtures, flooring, carpeting, windows, etc.) are cheap 🞵🞵🞵🞵.

Anyone who would spend that type of money in rent for an apartment in that building is either stupid or just has no taste whatsoever... probably both.

People aren't buying them just renting them, so they probably don't really care how good the fit and finish is. Chances are people are only going to live in them for a few years while they finish grad school or do a medical internship, I doubt that too many people will live there long-term. And those prices seem inline with what new apartments are getting in the 'burgh these days, hard to find anything under $1k a month.

[Austinlee]

Originally Posted by GeneW

People aren't buying them just renting them, so they probably don't really care how good the fit and finish is. Chances are people are only going to live in them for a few years while they finish grad school or do a medical internship, I doubt that too many people will live there long-term. And those prices seem inline with what new apartments are getting in the 'burgh these days, hard to find anything under $1k a month.

Yes rents are high right now. Metro wide you can't find a rental almost anywhere even in bad areas regardless of price. There is pent up demand for housing right now. I predict a housing and/or rental construction boom in the next year or two.

[BrianTH]

New (and on the bigger side, which often goes along with new) also has appeal for many people, and I think the market for new apartments in the core area is WAY undersupplied right now.

[markson33]

Originally Posted by BrianTH

New (and on the bigger side, which often goes along with new) also has appeal for many people, and I think the market for new apartments in the core area is WAY undersupplied right now.

I agree, but Pittsburgh developers aren't going to want to take risks. Look at all the projects that PMC properties is doing. Why does it take a developer from Philly to realize the potential for these projects?

[BrianTH]

Originally Posted by markson33

I agree, but Pittsburgh developers aren't going to want to take risks. Look at all the projects that PMC properties is doing. Why does it take a developer from Philly to realize the potential for these projects?

I don't think that is entirely accurate. Walnut is doing a bunch of stuff, Millcraft is doing stuff, various smaller local entities are doing stuff . . . personally, I think the main problem is just financial markets which are still unusually constrained, plus maybe some of the other national developers still not seeing what PMC sees (but that is an old story--PMC was way ahead of the game in Philly too).

[Private Dick]

Originally Posted by GeneW

People aren't buying them just renting them, so they probably don't really care how good the fit and finish is. Chances are people are only going to live in them for a few years while they finish grad school or do a medical internship, I doubt that too many people will live there long-term. And those prices seem inline with what new apartments are getting in the 'burgh these days, hard to find anything under $1k a month.

Yeah, I understand that they're only renting them. And I know that very nice 1-bdrm apts in Pittsburgh in a nice building with many amenities in a good location command $1K+ per month..... but these portal apartments are none of that... yet they are priced at $1250-$1400/month.

Maybe it's just me, but if I'm paying a premium to rent in a city like Pittsburgh, it's going to be a damn nice apartment. It just seems to me to be an incredible waste of money to spend that much on one of those apartments.

Originally Posted by BrianTH

New (and on the bigger side, which often goes along with new) also has appeal for many people, and I think the market for new apartments in the core area is WAY undersupplied right now.

True on both counts. The number of available apartments in Pittsburgh's core is FAR from meeting demand. Try to find a decent apartment in the East End for evidence.

Originally Posted by markson33

I agree, but Pittsburgh developers aren't going to want to take risks. Look at all the projects that PMC properties is doing. Why does it take a developer from Philly to realize the potential for these projects?

I think outside developers coming in is pretty common in many cities though -- especially developers who are smaller players in their home markets, like PMC, coming to smaller markets (like Pittsburgh as compared to Philly) where property is cheaper, yet where there is still wide availability of older structures suitable for rehab into residential.

I don't really think it's a case of Pittsburgh developers not seeing the potential for these projects. But I think you are correct in that Pittsburgh developers don't want to take the risk -- mainly because they simply can't take larger risks because they generally lack the capital required to do so.

[Austinlee]

So it looks like the Locomotive Lofts are making progress. Announced last year, the $5.5 million project in Lawrenceville will create 34 new Leed gold apartments at 49th and Harrison.


http://www.amrodriguezassociates.com/locomotive.php

Here's a quick video from two months ago in the news.
http://pittsburgh.cbslocal.com/2012/07/1...nd-on-locomotive-lofts-in-lawrenceville/

[Austinlee]

TOD!!

$41.5 million dollar transit oriented development with 300,000 sq ft of residential coming soon to the South Hills T station.
I think this type of development is one of the most important kind of real estate to help to continue to bring back vitality to Pittsburgh.

http://www.popcitymedia.com/devnews/tod092612.aspx

[Austinlee]

The Chapel Pointe condominiums (Chapel Harbor waterfront) are on the market now ranging from 300s-600s. Located in Fox Chapel (O'Hara). There are 53 "New York Style" condos. *sigh* (Personal pet peeve; Why does everything have to be New York Style?)



http://www.chapelpointecondos.com/

[glowrock]

Originally Posted by Austinlee

TOD!!

$41.5 million dollar transit oriented development with 300,000 sq ft of residential coming soon to the South Hills T station.
I think this type of development is one of the most important kind of real estate to help to continue to bring back vitality to Pittsburgh.

http://www.popcitymedia.com/devnews/tod092612.aspx

No doubt, this is excellent news for the South Hills. Not only are more apartments sorely needed (heck, my bet is that these units are all rented out within 30 days or less of them being completed!), but TOD's are sorely needed all around the T stations.

Aaron (Glowrock)