Cre Finance Update

DEVE LPittsburghOPINGFall 2013 CRE FINANCE UPDATE

2013 BUYER’S GUIDE

MID-YEAR MARKET UPDATES

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CONTE NTS

05 President's Perspective

23 Development Project ANSYS/Zenith Ridge at Southpointe II

37 Developer Profile Imperial Land Corporation 06 Commercial Real Estate Finance Update As the economy and fundamentals for commercial real estate continue to improve, Eye On the Economy the big question is: Are lenders ready to finance expansion again? 42

44 Office Market Update Grant Street Associates

46 Industrial Market Update Newmark Grubb Knight Frank

50 Retail Market Update Langholz Wilson Ellis

37 Developing Trend 54 National Market Update CBRE Bus Rapid Transit could be the Oakland-to-Downtown solution.

59 Legal / Legislative Outlook 65 Benchmarks Revisions to the Mechanics Lien law would give owners more certainty. Retiring Greater Pittsburgh Chamber of Commerce president Barbara McNees reflects on a career in economic 69 Voices development and the changes that have Developing Leaders offer a suggestion to taken place in the Pittsburgh region. Pittsburgh’s next mayor.

73 New from the Counties 2013 Buyer’s Guide 83 People & Events 86 Buyer’s Guide The 2013 NAIOP Buyer’s Guide puts contacts for designers, engineers, contractors and lenders in one easy-to-use resource. www.developingpittsburgh.com 3 CBRE Lights Up Pittsburgh MANAGING AND/OR LEASING PITTSBURGH’S PREMIER OFFICE BUILDINGS

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PUBLISHER Tall Timber Group t’s a great time to be Finally, our NAIOP Pittsburgh members www.talltimbergroup.com in commercial real enjoy two of the best annual network- estate in Pittsburgh. ing events in the city: Night at the EDITOR We have one of Fights and our Annual Awards Dinner. Jeff Burd the best overall real We continually explore other ideas to 412-366-1857 estate markets in the create additional value for our mem- [email protected] country and,I by all accounts, it will only bers. To that end, we will be rolling get better. It’s also a great time to be a out a new networking and information PRODUCTION member of NAIOP Pittsburgh. We too event this fall to provide Pittsburgh’s Carson Publishing, Inc. are enjoying success as demonstrated real estate community with the “NAIOP Kevin J. Gordon by our membership, which has reached Commercial Real Estate Summit”. We [email protected] the highest level in chapter history. This plan to bring the regional leaders in our additional bench strength allows us to business – those who are on the front ART DIRECTOR/GRAPHIC DESIGN expand our committee membership and lines every day – to share their observa- Carson Publishing, Inc. further advance our core values of lead- tions and predictions about the future Jaimee D. Greenawalt ership, education and advocacy. of our market here in Pittsburgh. Again, look for more information in a month CONTRIBUTING PHOTOGRAPHY Our efforts in advocacy have resulted in or so. Carson Publishing, Inc. many key development initiatives – like Port Authority of Allegheny County the addition of the ramps at I-79 and Enjoy this edition of DevelopingPitts- Pittsburgh Regional Alliance I-376, as an example. More recent advo- burgh. The focus of the magazine is The Greater Cleveland Regional cacy efforts include changes to amend commercial real estate finance, an Transit Authority the Pennsylvania Mechanics Lien laws. industry near and dear to me, but also Our dedication to education includes includes current market data and input CONTRIBUTING EDITORS our popular and informative chapter from the 10-county region that makes Anna Burd meetings which provide timely and rel- up the Pittsburgh market. It’s one more evant monthly informational programs of NAIOP Pittsburgh’s continued efforts ADVERTISING SALES that are second to none. to keep our members informed. Please Karen Kukish consider your willingness to participate 412-837-6971 A goal that I have for my presidency in the mentoring program. Also, visit [email protected] is to further our leadership efforts by the NAIOP website (www.naioppitts- rolling out a mentoring program for burgh.com) and look for notes from us MORE INFORMATION: our chapter’s Developing Leaders – our as our new programs draw closer. DEVELOPINGPittsburgh is published by fasted growing membership group in Tall Timber Group for NAIOP Pittsburgh NAIOP. NAIOP has put particular empha- Regards, 412-928-8303 sis on our emerging professionals over www.naioppittsburgh.com the past few years. I feel that reaching back to the next generation of profes- No part of this magazine may be sionals in our industry is an obligation reproduced without written permission by the Publisher. All rights reserved. and a privilege we have as an organization. Engaging younger people in com- This information is carefully gathered and compiled mercial real estate is another way that in such a manner as to ensure maximum accuracy. we can ensure that the best young tal- We cannot, and do not, guarantee either the ent is attracted to Pittsburgh and grows correctness of all information furnished nor the here. Those goals are the foundation of complete absence of errors and omissions. Hence, responsibility for same neither can be, nor is, our Developing Leaders group. The spe- assumed. cifics of the program are being finalized and we expect to announce the details Keep up with regional construction and real estate in September. However, our goal is to events at www.buildingpittsburgh.com identify mentors from our membership that would allow the Developing Lead- ers to meet for an informal, interactive discussion with the mentors. We hope to get a strong participation from our chapter members. Daniel P. Puntil NAIOP Pittsburgh President

www.developingpittsburgh.com 5 f e a t u r e

FINANCIAL MARKET UPDATE

6 DEVELOPINGPITTSBURGH | Fall 2013 f e a t u r e

Over the past year there has been a calming of much of the volatility in the reporting of business and economic conditions. That change has corresponded to a calming in the volatility of the actual economy. Since the financial crisis, reporting about business – which is hardly front page news in most eras – has continually harped on what may be the next unknown crisis to trip up the economy. After five years, most media outlets are covering business in the manner they did prior to the crash and the global economy itself seems to be offering less to write about as well. Business news has become boring again.

www.developingpittsburgh.com 7 f e a t u r e

urozone debt crises have for a commercial real estate trans- mand fundamentals for commercial faded. The stock market is action. What all the lenders have in real estate haven’t been good since chugging upwards towards common in today’s market is that before 2008 but the lack of return new records. The ‘fiscal the interest rate they can charge for cash in traditional conservative cliff’ and Social Security for the funds they provide is lower investments has pushed investors withholding increases had than almost any time in history. At to look at what are normally riskier more impact before than the same time, the spread between asset classes for better yields. One after the events took place. Even the cap rate for commercial prop- of those asset classes that has been Ethe threat of the Federal Reserve erty and the return on the 10-year in favor is real estate. eliminating its bond-buying pro- Treasury bill is historically high, gram has been processed and ab- between 400 and 450 basis points This counterintuitive love affair sorbed – priced in to the affected for the last five years. with real estate is a bit confusing securities. More importantly, the for lenders. Commercial property actual reporting of economic data These are conditions that should be values declined by more than 40 continues to get sunnier, especially great for commercial real estate fi- percent in 2008 and 2009, yet by reports that look back on the most nancing but the conditions are also 2010 the total returns on commer- recent estimates of activity. With somewhat extraordinary because cial real estate in the U. S. aver- each new report, the previous esti- both rates and spreads are essen- aged 14.5 percent. For the time be- mates seem to be revised upward. ing, low rates are making All of this is good for commercial real estate a real estate. Higher than expected hot commod- GDP growth, lower than expected ity and lenders unemployment, higher consumer are returning spending than expected all add up to the game, to better conditions for the busi- especially nesses that rent commercial space. in areas like That, of course is better for the Pittsburgh, developers and landlords of com- where commercial property. The remaining mercial prop- question mark for real estate is erties have whether financing is up to the task held up well. of lending to meet the demands of the market. “Commercial real estate is It was, after all, the overexten- a great loan sion of credit that was at the root investment of the crisis and recession. In for the bank,” response, lenders and regulators CMBS volume is finally approaching says Northwest went to great lengths to assure the levels seen in 2004. Savings Bank that getting credit is not an easy regional president Chris Martin. process. In the years following the “Most banks are in pretty good crash, banks and other lenders shape. They have come through swung the underwriting pendulum What all the lenders the crisis, cleaned up their balance as far away from the standards of sheets and bad loans. They have the mid-2000’s as possible. That’s a have in common in built up capital and there are very natural human reaction. As the fear today’s market is that few ways to earn on capital except of the meltdown recedes and devel- to lend.” opers ramp up projects, the ques- the interest rate they tion is: are lenders ready to support can charge for the “We feel commercial real estate in expansion again? our market territory is solid. We funds they provide is like what we see and want to sup- What the Lenders lower than almost any port our customers in commercial Are Feeling real estate,” notes David Antolik, time in histor y. senior executive vice president Whether the source of the credit and chief lending officer for S & T is a traditional bank, life insurance Bank. “In Pittsburgh, for one of the company, real estate investment first times we have investors from trust (REIT) or commercial mort- tially artificial, the result of Federal outside the region just chasing gage backed security (CMBS), there Reserve fiscal policy rather than the yields. Retirement funds are look- will be varying degrees of support market action. The supply and de- ing at Pittsburgh, particularly the

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CBD, as relatively cheap compared BB&T Bank’s senior vice president to other markets.” Bruce Sharp. “There are too many banks chasing too few loans, how- These comments are fairly typi- ever. Borrowers are seeing favor- cal for bankers in Western PA and able terms and conditions." other regions, for that matter. The programs put in place to prop up Sharp’s point is being echoed by bad balance sheets and encourage a number of lenders. Chris Mar- lending after the financial crisis – tin sees interest margins being remember TARP and TALF – were squeezed. Dollar Bank’s Jack Shel- very good at the former and failed ley is concerned that competition at the latter. Lenders were able among banks has already heated to to borrow money overnight at the the point that underwriting stan- Fed’s window for one-quarter of a dards are becoming more forgiv- percent and ‘sell’ the funds back to ing than the market deserves at the Fed at a two percent margin. the moment. As low interest rates That spread was nearly what the have hung around for half-decade margins were on lending – exclud- already, pressure is building from ing fees – and there was no risk. investors to find better earnings This certainly helped banks build and that creates pressure to close reserves against which they could deals for bankers. Seasoned lend- write down the bad loans on their ers worry that pressure will lead to books. That was a necessary first relaxed discipline in underwriting. step but given the uncertain state of the economy, there was little incentive for banks to lend money when the expectations were that “There are government the rates they could get for loans in a few years would be higher. The grants, new market risks associated with lending out tax credits, historic money for 10 or 15 years weren’t in line with the returns. tax credits and other programs that are Since 2011, however, many lenders have seen the environment as one needed to bring the in which they could grow by taking cost down.” share that their competitors would not. As the global economy seemed to be repairing, the perceived risks of the projects declined and the “Conventional finance is a thing opportunities to shift the risk by of the past. The capital stacks are selling the loans in the secondary much more complicated than be- markets increased. Especially in a fore,” observes Jim Noland, presi- healthier region like Pittsburgh, dent of PenTrust Real Estate Advi- banks began to look for deals. sory Services since 1987. “There are government grants, new market “We have had about 14 straight tax credits, historic tax credits and quarters of growing our loan other programs that are needed to portfolio but we did it by sticking bring the cost down.” to the basics,” says Bob Powderly, senior vice president for investment Noland says that the additional en- real estate at First National Bank. hancements are essential in urban “Our underwriting evaluated the development, where construction cash flow, looked at debt coverage costs are significantly higher. He and conservative rent increase pro feels that one big difference with formas. We were pretty conserva- the rising costs from previous mar- tive or at least pretty vanilla.” ket conditions is the uncertainty of the project’s appreciation. “Our bank has a growing appetite for construction lending. We’re “Part of it is that inflation has looking at more deals,” agrees been so low. Inflation is the friend

www.developingpittsburgh.com 11 f e a t u r e

can’t drive flux of new businesses and growth the pro for- in our strongest businesses. Real ma to eight estate expansion is coming. More- percent infla- over, investors are looking for more tion when places to put cash and that will it’s really drive more deals. two or three percent. You Chasing Yield have to have other sources One of the best examples of money to make up driving a market is in the multi- the differ- family sector. At the depth of the ence.” recent downturn, the fundamental support for multi-family housing Whether was very strong, even though that concerns are wasn’t necessarily a good thing. about com- More people were unable to af- petition or ford to own housing and increased about the the number of renters. The lack of Rates for the bellwether 10-year Treasury and conventional 30- higher costs multi-family development meant year mortgages remain below the levels of the first quarter of of develop- that fewer units were avail- 2011 and well below historical norms. Source: Federal Reserve ment, lenders will have to able when the number of renters Board, Wells Fargo Securities. figure out how to work jumped. Demand quickly outgrew with the conditions be- supply and rents went up. cause the market is looking of commercial real estate but now for more deals rather than While those were factors that cre- it’s hard to project how the build- fewer. The economy is improving. ated the need for more apartments, ing will appreciate,” he says. “You In Pittsburgh, we are seeing an in- recessionary conditions aren’t

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12 DEVELOPINGPITTSBURGH | Fall 2013 f e a t u r e usually supportive of new develop- in multi-family grew each year but and Fannie Mae, Freddie Mac and ment. Many apartment developers so did private investment in multi- HUD were additional catalysts with also own other commercial real family of all kinds. very favorable financing programs. estate and weren’t in a position to build. Into the void came the life Money was looking for a place to As of 2013, construction of multi- insurance companies with cash and land and there were only so many family units will reach roughly favorable terms. multi-family deals. The common 325,000 units nationwide – with sense result would be for investors some 2,500 units starting in Pitts- The insurance companies needed to begin to look elsewhere but in a burgh – and inventories will be a way to offset the loss of yield roughly 40 percent above the as interest rates plummeted. Life 15-year average for apartments. insurers have obligations to deliver The insurance Vacancy rates remain low but the ‘conservative’ returns to their poli- market seems to have caught on cy-holders and investors. The defi- companies needed a that this segment should slow nition of conservative – anywhere way to offset the loss down. That doesn’t mean the ap- from four to six percent depending petite for yield is diminishing. on when the policy was written – of yield as interest was suddenly several hundred basis There still is an imbalance between points above inflation and much rates plummeted. the amount of capital chasing higher than the Treasuries were commercial real estate and the yielding. Part of the solution was number of quality deals that exist. for insurance companies to invest boom, common sense usually takes Transaction volumes are increasing. in apartment complexes. Between a break. Developers were sidelined CoStar reports that repeat sales 2009 and 2011, rents were climb- during the recession and multi-fam- have increased 25 percent during ing at or above five percent annu- ily offered an opportunity to de- the first five months of the year. ally, making the kinds of returns velop again because the funds were Time on the market declined 5.1 the life companies needed. During chasing the deals. Anxious inves- percent and the difference between that time, life insurance investment tors were fueling new construction the asking and selling price shrank

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to 2.2 percent. Yet office, retail across all segments of the risk and warehouse sales remained 35 spectrum. Investment banks as- percent below the levels of the last semble commercial mortgages that recovery period, between 2004 and banks have sold into bonds of 2007. This means there is more multiple loans, with ratings for the capital waiting to be deployed. various loans according to credit quality. Loans with similar credit The Return of CMBS worthiness are bundled together into tranches that offer higher One place that the capital supply is rates of return for lower ratings, showing up is in the CMBS market. since lower credit quality merits a Once the darling of investment higher interest rate on the loan. products, CMBS essentially disap- Investors can choose to buy the peared after the financial crisis. As bonds that have a credit quality the appetite for deals has grown, that matches their comfort level. the tolerance for the risk inher- A transparent, fully-functioning ent in commercial mortgages has CMBS market allows for projects also increased, allowing investment with higher risk to find financing. banks to buy and package mortgages again. “I think CMBS lending will continue to return as there is a definite CMBS plays an important role in need for it in the secondary mar- the financial markets, just as all ket. It provides a source of liquid- asset backed securities do. When ity that can’t be filled by any other functioning properly, CMBS deals platform in the permanent debt allow investors to allocate capital arena. Not every deal fits the Fan-

nie Mae, Freddie Mac or life insur- “I think CMBS ance company parameters.” says Dan Puntil, senior vice president for lending will continue Grandbridge Capital in Pittsburgh. to return as there is “Certain deals cater to CMBS, like hospitality for example. There is a definite need for always a need for CMBS execution it in the secondar y to fill the void for other permanent lenders who won’t do certain kinds market. of deals.”

14 DEVELOPINGPITTSBURGH | Fall 2013 f e a t u r e

At the peak of the finance bubble in 2007, CMBS volume reached $225 billion in the United States and more than $350 billion worldwide. Like what happened with residential mortgages, buyers for CMBS didn’t seem to care what was in the bonds – and the ratings agencies helped make that less transparent – as much as they did that there were bonds to buy. That’s the difference between CMBS and conventional forms of finance. In a conventional loan situation, the lender needs to be comfortable with the risk of repay- ment. With CMBS, that dynamic still exists at the loan level but then there must still be buyers for the bonds to which the loans Historically low interest rates have held are tied. When the crash occurred in slightly higher funding levels cap rates at or below the norms for the no one wanted to buy commercial for the developer and no recourse, past two business cycles. mortgages. or collateral pledged, because the buyers of the mortgages have – The recovery has healed the market theoretically at least – factored rates – the borrowers – have to for the most part. CMBS volume is that risk into the pricing. Under- look at deals done during this en- forecast to be $70 billion or more writing for CMBS had stiffened vironment as problematic in a few in 2013, roughly double that of during the downturn too but as years. 2011 and 2012. Mark Popovich, demand for the bonds grows, the managing director for HFF in Pitts- standards are relaxing. Starting from the assumption that burgh sees the recovery as nearly the interest rates are going to have complete. “Standards are getting more ag- to rise again, there are three main gressive but we aren’t going to risks associated with higher rates: “CMBS is definitely on the return. I see 80 percent loan-to-value and investment flight; operating income don’t see getting back to the $200 ten-year interest only deals again,” declines and cap rate decompres- or $300 billion range again but it says Popovich. “We are seeing 75 sion. may get to $90 to $100 billion in the percent loan-to-value and one year next few years,” he predicts. “CMBS of interest only.” As the corollary to the phenom- is getting very active. The market enon that lower yields have created had a hiccup after the Bernanke re- “As long as there are buyers of higher demand for commercial real marks – any time there’s a disruption commercial paper, the CMBS mar- estate as an investment and pushed in the market CMBS gets whipsawed ket will push to create the addi- up property prices, higher inter- – but things re-priced and settled tional value that people go to for est rates could have the opposite down in a few weeks. In fact, the CMBS,” predicts Puntil. “We have effect; that is, investors would opt last sale went off and prices came in seen it go from 65 percent loan- to have their cash earning interest a little better than expected.” to-value to 70 percent, now 75 if the rates were four percent or percent. Will it go back up to 80 more. While there is some merit to Pricing for CMBS issuances reflect percent? I don’t know, but they the theory that investors measure the risk the market is feeling. Like will try.” real estate risk versus the 10-year with any bond sale, buyers may at- Treasury, the evaluation isn’t an tach a risk premium that decreases The Interest Rate/Cap either or kind of test. The Treasury the funds raised in the sale. Bond Rate Conundrum bond is a risk-free investment. issuers try to anticipate that risk Commercial real estate is inherently premium in advance and price the The Federal Reserve’s decision to more risky but the returns have deal accordingly. When prices come drop interest rates to the floor may typically been two or three times in better than expected, the funds have prevented the financial crisis higher than the 10-year yield. raised increase. from becoming a full-scale rout but the after effects have created prob- “I think the Treasury is about a The attraction of CMBS to develop- lems for lenders. Even the parties global event or something that ers is that those deals usually result that benefitted most from the low triggers fear. There’s always a flight

www.developingpittsburgh.com 15 ZenithRidge in SouthPointE

full-service, turnkey approach to design and construction DEVELOPMENT sErVicEs • buiLD-TO-suiT • DEsigN-buiLD • cONsTrucTiON MaNagEMENT • arcHiTEcTurE • ENgiNEEriNg • PLaNNiNg • LaNDscaPE arcHiTEcTurE • iNTEriOr DEsigN • urbaN DEsigN claycorp.com f e a t u r e to safety. Whether the Treasury Connecting ideas, is yielding one percent or two- and-half percent, that's where capital and clients. money goes,” says Popovich. “If everything else is healthy and the T-bill is at 4.5 percent, then everything else is going to be Grandbridge Real Estate Capital provides the vital link between complex market higher anyway.” conditions and capital solutions. As a national full-service leader in commercial and multifamily finance, we combine our wide range of capital sources with a knowledgeable The more realistic problem and experienced team to deliver results, deal after deal. from higher rates will be the impact on a property’s operat- our scope of services includes: ing income. Operating expenses ® shouldn’t increase just because - Freddie Mac Program Plus Seller/Servicer | Seniors Housing of higher rates but the cost of - Fannie Mae DUS® financing certainly will. Such an - FHA-insured Loans | MAP and LEAN increase will degrade the build- - Nearly 50 Insurance Companies ing’s internal rate of return, - CMBS | Institutional Investors | Pension Funds a disappointment for current - Proprietary Lending Platform | Structured Finance - $29 Billion+ Loan Servicing Portfolio Cap rate doesn’t tell C o n t a C t U s the lender the full Two Gateway Center | 603 Stanwix Street | Suite 1899 story but it’s one of Pittsburgh, PA 15222 | Phone 412.391.3366 | Fax 412.471.1773 many ratios used to grandbridge.com analyze the viability Loans are subject to credit approval. Equal Housing Lender. of a deal.

performance with a variable rate loan and a real problem at the time of refinancing.

“An increase in interest rates without a corresponding income growth could cause problems in some regions, and Pittsburgh is one of them,” explains Paul Griffith, managing director for Integra Realty Resources. “That’s particularly true with these construction loans for apartments when they go for permanent financing in two years. Will the pro forma still hold up?” Providing Engineering Services Since 1966 “The new risk I see is rising rates. What are rates going to Foster Plaza 9, 750 Holiday Drive, Suite 700 Pittsburgh, PA 15220 do to our existing loans?” asks Powderly. “We’re evaluating our 412-521-3000 | www.pennoni.com loans at every 100 basis point increase.” Powderly says that Construction Services • Energy & Sustainability • Environmental • Geotechnical they are looking at the differ- Laboratory Testing • Landscape Architecture • Fabrication Inspection ence between any increased MEP • Municipal • Planning • Site Design • Structural Survey & Geomatics • Transportation • Water/Wastewater

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costs and the pro forma rent fore- A building with a value of cast. “We are looking to fill any $1,000,000 that has a net operat- gaps with equity or other proper- If interest rates ing income of $100,000 has a cap ties.” rate of 10 ($1,000,000/$100,000). do rise because Decrease that NOI to $50,000 and Rate-driven declines in operating the economy is the cap rate drops to 5. Lower income performance will have their rates artificially increase the in- biggest impact on cap rates, which becoming more come and therefore, the value of will have a significant impact at the property. The concern among refinance. robust, then all lenders is that if rates rise, property values will tumble, lifting cap Cap rate or capitalization rate is the components rates. At the time of refinancing a quick measure of a property’s or the conversion of a construction value by comparing the net operat- of a building’s pro to permanent loan, that can mean ing income to the present value of a more difficult case for financing the property. It’s a quick tool for forma – stronger the property. There is some histori- comparing a building’s performance absorption, lower cal evidence however, that periods versus the rest of the market and of increasing rates don’t necessarily its competitor properties. Each vacancy and higher mean higher cap rates. building has its own set of income and rate of return expectations. rents –will also According to the National Council Cap rate doesn’t tell the lender of Real Estate Investment Fiducia- the full story but it’s one of many improve, leading ries’ (NCREIF) database, private real ratios used to analyze the viability estate had an average annual re- of a deal. Lenders like ratios, so to higher net turn of 12.2 percent during the six cap rates count. A quick look at an operating income. periods of rising rates dating back example will tell you why that is. to March 1978. That ranks highest among the major asset classes,

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187.875x4.75.inddDEVELOPINGPITTSBURGH 1 | Fall 2013 1/14/13 12:05 PM f e a t u r e including bonds, the Standard & a significant rotation from investors and stabilization of the project. Poors 500 Index and equity REIT’s. in bonds to stocks or cash. Bond The permanent financing markets Moreover, the impact of higher prices fell and yields rose, although will bear much of that risk. Most interest rates on cap rates has the T-bill rates have held steady be- banks stress long-term rates during been muted. During two of the six low the early July levels. For rates underwriting, so a 100 basis point periods – from March 1978 to Sep- to continue higher, the impetus will move off historic lows should not tember 1981 and from June 2004 have to be from further improve- necessarily kill a project. If a deal to September 2006 – average cap ments in the overall economy. is that tight, it probably should not rates actually declined due to rap- have been done in the first place.” idly rising property values. In the If interest rates do rise because the intervening four periods of interest economy is becoming more robust, Concerns about re-financing aside, rate increases, cap rate growth was then all the components of a build- most lenders seem to feel that less than 50 basis points. In fact, ing’s pro forma – stronger absorp- the time for low rates has passed. the NCREIF forecast for the next tion, lower vacancy and higher Interest rates that move back to two years anticipates ten-year Trea- rents –will also improve, leading to historic – or at least recent – levels sury bond yields to climb towards higher net operating income. Even would make banks more comfort- five percent while cap rates go if cap rates rise initially with inter- able. from the current average of 6.1 to est rates, the improving NOI and 6.5 percent. values will hold cap rates in place. “The benchmark rate went off a cliff in the third and fourth quar- More relevant to the performance “Construction financing for new ter of 2011 and it went as low as of commercial real estate are the projects is generally funded with 150 basis points last year,” notes reasons behind any extended inter- short-term, floating rates, which Puntil. “The 10-year T-bill should est rate hikes. The 100 basis point have not been impacted yet and be at four. That’s where it will get spike that occurred from June to the Fed has given us visibility to within another year or so. The July resulted from the expectation through 2014,” says Sharp. “The consumer has become spoiled with that the Fed was going to encour- long-term financing rates tend to these rates. I hear about people age rising rates, which precipitated become an issue after construction looking more cautiously at buying a

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home at five and quarter percent. Really? These are still very low rates.”

“We are still in such a low rate Building relationships environment that even a couple of points upward isn’t going to We focus on developing and maintaining strong relationships put us in a bad place,” notes Griffith. “Perhaps it will even be with our customers. Working with you, project after project, has a more realistic place, as long made us the largest commercial real estate lender in the U.S. as you’re not dependent on ag- gressive rates for take out.”

Construction loans • Secured lines of credit • Repositioning/rehab lending Financing Speculatively Mini-perm loans • Interim/bridge loans • Term loans • Acquisition Interest rate swaps Few concepts were less viable for financing since the recession We’d like to build our relationship with you. than speculative commercial real Contact us today. estate. Although it was housing and speculative housing that Mark Monstwil were at the root of the financial [email protected] crisis, the declining economic fundamentals caused a steep increase in unemployment and a deleveraging of consumer debt that created big vacancies © 2013 Wells Fargo Bank, N.A. All rights reserved. MC-5426 in offices, retail centers and warehouses around the country. In high-growth markets like Las MC-5426_Developing_Pittsburgh_ad_4.75x4.75in.indd 1 2/6/13 11:24 AM Vegas, Phoenix, Central Florida and Southern California, where speculative development explod- ed in the mid-2000’s, there was pain for a lot of lenders.

There were markets where over- building didn’t occur and recovery began sooner than the balance of the country. By this time we know that Pittsburgh was one of those markets that didn’t see steep declines in commercial property values or high vacancy rates, even in retail centers. The problem for markets like Pitts- burgh is that finance is a global endeavor, so the pain that lenders felt about loans in Phoenix created reluctance to take risk in Pittsburgh.

Since the financial crisis, commercial real estate development has been limited to build-to-suit projects. Even as vacancy rates fell in metro Pittsburgh – leaving almost no contiguous vacant space in some submarkets – the appetite for spec development PLEASE CONTACT OR VISIT remained low until that latter Jason Stewart, Jones Lang LaSalle www.cranberrybusinesspark.com 412-208-1400 [email protected] www.property.jll.com/PIBP

20 DEVELOPINGPITTSBURGH | Fall 2013 f e a t u r e half of 2012 when some thawing finally occurred. For those projects that were able to secure financing there were some common de- nominators: good locations, strong financials and very strong sponsorship.

“I don’t think spec is the four- letter word it was five years ago,” says Chris Martin. “If you look at the office market right now, space is at a premium. If you’re talking about a great owner/developer/ operator, we really want that loan. I’m not talking about high-rise but if you a tenant has a track record of suc- “The loan-to-value are building a 50,000 to 100,000 cessful leasing,” he explains. “The square foot office building that’s a loan-to-value was certainly the big was certainly the big great product.” difference. We put more equity into the projects than we had usually difference. We put Elmhurst Group has developed done and that was okay with us more equity into the three speculative projects over the too. We didn’t really want to over- projects than we had past year or so, including a 90,000 leverage the building before it was square foot office in Cranberry cash-flowing.” usually done and that Township and two 48,000 square foot flex buildings in Thorn Hill The freeze on financing commercial was okay with us too. Industrial Park. real estate ended several years ago Elmhurst is also working on Schen- ley Place, a 110,000 square foot office building and 170-car garage in Oakland. Elmhurst’s CEO, Bill Hunt says but the thawing out that getting the was rather extend- deals done required ed, with terms and some changes in conditions that made the market condi- borrowing fairly un- tions and in his desirable. While all expectations about indicators were that the project. the Pittsburgh economy was growing very “You have to have early in the recovery a project location – say as early as third quarter of 2010 – the that, even without The spread between cap rates and the 10-year Treasury bond yields is greater than at any time in the last 30 years.

www.developingpittsburgh.com 21 f e a t u r e

lending environment wasn’t sup- pre-leased. It wasn’t long ago Corporate Center IV, Continental’s portive of development, even as that a good story meant little for North Shore Place, Continental/ vacancy rates fell and rents rose. a developer’s chances in securing Chaska’s Pittsburgh International Hunt is one of several Pittsburgh financing. For now it appears that Business Park and Landmark’s Du- developers who judged that the at least one good story, that of the tihl Road buildings; In the North market couldn’t wait any longer Pittsburgh market fundamentals, Hills, ACRES is building Stonewood for new product and was willing to Commons IV and Jendoco is devel- take what the market would give oping the smaller Sunset Building. him for the time being. “Our financing “It is important that the transaction be as flexible as possible so worked because Given the dynamics of the office when you do lease up you can refi- market in the region, especially nance at favorable terms,” he says. we have a good with the steady growth of users in “We understood we would have project and strong the Parkway West and I-79 cor- a lower rate of return on equity ridors, this new space could well for that period of time. And we sponsorship,” notes be absorbed by the time the last couldn’t do a project in a pioneer- Quattro partner Jim of the projects is completed. Even ing location. Banks aren’t going to if the projects take another year be pioneers.” Scalo. “[The lenders] or so to stabilize, it seems likely were looking for that the faith shown by the lenders In Southpointe II, Quattro Invest- will be rewarded. Assuming that ments is building a 150,000 multi- substantial net worth, global credit conditions continue to tenant spec office in tandem with substantial track moderate, at least until rates begin a new 186,000 square foot head- to rise in 2015, speculative devel- quarters office for ANYSY Inc. By record and a project opment should be easier to accom- positioning the project as a single in a good market, plish in the middle of the decade. project that was 55 percent pre- Whether the overall economy will leased, Quattro was able to get supported by a good encourage more development is an- financing but not without the per- other thing altogether but the cur- sonal sponsorship of the partners. study.” rent round of spec projects are like bread crumbs “Our financing worked pointing the because we have a way towards good project and more normal strong sponsorship,” conditions. notes Quattro partner Jim Scalo. “[The lend- Of course, ers] were looking for ‘normal’ is a substantial net worth, relative term. substantial track record For Jim No- and a project in a good land, normal market, supported by a shifts fre- good study.” quently.

“Great sponsorship “Twenty years is the key. Seasoned, ago the world well-capitalized devel- was a much opers who know the simpler place submarkets and have to figure out. the ability to enhance You didn’t credit are getting deals have Sep- done,” agrees Sharp. “But the debt goes a long way, assuming that tember 11 and wars around the markets still don’t have the liquid- the project’s sponsor has staying world,” he says. “Time frames for ity they did.” power. responding are getting shorter. All you can do is make your best guess Elmhurst and Quattro are two of a Roughly three-quarters of a million – and it is a guess – and if you’re total of at least eight projects that square feet of spec office space has right you make money.” have gotten under construction started. Among the larger buildings DP since late 2012, which are specula- are Millcraft’s Gardens at Mar- tive or have less than 50 percent ket Square, DiCicco’s Westpointe

22 DEVELOPINGPITTSBURGH | Fall 2013 Development Project

Rendering by Forum Studio. Source: Burns & Scalo Real Estate Services.

parks coming back to life he decided calls. “The growth came from other ANSYS/Zenith it was time to shift into a higher business sectors too. Mylan went gear again. from 100,000 to 250,000 square Ridge at feet. Ansys went from 100,000 to Burns & Scalo had joined with 180,000 square feet and Crown Southpointe II Charles Case to form Scalo Case Communications just moved into and developed nine buildings – Mylan’s old headquarters.” n business, as in roughly 700,000 square feet – in poker, success the first phase of Southpointe. Scalo found success working in often comes from The developer was selected as Southpointe in its early years and knowing when one of the master developers of feels the business model for South- to stand pat and Southpointe II, along with Horizon pointe was always very attractive when to be aggres- Properties, but had done no new to developers. sive. Real Iestate developers generally projects in the park by the time the don’t like standing on the sidelines. recession chilled development of “It really, truly is the best P3 part- Without doing more development, commercial real estate. During that nership that exists in a success- their businesses can’t grow. Between downturn, however, Scalo saw the ful model in the region,” he says. uncertain business conditions and a landscape shift at Southpointe. “Washington County put in the difficult financing environment, the roads and infrastructure, prepared past few years tested the patience “I was watching the park take off the park but they don’t compete of those who develop commercial again with the oil and gas industry. with the private sector for deals. real estate. So when Jim Scalo, CEO CONSOL was the catalyst but then You buy land for $125,000 an acre of Burns & Scalo Real Estate Services we saw others – like MarkWest and and get a five-year tax abatement. saw one of his favorite business Schlumberger – come in,” he re- That’s a great investment model.”

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BurnsScalo.com/Zenith | 412.250.3000 The exterior walls are laid out completely and cast on site with the brick and other exterior architectural features embedded in the poured concrete before the wall panel is lifted.

As the economic recovery took Responding to the request, Quattro 130,000 square feet ten years after hold, Burns & Scalo began to look was working a little ahead of the move-in with a notice in eight-and- at the opportunities in South- game because they had already put half years.” pointe. In September 2011, the together a design, albeit for a dif- company acquired Charles Case’s ferent concept, and were market- Once Quattro’s proposal was suc- stake in the partnership and pur- ing the project’s location and site cessful, Scalo had the opportunity sued development in the park more advantages. Given the opportunity to execute an approach that he had aggressively. They discovered that a to change the program and work been kicking around for a while. parcel that was held off the market with an anchor office user, Quattro On a trip to the Midwest, Scalo had in anticipation of being the Wash- focused on a unifying concept for seen an approach used that he felt ington County Convention Center multiple buildings along the ridge was not being utilized in Western site had become quietly available of the hill. That created a campus PA, one that would solve a couple again. The land, situated at the top feel that made the difference. The of the problems he felt were inher- of Horizon Vue Drive, offers the RFP was in June of 2012 and AN- ent in the traditional construction highest sight lines in Southpointe process when he hired an architect II and is visible from Interstate 79. and general contractor. He commit- Burns & Scalo and partners Charles ted to doing the ANSYS project as Zappala and John Verbanac put The land, situated at a design/build delivery. the land under option. In Febru- the top of Horizon ary 2012, the partnership – le- “We knew we were going the gally known as Quattro Investment Vue Drive, offers the general contractor route because Group LP – announced plans to de- highest sight lines of the size of the project and the velop the property by building two bonding requirements of the lend- 100,000 square foot offices. Within in Southpointe II ers,” he says. “The problem with a few months, an opportunity arose and is visible from the traditional approach is cost that would expand the scope of the overruns. Cost overruns come from project significantly. Interstate 79. two areas: poor drawings and owner changes. We can control owner Product simulation software com- changes but not poor drawings.” pany ANSYS Inc. had outgrown SYS took a couple of months or so its headquarters and wanted to to decide (“It took a while. These Scalo’s interest in doing what he expand and consolidate opera- big deals take time,” Scalo says). In calls “true design/build” was in tions from other locations into a September 2012, ANSYS agreed to having one party responsible for new office building. ANSYS issued lease the building and the project both the design and construction. a request for proposals to devel- was off and running. One weakness of the design-bid- opers in June of 2012. Scalo/Case build process is that it relies on the had developed the existing ANSYS “We had a relationship with ANSYS interpretation of the owner’s intent headquarters on Technology Drive but what they really liked about by two separate entities – archi- in Southpointe and Quattro was the proposal was that we were tect and general contractor – that invited to submit a proposal for the building a campus,” recalls Scalo. are not contractually obligated to new facility, which would be nearly “Their building will be 186,000 each other. Unless there is perfect, double the size of that first head- square feet but they have the op- almost extrasensory communication quarters. tion of a second building of up to between owner and architect, there

www.developingpittsburgh.com 25 “The RFP asked for design, price and schedule. It had a GMP [guaranteed maximum price] essentially,” recalls Clayco’s senior vice president and partner Kirk Warden. “When we turned in the initial design we had a price guaranteed with it. I think we had both the design concept and the right price all along. The fact is that we do this sort of thing all the time.”

Throughout the first weeks of 2013, the contractors in the running were asked to supply additional iterations of the design with revised pricing. In mid-January, the developer selected Clayco as their design/builder for the ANSYS campus. While their design and price met Quattro’s demands for the project, Jim Scalo says they had an edge in the intangibles as well.

“Clayco had good developer experience,” he notes. “Some general contractors don’t work well with developers. We’re not easy to work with. We watch our costs. We work within our pro forma very closely and don’t like when things vary from that.

Warden says that Clayco’s model helps them be more sympathetic to developers, possibly because the issues a developer faces aren’t all that unique. “Owners always have constraints, whether it’s budgets, schedules, constructability or whatever and both sides have to keep those constraints and requirements Rendering by Forum Studio. Source: in mind so everyone can make bet- Burns & Scalo Real Estate Services. ter decisions all along,” he says. “You make better decisions when all parties are at the table at the same time.” will be occasions for disagree- was Clayco Construction from St. ments about scope or intent. Most Louis. A Burns & Scalo manager Getting the design/build firm on times, those disagreements lead had previously worked with Clayco board was a significant milestone to additional costs to resolve. In a and one of the projects Jim Scalo for the project but there still re- design/build model, only one party had observed in Indianapolis was mained the tasks of completing a interprets what the client wants. a Clayco job. When the RFP was design that met the budget and If that party misunderstands or issued, there were nine firms asked working through the financing for mis-communicates, the onus is on to compete. the project. the design/builder instead of the owner. The review process was very thor- The first of those tasks wasn’t go- ough, with an RFP that requested ing to be easy. Both Quattro and As the holidays approached, Quat- an unusual level of detail consider- Clayco were interested in doing a tro assembled a list of contrac- ing the shortage of detailed draw- building that was architecturally tors that were design/build expe- ings, a process Scalo called “soft distinctive but the pro forma was rienced. The list had both local design, hard bid.” built on an average $24/square and national firms, one of which foot rent for 15 years. Any design

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www.washcochamber.com Rendering by Forum Studio. Source: Burns & Scalo Real Estate Services.

choices would ultimately have to months that it would usually take,” meet the test of that practical The final design is a notes Scott Caplan, Clayco’s direc- standard. According to Warden, tor of business development in there wasn’t much time wasted very geometrically- Pittsburgh. “What that means to getting after that task. a developer is four-to-six months informed brick and less general conditions, four-to- “Once we were selected there aluminum curtain six months less winter conditions was a lot of re-pricing with a lot and more importantly, four-to-six of alternates for the design. We wall exterior, five months less construction interest.” probably provided seven or eight stories with several different versions,” he recalls. One The structure will be poured and of Clayco’s divisions is the archi- colors of brick and lifted by Concrete Strategies Inc., tectural firm Forum Studios. The aluminum windows a concrete subcontracting division team had in mind a design that of Clayco’s. Proving that everyone isn’t commonly used in Western with colored trim. in the world is just two degrees PA. “We had been in Pittsburgh a separated from Pittsburgh, the lot and saw the kinds of corporate president of Concrete Strategies is office buildings that existed. [The rior will be architectural structural Joe Vitale, father of the Penguins architects] felt that the Pittsburgh concrete cast on site. Site cast con- center of the same name. market was lagging behind some crete structures have been built be- of the newer ideas that are before in Western PA – although not Quattro Investment Group took a ing used in other cities around the many – but none that casts a five- similar approach to financing the country.” story exterior wall with brick inlaid project as it did to contracting, and lifted as one entire elevation. looking both within the region and The final design is a very geometri- The structure has a greater thermal across the country for options. cally-informed brick and aluminum mass than conventional steel and “We did a national search for debt, curtain wall exterior, five stories cavity wall construction and gives equity and presale and we con- with several colors of brick and unlimited flexibility to the interiors cluded our best option was to self- aluminum windows with colored because there are no columns. The perform,” says Scalo. “We looked trim. The building’s exterior gets process also shaves critical time off at what was our best model, our texture from the change in materi- the schedule. best gain and that was to self- als and the shapes that the mate- “We’re able to deliver a core and perform. We put in our own equity rials take. What is very different shell for Class A office in eight of ten percent, which has to go in about the building is that this exte- months instead of the 12 to 14 up front.”

28 DEVELOPINGPITTSBURGH | Fall 2013 We’re always On call 24/7 — 412.921.4030 60 Years of Trusted relationships and Proven experience

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a full-service civil engineering firm www.gatewayengineers.com Rendering by Forum Studio. Source: Burns & Scalo Real Estate Services.

Scalo says he approached it as and his partners one project that felt there were PROJECT TEAM was more than three risks asso- Quattro Investment Group LP...... Developer half pre-leased.” ciated with the project and they Clayco Construction Co...... Design/build Contractor That was how were comfort- Forum Studio...... Architect a team of lo- able with their cal banks ap- plan for manag- Burns & Scalo Real Estate Services...... Leasing Broker proached the ing them. Gateway Engineers...... Civil Engineer project as well.

“There is the WesBanco Bank...... Co-Lender “Even though development First National Bank...... Co-Lender there was a spec risk. We felt we building, we could control First Commonwealth Bank...... Co-Lender looked at it as the construction one project,” and costs. We says WesBanco understood the Having a build-to-suit client on senior vice presi- interest rate risk over the next two more than half of the project dent John Fetsko. “With the ANSYS years, which is important because reduced the speculative aspect of deal the project was something like the loan has a floating rate. And the development but Quattro was 55 percent pre-leased.” there is a leasing risk but we feel still looking at finding a lender for we understand this market well a 150,000 square foot spec, which First National Bank’s Bob Pow- enough to take that risk,” he ex- is not a product that lenders have derly says his bank saw the deal plains. The latter risk applies to the been lining up for in recent years. the same way and was willing to second building under construc- look at the project because of the tion, a 150,000 square foot specu- “Spec financing generally isn’t participating lenders. “On larger lative building. Scalo’s comfort available still. Banks just can’t projects, banks have to team up. with the leasing seems justified, do it because of the regulations. On ANSYS, no one was willing as the company is working two Institutional lenders – investors, to take on the risk of the entire requests for proposals for large life insurance companies – they project,” he says. “So we linked up portions of the second building. aren’t interested, even if they say with WesBanco and First Common- they are,” observes Scalo. “We wealth. They are similar banks with

30 DEVELOPINGPITTSBURGH | Fall 2013 similar credit approaches.” The three banks participated equally, taking a third of the $60 million-plus loan.

“We got an amazing debt proposal. The banks were very competitive,” says Scalo. “There is one mortgage Manage Facilities & Operations Cost with two notes, 100 percent person- ally guaranteed. We got a three-year Reduce Energy Costs construction loan and three-year mini-perm, which we always like to Improve Operating Performance do. That gives us the flexibility to go Lower Maintenance Cost to a permanent loan, test the capital Extend Asset Life markets or sell the building.” Services Include: Work started on the project in late June. Clayco is in the process of preparing the casting pads for pour- Energy Audits Project Management ing the exterior walls in late summer. Maintenance Planning and Budgeting Indoor Air Quality Assessments The major subcontractors have been Building Forensics & Engineering Remediation Support Services lined up and construction is off to a Environmental Site Assessments Capital Needs Assessments smooth start, according to Kirk War- den.

“There haven’t been any big chal- For Nationwide Service Call: lenges, other than educating everyone 412-651-9333 about the whole design/build process Or Email and architectural site cast concrete,” [email protected] says Warden. “The project has gone Web: www.rrcconsulting.com pretty well, even the subcontractor market, which can be difficult, went very well. The project is over 75 percent bid out.”

Occupancy on the ANSYS building is set for October 1, 2014. Construc- tion on the second building is running parallel to ANSYS. The development has been branded as Zenith Ridge – “You know we love to name our projects,” says Scalo – although everyone continues to refer to it as the ANSYS campus. The Zenith Ridge plan includes a third building, which is being marketed as a 150,000 square foot corporate headquarters. Given the tight Southpointe market and the continued high interest in the properties there, don’t be surprised to see construction on that building get underway ahead of schedule. DP

www.developingpittsburgh.com 31 Developer Profile

Aloe Coal were shifted to Imperial was relatively flat, workable land Imperial Land Land, which then leased it to Aloe that was ready for a new purpose. Coal. The coal business then paid Corporation a royalty to Imperial Land, which “It’s basically been a reclamation also purchased additional lands for project,” says Gerald Bunda, Impe- atience in the mining. The properties included rial’s president. “The reclamation business world roughly 3,000 acres in western did well for Potato Garden Run is often talked Allegheny County along Potato and the tributaries that drain this about and Garden Run Road and 2,000 acres area so it was an environmental seldom applied by Quicksilver Road in Washington benefit but it was also a long-term as diligently as County. The properties were both economic benefit because the land the ownersP of Imperial Land Cor- close to Route 22 and to Burgett- can be used for another use. That’s poration have. With a bit of vision stown Road. called re-mining.” and admittedly limited exposure to risk by waiting, Imperial Land has In the late 1970’s early 1980’s the Jerry Bunda came on board in 1991 seen the market come to them over properties were heavily mined and as the first employee of Imperial the course of a generation. the coal workings were removed. Land. His job was to help do the New technologies had been devel- things necessary to make the prop- Imperial was founded in 1973 by oped to eliminate all the voids and erty more suitable for development William and Arthur Aloe as the the acid mine drainage stopped for its next useful life, like improv- land purchasing arm of the Aloe because the source of the drainage ing the access, bringing water, Coal Co. The land holdings under had been removed. What remained sewers and utilities to the property.

32 DEVELOPINGPITTSBURGH | Fall 2013 “Our job here is Getting infrastructure worked out realized that in order to sell the took more than just a few years. to prepare the land they had to fully develop the land for another property. Bunda’s formal education was in community development and beneficial use. When Construction began on Findlay regional planning. He worked for I took officials Industrial Park in 2008, hardly the the Allegheny County Redevelop- best time to start a new project but ment Authority for few years back out here and we they were able to sell the first two in 1970’s and then was assistant stood on the hill lots to Appliance Dealers Coopera- manager for Moon Township from tive and to Okonite for construc- 1984 to 1991. During that time he I would say here’s tion in early 2009. also served as director of the Moon the new frontier Transportation Authority, which “They were the pioneers. I use that promoted and oversaw the new - in Allegheny term because they were the first interchanges in the municipality. County – but you ones out there so the rate per acre That experience led to relationships was very reasonable to get the mo- that would prove invaluable over can’t get out here mentum going,” says Bunda “Then the years, as Imperial Land sought we sold the land to Alro Steel. to expedite the processes of state and you couldn’t We’ve had a year lull but that was and municipal government. until the road was to get phase two going. Phase two is now done and the sites are “My background was more govern- completed,” recalls pretty good lots. I won’t say all the mental but I had some development Bunda. lots are pad-ready but most are and experience because that era was we’re ready for the next projects.” a big period of growth in Moon Township,” Bunda says. “That’s the he knew that many of the people “Our job here is to prepare the connection between the two. The employed at Findlay Industrial Park land for another beneficial use. Aloe’s became aware of me through would live in Beaver County. When I took officials out here and the development work in Moon.” we stood on the hill I would say “It’s been quite a challenge. It here’s the new frontier - in Al- That process of getting the utili- was a new frontier for Allegheny legheny County – but you can’t ties extended and the highway County and for Washington County get out here and you couldn’t until completed was no small task and to the south,” notes Bunda. “For the road was completed,” recalls took the better part of 15 years to this property we had to bring ev- Bunda. “That goes to the need for accomplish. There was a gap of a erything out here. The water, sewer improved transportation. There’s couple miles between the existing and gas all had to be run out to land out there, land close to im- water and sewer system, which ran this area and it took a while. We portant assets like the airport that along Potato Garden Run Road and had the road coming in but it then doesn’t have access to highways,” the Findlay Industrial Park proper- took a couple of years to get pre- he continues. “I will say this, none ties. Bunda found himself making pared for development.” of the people that have moved here the case for the public investment are in the gas business. They chose to catalyze private development The road Bunda speaks of is the to be here because of access. They to many levels of government and airport leg of the Findlay Connec- can jump right on a highway. Alro politicians. Imperial Land donated tor, the portion of I-576 that runs is from Michigan and they can get the right-of-way for the Find- between Pittsburgh International right on an interstate and connect lay Connector and was willing to Airport and Route 22 near Star- to there. The Interstate 79 con- guarantee some of the debt taken pointe in Washington County. The nection to the Parkway is going to on by the municipal authorities. He highway was done in 2006 and help the whole region because now says that the experience put him in first construction was in 2008. you can go west without going front of some of the most power- When Imperial Land took their first around. The people that are look- ful leaders in Pennsylvania and also prospects to the site they only had ing at us are looking at the trans- political characters like Mike Veon a “brush hog road” and had to portation and if we can enhance it and Bill DeWeese. Veon success- visualize the property after devel- with a 22 to 79 link that makes it fully pushed for grants and loans opment. Imperial Land’s original even better.” that got the park going because idea was to sell bulk land but they

www.developingpittsburgh.com 33 While the Findlay Industrial Park and horizon for its decision-making and its neighboring Westport Woods return expectations. Bunda credits have been the focus of Imperial that mind-set for staying the course Land’s efforts, the ownership of on a development project that was the business still has diverse assets almost two decades in the making. beyond commercial real estate. They “The patience came from our board also own the property used as a of directors because they knew that landfill by Allied Waste and oper- it takes a long time for a highway to ate a sister company, called Landfill get built. It takes about 12 years for Gas that gathers the methane that a highway to get completed,” says is emitted at the landfill. The Aloe’s Bunda. “We saw that the right-of- operate a coal company in West Vir- way was moving forward and the ginia and now have Marcellus shale funding was up and down but what gas wells on their Quicksilver prop- we tried to do was get other things erty. There are 5,000 acres under Im- Imperial Land’s president Jerry prepared and had other assets to perial Land and another 2,000 acres Bunda, who is president-elect of work on. My board kept preaching held separately under Aloe Family NAIOP Pittsburgh and a member of patience because they believed [the Limited Partnership that comprises the chapter’s Executive Committee. infrastructure] would eventually get a total of 7,000 acres on which they here. Now that’s occurred.” are trying to create a new economic benefit. One big advantage is that Currently they include Tony Liberati Although the Aloe family has been Imperial Land didn’t go out and buy from the DeBartolo Organization, patient and invested with a long the land. Because the land had been Bob Brand who has experience in range expectation on returns, acquired years ago for coal purposes family-owned businesses and Bob they have maintained a conserva- then the carrying costs of the land Stephenson, who was the former tive fiscal profile for Imperial Land weren’t there. head of the RIDC. Co. Until 2006, Bunda had been the only employee. He and Brian Imperial Land Corp. is managed by a Like most businesses based on land Temple are the full-time staff of the board of directors, four family mem- or other long-term assets, Imperial company, which contracts out or bers and three outside members. Land has had a significantly longer shares administrative and financial

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34 DEVELOPINGPITTSBURGH | Fall 2013 resources with other Aloe busi- be rather than saying here’s where on right now. We’re moving along nesses. I’ll build you the road.” smoothly and steadily, but that’s the Pittsburgh way isn’t it?” In the year or two that followed Bunda relates that interest from the successes with Appliance Deal- prospects is notably higher. In late ers, Okonite and Alro Steel the July, the company saw one of those Imperial Land Corp. economic recovery seemed to take prospects bear fruit, when Gor- one step forward and two steps don Food Services announced that is managed by a back. Bunda says that a number of they would be building a 420,000 prospects kicked the tires but no square foot distribution center at board of directors, deals were done. Because Impe- Findlay Industrial Park. With the four family members rial Land’s business plan doesn’t 83-acre Westport Woods in final include any vertical construction design and construction scheduled and three outside there was no thought of develop- to start in 2014, Imperial Land members. ing a spec building. Instead the Corp. has probably moved beyond company used the time to complete the stage of preparing to develop. planning of its Westport Woods Imperial Land Corporation project and continued site prepara- “Once you have some success I 1009 Beaver Grade Road, Suite 210 tion to make the Findlay Industrial think people realize what can be Moon Township, PA 15108 Park lots more marketable. done. We were going to do some- T: 412-446-0670 thing with that land anyway,” Jerry Bunda “One thing our board always said notes Bunda. “We have 5,000 acres President was that we have to have inven- and the next leg of the highway Imperial Land Corporation tory,” Bunda explains. “As of the will run through the Quicksilver www.imperialland.com end of last year we have inventory property. I’m sure there will be de- DP and I hope that helps. It’s a whole cisions to make about development lot better to have people ride down in the future but we have work to a road and say here’s where you’ll do with the property we’re working

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sources for mass transit have virtually disappeared and aren’t coming back soon.

“The real idea is that Oakland is the center of innovation and entre- preneurship in the whole Pittsburgh region. Companies want to be in Oakland to get the energy and innovation but there is little devel- opable land,” says Ken Zapinski, senior vice president, energy and infrastructure for the Allegheny Conference. “How do you do it? Make Oakland bigger by making it seamless to get between there and Downtown.”

While there is an argument to be made that the two economic hubs are growing together without such a transit system – there are barely ten blocks separating the projects at the leading edges of each submarket – Pittsburgh’s regional business and civic leaders are anxious and residential real estate develop- to create a catalyst to accelerate ment has also grown organically the inevitable. It is looking increas- as private developers and property ingly more likely that the solution Bus Rapid owners placed bets on the revital- will be a bus rapid transit system. ized Uptown or Lower Hill District Transit following the completion of the Pittsburgh Regional Alliance and CONSOL Energy Center. Chamber of Commerce president ne of the DeWitt Peart probably speaks for evolving All of this activity has occurred most development advocates when economic without the support of a dedicated he talks about the creation of a bus stories of mass transit connection between rapid transit (BRT) solution. the past the CBD and Oakland. Creating several a link between these two main “We have got to do something. years is theO connection between economic centers has thus far What that something will be is a the Central Business District (CBD) been both a regional imperative bigger issue but we can’t keep go- and Oakland. UPMC’s decision to and a practical impossibility. The ing like we are,” Peart asserts. gradually relocate nearly one mil- traditional solution is a light rail lion square feet of administrative connection but executing such an Like most observers, Peart might space from its hospital campuses infrastructure project has several prefer that a viable alternative to 600 Grant Street was the cata- significant obstacles, the most existed in light rail. Most urban lyst for the activity but commercial salient of which is that the funding planning and development studies

www.developingpittsburgh.com 37 Dedicated BRT buses, like this one in Las Vegas, advocate using light rail for mass between Oakland and Downtown resemble rail vehicles. transit systems. Such systems are were to take, a large number of what communities and the com- East End commuters would need to muting public wants. Moreover, as ride buses and transfer to the new anchors for private transit-orient- system in Oakland. That means that ed development, light rail systems a Downtown-Oakland LRT con- are attractive because of their nection wouldn’t relieve PAT’s bus permanence. Light rail requires ridership beyond Oakland and the stations and stations become loca- cost would be difficult to justify. tions through which thousands of consumers pass each day. “We have been studying this problem for a long time,” explains The man responsible for support- Allegheny County executive Rich ing the solution to the transit Fitzgerald. “At first we wanted issue at the Allegheny Conference light rail but it became very evident says that light rail isn’t necessar- that it would cost about two billion ily the right solution for linking dollars and we didn’t know where Oakland to Downtown. Aside from the money would come from. Sec- obvious cost and topographical ondly, we realized it would take 15 issues, Ken Zapinski points out years to build.” that the Port Authority’s heaviest traveled routes for the existing bus Fitzgerald noted that the full cycle system are to the eastern neigh- for the North Shore Connector took borhoods and suburbs, most of that long from planning to opening which lie beyond Oakland. A light and that during that time the fed- rail transit system (LRT) to Oakland eral government reduced its match wouldn’t serve those commuters from 80 percent of the project or relieve any burden on the exist- to 50 percent, meaning the local ing system. Regardless of what authorities would need to find one form the rapid transit connection billion dollars. For a county and

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38 DEVELOPINGPITTSBURGH | Fall 2013 Port Authority already straining to in place, most or all of those routes regain fiscal footing, such a cost is could be eliminated, which means practically unattainable. Stakeholders in a that the BRT’s operating costs would not exceed the current costs. “The other thing about rail is that BRT system have Just as important to its advocates we’ve been studying it for about begun evaluating is the fact that the BRT could be 20 years and never had any con- operational in three or four years sensus about how to do it,” ob- the operating from today. And while the cost of a serves Wendy Stern, PAT’s assistant alternatives and completed BRT system is estimated general manager for planning. at $200 million – or one-tenth “The advantage of bus – particu- are marketing the the cost of rail – the system could larly this form – is that it provides BRT concept. develop in phases that would still a rail-like experience in the most accomplish some of the project’s cost-effective manner goals for transit and devel- and can develop incre- opment. mentally as resources become available. It Stakeholders in a BRT sys- can also be integrated tem have begun evaluating into the existing transit the operating alternatives system, making it work and are marketing the BRT more efficiently.” concept. While the Port Authority is the logical Stern explains that the conduit for communication Oakland-to-CBD trip and contracting, there are currently has eight forty groups involved in the routes running between project, including Sustain- those two locations and able Pittsburgh, the city, another ten routes that county, Allegheny Confer- are related. When a ence, universities, hospitals functional BRT system is and business leaders, like

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www.developingpittsburgh.com 39 As far as the first goal is concerned, a transit solution will have to offer comfortable and clean vehicles but the main problems are associated with travel time and reliability. The PAT bus routes that exist have a frequency of 2.5 minutes but the actual frequency is often eight minutes or more. Be- cause of the heavy traffic in Oak- land throughout different times of the day and year, travel times are quite variable.

Wendy Stern explains that the operating alternatives have already been whittled down from ten to two that use Fifth and Forbes Avenues to create dedicated lanes. “One is to operate away from Downtown along Forbes – that Photo courtesy Cleveland Regional "One of NAIOP's lane is already heavily used by Transit Authority. bus – and to come from Oakland top goals in our on Fifth Avenue using the curb advocacy efforts has bus lane,” says Stern. “The second [alternative] has both lanes operat- been to 'have a seat ing along Fifth Avenue. It uses the NAIOP Pittsburgh. The County at the table' on key current bus lane going opposite the Executive formalized the effort by direction of traffic and a second forming the Transportation Action issues impacting lane on the other side going with Partnership. The stakeholders are the flow of traffic.” among 30 community-based groups our industr y,” says that have started Get There PGH Lynn DeLorenzo, of The Parsons Brinckerhoff study will to explore the impacts of a BRT define the alternatives in detail and system, using the gettherePGH.org TarquinCoRE and past offer recommendations for stations, website to connect with commuters president of NAIOP infrastructure improvements, traffic and businesses. light and control systems and cost Pittsburgh. estimates. It should be available "One of NAIOP's top goals in our in the fall for the stakeholders to advocacy efforts has been to 'have review but Stern says the release a seat at the table' on key issues sit. Engineers Parsons Brinckerhoff are currently wrapping up a study of the study may be delayed until impacting our industry,” says Lynn the environmental impact studies DeLorenzo, of TarquinCoRE and to identify the alternatives and objectives of the BRT system. are done in the winter of 2014 to past president of NAIOP Pitts- satisfy the federal requirements for burgh. “As the BRT connection According to Stern, there are two funding. Should that go smoothly, between Oakland and the CBD is the Pittsburgh BRT project would of high importance to our organi- main goals any transit solution must meet. need the Federal Transportation zation, we have been fortunate to Authority’s approval to get in the have a seat on the Stakeholders queue for funding – with no guar- Committee. In this regard, we have “First is improving the quality of transit experience. We already have antee – to finish the planning and input into the future route, sta- design. Should the project get green tions and potential of surrounding this highly utilized corridor that makes up 30 percent of our total lights all along – and assemble the transit oriented development sites funding – construction of the BRT around the stations." ridership. That’s pretty significant,” she says. “The second goal is to could begin in 2015, with pas- catalyze new development. From sengers boarding the first buses in In April, the collaborative planning 2017. effort received a boost when the January 2006 until December 2012 Rockefeller Foundation awarded a the total investment in Downtown exceeded $5 billion. That’s a lot of For an idea of how such a BRT sys- $1.2 million grant to support the tem might work, stakeholders don’t planning of the system. Pittsburgh development but if you look at how many opportunities there would have to merely rely on study and was one of four cities chosen by theory; there is a real life system Rockefeller – along with Nashville, be in Uptown there is even more potential.” operating for nearly five years in Boston and Chicago – to help with Cleveland. Dubbed the HealthLine the development of bus rapid tran- because it connects Cleveland’s

40 DEVELOPINGPITTSBURGH | Fall 2013 downtown to its hospital district, the BRT traverses nine miles along Euclid Avenue. As the city’s ‘Main Street’, Euclid Avenue had seen decline as Cleveland’s fortunes sagged over the Driving innovation in Pittsburgh’s past decade. After the BRT commenced commercial real estate solutions and services operations in 2008, the trip shortened the commute between the end points of the system from 45 to 30 minutes and began to entice private investment along the route. Businesses gained confidence in the permanence of the BRT stations. Crime and drug traffic receded into other areas as ridership on the BRT took off, nearly doubling that of the predecessor bus routes.

Euclid Avenue will not be compared to Chicago’s ‘Miracle Mile’ just yet – or even Pittsburgh’s Penn Avenue – but the decline has been reversed and in- Partnership. Performance. vestment is on the rise. Avison Young’s integrated team approach to County Executive Fitzgerald is one of commercial real estate engages deep expertise from a those leading the charge for a BRT broad range of professionals across our organization. system precisely because he’s seen the In a partnership focused on your strategic business 20 Stanwix Street Suite 401 ripple effect that the HealthLine has objectives, we deliver intelligent, best-in-class solutions Pittsburgh, PA 15222 had in Cleveland. He led a delegation that add value and build competitive advantage for www.avisonyoung.com of more than 40 people to Cleveland your enterprise. on June 20 to view the system, which had more than 4.6 million riders in 2012.

“I saw it three years ago but it really opened up my eyes when we went again in June. When they built their BRT it linked those two communities but it spurred a lot of development in an area that was blighted and dilapi- dated,” he says. “What impressed me was the tremendous increase in property values along Euclid. I could see that happening along Fifth and Forbes. The other thing is that it took all the other buses off the road [on Euclid]. LANDAU BUILDING COMPANY Think about all the buses currently go- HEALTHCARE ing through Oakland on Fifth Avenue.”

That related development is what EDUCATION Zapinski views as the payoff for the BRT. “It’s not a transit project but a COMMUNITY community revitalization, economic and real estate development project,” COMMERCIAL he says. “We need to understand from the development community what level of transportation project would be needed to signal commitment. We need to hear what developers want because if we get the BRT and it does not stimulate economic revitalization, it cannot be deemed a success. We don’t want people coming back after- wards telling us that we should have thought of something else.” Building Trust for Over 100 Years DP

www.developingpittsburgh.com 41 Eye on the Economy

he summer the data shows the U. S. economy cent said they expected to hire new of 2013 is barely growing as rapidly as infla- employees this year. July’s report the first since tion. Dampened demand for manu- was the third consecutive quarter 2009 to have factured goods, continued declines of positive outlook and the most no economic in all government spending and positive results since the recession. shock to a surprising slowdown in housing short-circuitT a springtime recov- starts in June fairly assures that the The key underpinning of the ery, although that fact shouldn’t economy grew at one percent or economic foundation – consumer suggest that a robust recovery less during the first six months. spending – has shown renewed is underway or even on the way strength after a slump of 0.3 per- soon. What has been revealed since Employment growth, on the other cent in April following the increase spring is that the U. S. economy hand, continued the trend upward in Social Security contributions is doing better than expected in a in June, with 195,000 jobs added. that accompanied the ‘sequester.’ number of key metrics, while fall- The June research also revealed Personal income has risen 0.3 to ing behind on the most common that previous estimates of job 0.4 percent monthly, while the sav- measure of economic growth. It growth for April and May were ings rate continues to rise. As the has also become clear that Ameri- understated by 70,000 jobs. Those impact of the increased taxes fades can economic growth is being held revisions pushed the six-month av- and the improvement in home val- back by the continued weak global erage above 200,000 jobs monthly. ues expands, consumer confidence marketplace more than by domestic That’s a figure that exceeds the and spending should improve. July’s troubles, although reduced govern- equilibrium for job creation by spending increase of 1.8 percent ment spending is muting expan- one-third, a pace that will support thus far validates that theory. sion. Perhaps most important of growth and add to the demand for all measures, employment growth space. Also encouraging was the Consumers are also seeing bet- has continued to trend upward at a declining unemployment rate of 7.4 ter than expected wage increases. pace that is both unspectacular and percent, which fell even with the July’s numbers showed a 3.4 per- better than forecasted. increase in those looking for jobs. cent increase in inflation-adjusted income, while personal savings During the past few business cycles The most encouraging trend in the increased to 4.5 percent of income. U. S. companies have steadily employment picture is the fact that grown their share of the global the steady growth has been in tan- Taken as a whole, the improving marketplace, with exports making dem with a steady decline in public economic picture has emboldened up a significant portion of their employment. Although the magni- the Federal Reserve Bank to make total sales. The declining growth tude of government job cuts has plans for scaling back its bond buy- in China, India and other emerging not been great, the decline means ing program. That’s a prospect that markets – in combination with the that private sector employment has has spooked investors and heart- deep recession in Europe – have re- been that much stronger than the ened business people at the same duced the size of the pie for which overall job market. time. Improving conditions and the American companies can compete. prospect of an end to quantitative This global decline has impacted According to the July 23 Price- easing have also resulted in the U. S. gross domestic product (GDP) waterhouseCoopers' U.S. Private first significant rise in interest rates as well. Company Trendsetter Barometer, since the onset of the financial private sector employers are dis- crisis. Estimating GDP has become a playing increasing optimism. The more difficult assignment in the quarterly survey tracks the mind- Rising short-term and long-term past year. After initial estimates of set and business practices of 202 interest rates present a potential contraction in the fourth quarter of CEO’s and CFO’s from privately held problem for the recovery in com- 2012 and almost no growth from U.S.-based companies. Among the mercial real estate and for the sud- January to April 2013, real GDP key findings in the second quarter denly robust housing market. Sig- growth was actually 1.1 percent in were: 80 percent of the executives nificant increases in rates increase both quarters. Economists expected were forecasting growth over the the cost of capital for acquisition the second quarter growth to be coming year, with one-third expect- and development. At the consumer barely positive, somewhere being double-digit growth; two-thirds level, higher rates decrease the af- tween 0.2 and 0.4 percent. While predicted higher GDP growth than fordability of homes, which could the initial report of July 31 showed the government’s estimates, with put downward pressure on home a surprising jump of 1.7 percent, an average of 2.2 percent; 57 per- prices that have begun a cycle of

42 DEVELOPINGPITTSBURGH | Fall 2013 appreciation over the past six quar- past few years are receding. While re-balancing, that segment of the ters. These higher costs of borrow- reduced government spending will real estate market is again robust. ing have the potential for dampen- continue to be a drag on space Beyond the positive employment ing value growth on all categories demand from those serving the impact that would attend a boom of real estate but a look at the state and federal government, the in home construction, the signifi- performance of real estate during growing employment base should cant rise in home values will have past periods of rising rates reveals continue to push occupancy levels a salutary effect on the consumer’s that concerns about increases may higher. New construction additions mentality. The U. S. economy ap- be overblown. to inventory remain behind the de- pears to be on firm footing once mand for space from growth, even more. In all six periods of rising rates go- in the hot multi-family category. ing back to March 1978, upward Across the other commercial prop- It’s also clear that overseas mar- pressures on property prices more erty types, the extended low levels kets still have much further to go than offset the impact of higher of construction will keep supply to reach the same level of recovery interest, which could have pushed below the levels of the pent-up that the U. S. is experiencing. With cap rates higher. It is expected demand. exports making up more than 14 that any winding down of the Fed’s percent of GDP, expansion of the bond buying will be accompanied Consumer and business confidence magnitude seen during the previ- by improved economic fundamen- remains somewhat lower than the ous growth cycles won’t occur until tals that will boost occupancy and pre-recession levels but there is growth returns globally. rents, which will boost the income much evidence that the damage DP from the property as well. done by the financial crisis has healed. At the root of the financial For commercial real estate many meltdown was the overheated U. S. of the bigger concerns from the housing market. After five years of

www.developingpittsburgh.com 43 Office Market Update

tiguous blocks of Class A space in Downs, signed a long-term lease PITTSBURGH the region are located in the CBD, for 46,546 square feet at One PPG but all are marred by challenging Place, also in the CBD. Though leas- OFFICE circumstances – 146,070 square ing activity from the same period feet at the U. S. Steel Tower, not in 2012 to 2013 dropped by nearly MARKET available until early 2014; and 52%, numerous new build-to-suit 131,600 square feet at the Union projects for major tenants are in de- OVERVIEW – Trust Building, which currently is in velopment throughout the market. receivership. At present, there are Mylan Pharmaceuticals and Ansys, MID-YEAR 2013 no contiguous Class A spaces larger Inc. are constructing new headquar- than 90,000 square feet available ters in Southpointe, consisting of in the suburban markets. 280,000 square feet and 186,000 square feet respectively, while Economic Overview ServiceLink is constructing a new 106,000-sf facility at Pittsburgh n the first half The largest International Business Park and of 2013, there contiguous blocks PNC continues construction on its were more people 800,000-sf The Tower at PNC Plaza, working in Pitts- of Class A space where it will relocate employees burgh than ever in the region are from a number of other locations before, according throughout the CBD. to the AlleghenyI Conference on located in the CBD, Economic Development, who re- The University of Pittsburgh Medi- ported that 269 separate economic but all are marred cal Center (UPMC) led absorption development projects that could by challenging in early 2013 as it began to fill generate as many as 8,300 new eight additional floors at the U. jobs for the region were in process circumstances – S. Steel Tower, adding to the 15 it as of February 2013. The region 146,070 square feet already occupies there. Additional has seen five consecutive years of space will be made available in the continuous expansion and a current at the U. S. Steel Steel Tower when PNC completes capital investment of $3.2 billion. Tower, not available renovations on the former Lord & Despite declines in retail trade, Taylor building and relocates several administrative and support ser- until early 2014; groups to there later this year. vices and the leisure and hospital- and 131,600 square ity industries, the region marked a record-high 1,170,500 non-farm feet at the Union Airport Corridor emerges jobs in May, a gain of more than Trust Building, as top suburban market 1,000 from April. In May, the unemployment rate in the region fell which currently is in Once the darling of the Pittsburgh to 6.9%, the fourth straight month office market, the Airport Corridor of declines, besting the Pennsylva- receivership. fell from grace in the last decade, nia rate of 7.5%. suffering from over-development and the decline of the airline industry. However, the energy sector has Commercial Market Leasing activity slows, brought new life – and new devel- Overview build-to-suit construction opment – to the area over the past accelerates 36 months. The direct vacancy rate has fallen 53.7 percentage points Class A market tightens Two of the largest lease transactions since 2009, hitting a low of 5.7% throughout region year-to-date were for law and finan- in the second quarter 2013, while cial services groups. Leech Tishman, overall rental rates have edged Class A vacancy in the Pittsburgh a full-service legal services firm, slowly toward a $20 per square foot metro dropped 35.2% in the first expanded its lease at 525 William (psf) average over the same period. quarter 2013, posting a direct va- Penn Place in the CBD to 47,000 cancy of 5.7% versus 8.8% in the square feet assuming two full floors Leasing activity within the submar- same period 2012. The largest con- in the building. CPA firm, Schneider ket jumped 65% between 2009 and

44 DEVELOPINGPITTSBURGH | Fall 2013 Source: Cushman & Wakefield Research

2012, peaking at more than 1.0 major tenants move into new spaces million square feet (msf) in 2012. and subleases currently on the The reduction in available Class A market are occupied by newcomers. space has spawned new speculative Rental rates for Class A space in development in the area, including the region and all classes of space Westpointe Corporate Center Four, in the CBD are expected to climb a 130,000-sf office building situ- slightly in response to the dropping ated adjacent to the FedEx Ground vacancy rates and the continued re- and GlaxoSmithKline headquarters. duction of class B inventory due to Scheduled to be ready for occu- conversion to residential projects. pancy in 2014, the building bor- ders the 61-acre tract of land that Continued growth in the technol- Chevron recently purchased for its ogy, energy, education and health Appalachian regional headquarters. care sectors will further escalate The company plans to construct an rental rates and reduce vacancy office and research campus on the rates in the CBD. Speculative de- site with an estimated budget of velopment in the fringe markets more than $200 million. should surface in response to the rising demands of these tenants. Additionally, Dick’s Sporting Goods have been to out-of-town buyers, signed a long-term agreement to including prominent buildings such Timothy R. Goetz, Principal lease 73 acres at Northfield Com- as the U. S. Steel Tower and PPG Grant Street Associates, Inc. merce Park so that it can expand Place complex. The 80,000-sf Bank A Cushman & Wakefield Alliance its 667,000-sf corporate campus Tower recently sold to Rockmere Member. DP by another 180,000 square feet. Capital Partners, LLC, an Erie, PA This latest expansion should be group, while two additional prop- completed by 2015 and is part of a erties, including Liberty Center, are master plan that could extend the under agreement to outside inves- campus to more than 1.0 msf. tors. The City’s diverse economy and attractive business community have placed it in the company of Outside investor interest such notable markets as Boston for CBD grows and Washington, D.C.

Tightening occupancy levels and increasing rental rates in Pittsburgh’s Outlook CBD have drawn new interest from out-of-town investors. In fact, of Overall absorption should shift the last 13 high-profile building significantly to the positive side sales in Downtown Pittsburgh, 10 throughout 2013 as a number of Tim Goetz

www.developingpittsburgh.com 45 Industrial Market Update

2,500,000 Industrial Absorption (Sq. ft.) 2,000,000

1,500,000 t the half- way point of 1,000,000 2013, the In- dustrial Mar- ket contin- 500,000 ues to send mixed signalsA as to both the short 0 term and long term direction of the market. While we continue to ‐500,000 experience a very healthy market wide occupancy rate of 92% and ‐1,000,000 high occupancy rates across all property types, especially Class A ‐1,500,000 space at 95%, the market activ-

ity is not as robust as expected ‐2,000,000 at this point in the year. Year

to date absorption is a positive ‐2,500,000 2007 2008 2009 2010 2011 2012 400,000 square feet but not on Total Market 2,088,007 608,875 570,859 ‐1,978,524 1,201,492 2,050,837 pace for the historical average of 2,000,000 square feet absorption. with the national economy, which 300,000 square feet was under In our 2013 Forecast, we predicted is usually not the case. Historically, construction. On the positive side, that the historically high occu- Pittsburgh's Industrial market has the Jackson’s Pointe Commerce pancy levels which had risen to the lagged the trends of the national Park in Butler County came on line pre-recession levels of 2007-2008 industrial market, both in good in the spring of 2012 and within 15 should result in an uptick in con- times and bad. For instance, 2007- months has completed transactions struction activity in 2013 as Class A 2008 and even 2009 were years of for 80% of the planned 335,000 space inventory was at dangerously positive absorption for Pittsburgh square feet industrial sites. UPS low levels, especially for larger while the national industrial market opened its 45,000 square feet users in excess of 150,000 square experienced negative absorption in facility in April; the initial 70,000 feet. While there are some note- 2008-2010. While the Pittsburgh square foot spec building achieved worthy build-to-suit projects on the market had negative absorption for 100% occupancy and a 150,000 horizon, the positive news has been 2010, it was a direct result of the square feet warehouse distribu- tempered somewhat by the surpris- closure of the Sony plant in New tion center for Highmark is under ingly longer shelf life of the few Stanton which added over 2 million construction with a fourth quarter large vacant Class A buildings in square feet of vacant space to the 2013 delivery. historically strong submarkets such market. In both 2011 and 2012, as the West and Northwest in the the Pittsburgh market experienced In the Thorn Hill Industrial Park, 120-130,000 square feet size. We positive absorption albeit at a slow Pella Windows & Doors acquired stated the Industrial Market to be 1-1.5% annual growth rate. a 7 acre site to construct a new at a tipping point whereby a few 40,000 square feet office/ware- large deals would potentially create Construction activity in the Indus- house/showroom with a late Q4/ a crisis as the shortage of competi- trial Market has been very limited early Q1 2014 completion date. tive space for larger users would the past several years. While specu- With the completion of the first of not allow for the normal expan- lative industrial development has two 48,000 square feet R&D/Flex sions, consolidations and business historically been limited to a hand- buildings by The Elmhurst Group attraction. ful of local developers, construc- this summer, there are only two tion activity in 2012 was at his- viable development sites left in It appears that the Pittsburgh torically low levels and during the one of the region’s most successful industrial market may be in sync first six months of 2013 less than business parks.

46 DEVELOPINGPITTSBURGH | Fall 2013 In close proximity to its Thorn addition to the 350,000 square feet Hill Industrial Park headquarters, It appears that the already occupied in Phase I. Mitsubishi Electric Power Products continued its expansion in the Tri Pittsburgh industrial Also in the West Submarket, at County Commerce Park. Shortly the Clinton Commerce Park, the after leasing 50,000 square feet market may be in 227,000 square feet Flabeg Solar construction is now starting on sync with the national Panel manufacturing facility an- the remaining 70,000 square feet nounced its closure in the spring of building resulting in the comple- economy, which is 2013. While it is unfortunate that tion of this successful 1,000,000 usually not the case. this highly subsidized project did square foot industrial park. not achieve the desired results, this Historically, Pittsburgh's quality building should attract in- It was recently announced that industrial market has terest from other manufacturers in Gordon Food Service is planning the region to take advantage of its to acquire a 62 acre site in the lagged the trends of unique size and infrastructure and Findlay Industrial Park at Westport the national industrial expected availability in late 2013. with the expectation of beginning construction on a 420,000 square market, both in good The much awaited decision by foot food distribution facility that times and bad. For Royal Dutch Shell regarding the will provide over 200 jobs. This is proposed ethane cracker plant in exactly the size and quality user instance, 2007-2008 and Potter Township, Beaver County the developers hoped to attract for remains in a holding pattern as the this unique privately owned de- even 2009 were years June 30 option period was extend- velopment project. With over 300 of positive absorption ed by Horsehead Zinc, which is still acres placed in service and over in the process of shutting down the 100 acres absorbed since the park for Pittsburgh while 300 acre site. While the proposed opened in 2009, the Findlay Indus- the national industrial ethane cracker plant was never trial Park at Westport is positioned expected to start until mid-2014, to provide fee simple ownership to market experienced this remains the largest and most occupiers and merchant develop- negative absorption in significant economic development ers with an additional 2,000,000 project in Southwestern Pennsylva- square feet planned for Phase II in 2008-2010. nia and if it proceeds should have a

www.developingpittsburgh.com 47 Unmatched Real Estate services. A game-changing platform. Full-service integrated real estate solutions for tenants, buyers, landlords, owners, developers and investors around the globe.

Gerard McLaughlin Executive Managing Director [email protected] Louis Oliva Executive Managing Director [email protected] 6 PPG Place, Suite 600, Pittsburgh, PA 15222 T 412.281.0100

North America  Europe  Asia-Pacific  Africa  Middle East www.ngkf.com Class A Industrial Vacancy 12.0% Overall Industrial Vacancy

9.0%

10.0% 8.0%

7.0%

8.0%

6.0%

5.0% 6.0%

4.0%

4.0% 3.0%

2.0% 2.0%

1.0%

0.0% 0.0% 2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012 Total Market 8.3% 5.7% 5.0% 5.6% 5.7% 3.9% Total Market 7.7% 7.1% 8.3% 10.4% 9.2% 7.4%

Source: Newmark Grubb Knight Frank significant impact on both existing opers in Pittsburgh and regional/ and proposed industrial develop- There were a national developers considering ment sites throughout Beaver Pittsburgh that there is a viable County and the West Submarkets few noteworthy exit strategy for investing in our as demand for space by both Industrial Investment market. midstream and downstream users should increase significantly. In transactions in the In closing, if we are able to reach addition to the $4 billion con- 2,000,000 square feet in absorp- struction project, both the per- first half of 2013. tion for the year, it should bode manent jobs at the plant and jobs Historically, the well for 2014 and beyond as the created by other industrial users/ expectation of an improving na- occupiers should be a demand Pittsburgh market has tional economy coupled with the driver for the region. experienced limited local dynamics of the energy industry should increase demand for There were a few noteworthy In- industrial investment industrial space in our region. dustrial Investment transactions in sales as the market the first half of 2013. Historically, Louis V. Oliva, CCIM, SIOR is the the Pittsburgh market has experi- is dominated by Executive Managing Director for enced limited industrial investment privately held owner Newmark Grubb Knight Frank and sales as the market is dominated specializes in the Industrial Prop- by privately held owner occupants occupants and a erty Market. He can be reached and a handful of industrial de- handful of industrial at [email protected] or (412) 434- velopers who prefer a ‘develop 1053. and hold’ strategy rather than a developers who DP ‘develop and sell’ strategy. As a result, there are very few national prefer a ‘develop and or institutional owners in Pitts- hold’ strategy rather burgh. The irony is the Pittsburgh market is now on the radar of than a ‘develop and national and institutional investors sell’ strategy. for additional acquisition. Howev- er, these investors typically look at assets in excess of 200,000 square center in Beaver County was sold feet or $10M in value and require to a national private investor for Class A construction quality. As $20,000,000. The offering received only 20-25% of our total inven- bids from investors throughout the tory falls into this classification, it northeast, Midwest and Mid-Atlan- is easy to deduce why investment tic regions. In the second quarter, activity has been limited. the 53,000 square feet R&D/Flex Lou Oliva building at 700 Waterfront Drive In the first quarter, the 410,000 was acquired by a local investor. square feet Turnpike Distribu- This was an encouraging sign and tion Center, a Class A multi- should reassure both local devel- tenant warehouse distribution

www.developingpittsburgh.com 49 Retail Market Update

ittsburgh is significantly by the end of this new urban dwellers compliment booming! Our decade. As a result, Pittsburgh has nearly 168,000 commuters to the metropolitan received much attention nationally CBD. market area and the accolades include: experienced Retailer Scene: an increase in • Top 10 Great Cities Grocery competitors including employmentP with 11,888 new jobs for starting a business Whole Foods, Fresh Market, Trader added in the 2nd Quarter 2013, Joe’s, Rare Earth, Bottom Dollar placing the seasonally adjusted • Top 10 Cheapest Cities Food and Aldi’s are challenging the unemployment rate at 6.8% in June to Live in regional dominance and market 2013. Housing within the region share of Giant Eagle. Restaurateurs remains highly affordable even • Top 10 Greatest Places Chipotle, Starbucks, DiBella’s and with average sales prices increasing to Live Panera Bread continue to expand 2.8% year to date. within the region. Meanwhile new • Top 10 Destination City emerging concepts grabbing a Distinguished regional medical for Travel and Leisure foothold within the full service and systems include UPMC and High- QSR concepts include: Noodles mark. Prominent urban universi- Retailers seeking a new frontier & Company, Piada Italian Street ties located within the urban core for expansion have credited the Food, Panda Express, Bonefish Grill, include Carnegie Mellon University, success and repositioning of the Carrabba’s, Longhorn Steakhouse, the University of Pittsburgh and Central Business District (CBD) Pizza Cuccinova, Burgatory and Duquesne University. The Pittsburgh as the primary ingredient for the Jason’s Deli. Convenience store region has become the epicenter rediscovery of the Pittsburgh region competition is ongoing with Speed- for an emerging natural gas indus- for development. Dozens of new way, Sheetz, Get Go and 7-Eleven try and is poised to see the num- restaurants, several new hotel an- vying for key corner locations ber of energy-related careers grow nouncements, and thousands of throughout the metro area. On the

50 DEVELOPINGPITTSBURGH | Fall 2013 junior anchor box front LA Fitness, rates while tenant incentives have Ross Dress for Less, HomeGoods, evaporated and operating expenses Petco, Hobby Lobby and Dick’s continue to increase. Sporting Goods are most active. The inaugural location of Field & Nationally, new ground-up retail Stream (50,000 square feet), Dick’s developments continue in large Sporting Goods newest concept, part to be non-existent. Pittsburgh opened in August of this year in has several ground up projects the former Dick’s location in Cran- underway including Phase 4 of berry Township. McCandless Crossing (211,916 square feet), Phase 2 of Cranberry Development Scene: Crossroads (125,000 square feet), Vacancy rates for Regional Shop- The Gardens at Market Square in ping Centers have approached all the CBD, and Siena at St. Clair time low rates of 3.8%. Likewise, (131,000 square feet). Regional Malls share equally low vacancy rates of 4% in the primary The demand for supply will be in markets. While most national met- part answered through the redevel- ropolitan retail markets are expe- opment of several well established riencing across the board lower and mature regional centers. The retail rates, Pittsburgh is quite Shoppes at Northway (495,000 the opposite. High demand and GLA) in the North Hills on McK- low supply of product have either night Road was acquired by LRC stabilized or increased base rental Realty and is planned for a rede-

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www.developingpittsburgh.com 51 tal Investments earlier this year. tinue to challenge us to meet these Plans for Century III Mall include demands with sufficient supply. a consolidation of the retail GLA The CBD and the to 1,100,000 square feet while Kevin Langholz is a principal and three rivers which introducing a focused redevelop- retail brokerage leader for ment master plan that includes Langholz Wilson Ellis Inc. define it, embrace entertainment, restaurants, medical DP the many recreational and hospitality. Washington Crown Center in Washington, PA will wel- activities, live theatre come Marshall’s and several new performances, merchants to reposition the center as an apparel destination. professional sports teams and the arts Our universities, energy resources, innovative technology, financial that distinguish our institutions, research, and hospitals are the foundation on which region from so many Pittsburgh will continue to grow others. and expand into the coming decades. The CBD and the three rivers which define it, embrace the many recreational activities, live theatre performances, professional sports velopment in 2014. Several new teams and the arts that distinguish retail anchors will compliment a our region from so many others. Kevin Langholz new merchandising mix that will As we continue to flourish from include restaurants, apparel and the core outward, the goods and grocery. Century III Mall (1,720,000 services offered by retail will be in GLA) in the South Hills at Rt. 51 demand. Topography, infrastructure was acquired by Moonbeam Capi- and maturity of market will con-

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52 DEVELOPINGPITTSBURGH | Fall 2013

National Market Update

espite The technology and en- eco- ergy sectors continued nomic to fuel demand across head- the country. Energy winds companies accounted from for the bulk of metro federal budgetD sequestra- Houston’s 1.2 million tion, the U.S. office market sq. ft. of positive ab- continued its steady pace of sorption, while tech- recovery during Q2 2013. Of- nology and healthcare fice demand benefited from a users contributed to slightly lower unemployment the nearly 1.0 mil- rate, at 7.6% as of June, and lion sq. ft. of positive growth in professional and absorption in metro business service jobs, with Boston. In Midtown the national vacancy rate South Manhattan, also decreasing by 20 basis points known as Silicon Alley, (bps) during the quarter to tech demand fueled 15.2%. This was the fourth 700,000 sq. ft. of posi- quarterly decline in the last tive absorption during five quarters. Q2 2013, the highest level of positive While economic growth was absorption of all U.S. apparent across the country, downtown markets. we saw some regional diver- gence in the performance of Minimal levels of new the office market. Three of office construction the four U.S. regions posted continued to keep va- an overall decrease in vacancy levels relatively cancy during Q2 2013. The low. However, although lone exception was the East, Q2 2013’s 3.9 million where the regional vacancy sq. ft. of new supply rate held steady at 13.2%— more than doubled still the lowest of all U.S. Q1 2013’s completion regions. The lack of improve- level, delivery levels ment in the East was a result remained significantly of diminished activity by the below pre-2008 lev- federal government and the els. Most multi-tenant financial services sector, as construction projects well as right-sizing by occu- still required an an- piers. chor tenant, though several major markets had speculative con-

The U.S. office vacancy rate month during Q2 2013, with by the implementation of dropped 20 basis points increases in business and more efficient workplace (bps) during Q2 2013 to professional service jobs ac- strategies which has resulted 15.2%, continuing its slow, counting for 31% of the quar- in a reduction in the over- steady pace of recovery. ter’s employment gains. all footprint of many financial and professional services U.S. employment gains aver- The positive effect of employ- firms. aged 188,000 new jobs per ment gains were dampened

54 DEVELOPINGPITTSBURGH | Fall 2013 struction projects underway as of counted for 31% of both the quar- the end of the quarter. Speculative ter-over-quarter and year-to-date projects in desirable submarkets gain in private sector employment, with single-digit vacancy rates in outpaced only by leisure and hospi- Houston, San Francisco, Boston, tality, which accounted for 34% of Manhattan and Denver have gener- the year-to-date gain. Meanwhile, ated significant tenant interest. government posted a 1.3% year- U.S. employment gains continued to-date loss in employment due to their fairly steady pace, averaging automatic budget cuts which also an increase of 188,000 new jobs negatively impacted aerospace and per month during Q2 2013. Busi- defense contractors. With stronger ness and professional services ac- employment, an improving hous-

Sequestration’s negative Strong investment sales activ- was most prevalent in tech- impact on tenant demand ity in Q2 2013 contributed to nology- and energy-heavy was concentrated in markets a 22% year-over-year increase markets that have exhibited reliant on the government in total transaction volume strong tenant demand. and government contractors, for the first half of 2013. particularly aerospace and defense. Speculative construction, while still at historic lows,

www.developingpittsburgh.com 55 ing market and individual investors more bullish on the stock market, the consumer comfort index improved to -28 versus the 12-month average of -35, according to Moody’s Analytics. The pace of office investment sales activity picked up during the Q2 2013, with strong interest from overseas buyers. Federal Reserve Chairman Bernanke’s comments in June drew attention to the inevitable tapering of the Fed’s quantitative easing program, leading to further interest rate volatility during the latter part of the quarter.

While 2013 investment activity remained on track for a strong year—transaction volume for the first half of 2013 paced 22% ahead of the same six- month period in 2012, according to Real Capital Analytics—the return parameters of leveraged transactions will be affected by recent increases in 10-year treasuries. Any actions taken by the Fed in response to economic growth, however, will be somewhat mitigated by improving market fundamentals. In markets like Manhattan, partial DEVELOPMENT interest transfers and a bifurcation of assets have increased, allowing landlords to capitalize on price gains and investors to obtain a piece of the most desirable, but still limited, product. Secondary and suburban markets recorded an uptick in sales volume as investors were more willing to venture further out on the risk spectrum in light of improving market fundamentals.

CBRE U.S. Research Team is part of CBRE Global Research and Consulting – an integrated com- BROKERAGE munity of preeminent researchers and consultants who provide real estate market research, econo- metric forecasting, and corporate and public sector strategies to investors and occupiers around the globe. For more information contact:

Jeffrey Ackerman CBRE | Managing Director Pittsburgh Market Leader 600 Grant Street, Suite 4800 Pittsburgh, PA 15219 PROPERTY (412) 471-9500 [email protected] MANAGEMENT DP

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Construction LaLannd Use EEnvviiroonmenm ntan al Litigatiot on

CrCreedditors’ Rigghtst EEnenergy & EmEmpmploymmenent & Innsolvencyn y Naatuuraal Resoourrcees BBuusinineess SerSe vviccess & Labboor Legal/Legislative Outlook

the creation of a new lien Significant notice system for project owners and subcontractors Amendments to to follow. In order to manage and facilitate the new Pennsylvania’s notice requirements, the Bill calls for the creation Mechanics’ Lien of a “State Construction Notices Directory” (“Direc- Law Appear tory”) website by July 1, 2015*. The Pennsylvania Imminent Department of Labor and Industry will be respon- By Richard D. Kalson, Esq. and James sible for the Directory. D. Miller, Esq. The Directory will serve as the database for owners I. Introduction and History to file a “Notice of Com- mencement” and subcon- The Pennsylvania General Assembly tractors to file a “Notice is seriously considering enacting its of Furnishing.” These two third set of amendments to the Me- types of notices are criti- chanics’ Lien Law of 1963, 49 P.S. cal creations of the Bill. § 1101 et seq. (the “Lien Law”), It is possible that filing within a five year span. House Bill fees payable by the project No. 473 (the “Bill”) would add new owner may be required. notice requirements to the Lien Law, as well as a number of other These new notice require- revisions. ments seek to address the longstanding problem After decades of remaining un- in Pennsylvania of own- changed, the Lien Law received ma- ers and contractors not jor revisions in 2007, followed by knowing the identity of additional amendments in 2009. A subcontractors or material frequent criticism of the Lien Law, suppliers furnishing labor a descendant of a remedial statute or materials for a project. first enacted in Pennsylvania dur- As a result, an owner or ing the late 1700s, is that its rigid contractor often did not and antiquated provisions are not even have knowledge of adequately equipped to respond the identity of a potential to many modern day construction lien claimant, let alone the situations and payment issues. fact that they possessed a The Bill is another attempt by the claim, until receiving a no- General Assembly to modernize and tice of intent to file a lien. improve the provisions of the Lien The Bill provides the owner Law while balancing the interest with the right to file a of owners and lenders against the Notice of Commencement interests of constructors and sub- with the Directory before contractors. work on an improvement begins in order to iden- II. Amendments Proposed by tify all subcontractors and the Bill material suppliers that may have lien rights through A. New Notice Requirements their subsequent required filing of a Notice of Fur- The majority of the Bill focuses on nishing.

www.developingpittsburgh.com 59 1. Notice of Commencement reposting the Notice within 48 hours of being notified in writing In order for a Notice of Commence- The Bill critically or by e-mail that the Notice is not ment filed by an owner to be effec- requires that posted at the project site. The Bill tive, the owner must include, at a does not explain the ramifications minimum, the following informa- subcontractors of failing to use reasonable mea- tion: (1) name, address, and e-mail sures to ensure the Notice remains address of the contractor; (2) name have an affirmative posted at the project site, but a and location of the construction duty to check subcontractor might possibly be project; (3) legal description of able to take advantage of such a property upon which the improve- the Director y failure to excuse an untimely filing ment is being made; (4) name, to determine of a notice of furnishing, at least address, and e-mail address of for the duration that the owner legal owner of record of the prop- whether a Notice failed to comply with the posting erty; (5) name, address, and e-mail of Commencement requirement. There also is no indi- address of person other than true cation in the Bill of whether sub- legal owner at whose direction has been filed for stantial compliance with the Notice the improvements are being made, a project before of Commencement requirements if any; and, (6) if applicable, the will be considered to be sufficient, name, address, and e-mail address performing work or if the failure to strictly comply of a surety providing performance or furnishing with the provisions will excuse the and payment bonds. H.B. 1602 § subcontractor from having to file 501.2(A)(1). Although the Bill fails materials. H.B. the Notice of Furnishing. to expressly address the situation where a project has several con- 1602 § 501.2(B) 2. Notice of Furnishing tractors that have contractual priv- (1). In addition to ity with the owner, it can reason- If the owner properly and timely ably be presumed that the owner is filing the Notice files the Notice of Commencement, required to include the specified in- of Commencement the Bill provides that a subcon- formation for all contractors in the tractor must serve a “Notice of Notice of Commencement. The Bill with the Director y, Furnishing” in order to preserve also does not address whether an the owner also its right to file a mechanics’ lien. owner has a duty to amend a filed Id. at § 501.2(B). The Notice of Notice of Commencement if the must conspicuously Furnishing must be served on the identity of a contractor changes or post the Notice of owner either by personal delivery the owner contracts with an addi- (with a signed acknowledgment by tional contractor. Commencement the owner), certified mail, or filed at the project with the Directory within 20 days The owner’s filing of a conforming of first performing work in connec- Notice of Commencement should site before work tion with the construction of the prevent certain difficult situa- improvement in order to have the tions that arise in mechanics’ lien commences, and lien cover all work performed for cases. For example, the Notice take reasonable the project. Id. at § 501.2(B)(2)(II). of Commencement should elimi- Otherwise, a lien claim will be valid nate instances where a contractor measures to ensure only for the labor and materials mistakenly believes it is contract- the Notice of furnished beginning on 20 days being with the property owner, but fore the date on which the Notice later discovers that the contracting Commencement was served. party is not the legal owner or that remains posted the work was not performed at the The Bill requires that the Notice direction of the legal owner. throughout the of Furnishing must include the duration of the following information: (1) gen- The Bill critically requires that eral description of the labor, skill, subcontractors have an affirma- project. materials or equipment furnished; tive duty to check the Directory (2) name and address of the per- to determine whether a Notice of son supplying the items stated in Commencement has been filed for Commencement at the project site the work description; (3) name and a project before performing work before work commences, and take address of the person with whom or furnishing materials. H.B. 1602 reasonable measures to ensure the the subcontractor contracted with § 501.2(B)(1). In addition to filing Notice of Commencement remains for the work, and, (4) a description the Notice of Commencement with posted throughout the duration of of the property being improved. In the Directory, the owner also must the project. “Reasonable measures” determining whether the subcon- conspicuously post the Notice of is defined in the Bill as the owner tractor has met these requirements,

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3308 143 5773 Cool Gray 6 100:0:60:72.16 0:35:85:0 9:0:43:38 0:0:0:31 01:48:3A FB:B0:40 9E:A3:74 BA:BC:BE the Bill declares that a standard of Furnishing by the owner’s failure “substantial compliance” must be to include required information in used. Therefore, a subcontractor For those who the Notice of Commencement only forfeits its right to file a mechan- when the omitted information is ics’ lien if it fails to substantially have been involved necessary to complete service of comply with the Notice of Furnish- in construction the Notice of Furnishing on the ing requirements. owner or its designee. The court projects in found that the inclusion of the B. No Lien on Residential Prop- name and address of the property is Permitted for Amounts Paid Ohio, the notice erty owner and original contractor by Owner to Contractor in the Notice of Commencement requirements was all that was necessary for the The final change proposed by contained in the subcontractor to serve the No- the Bill modifies the Lien Law to tice of Furnishing. The trial court provide that a subcontractor does Bill certainly are discounted the significance of the not have a right to file a lien on a owner’s omission of the date the residential improvement when the familiar as they owner first executed a contract, a owner paid the contractor the full closely resemble complete list of all original contrac- contract price, and the property tors, and the address of the person is or will be used as the residence provisions in preparing the notice form, and of the owner. H.B. 1602 § 301(b). misidentification of the original The Bill further provides that a lien Ohio’s Mechanics’ contractor from the Notice of Com- filed against residential property mencement. Thus, the subcontrac- will be discharged when the full Lien Law. Ohio tor was not excused from failing to contract price is paid to the con- employs a similar serve the Notice of Furnishing. On tractor or will be reduced to the appeal, the Ohio Court of Appeals amount of the unpaid contract notice method affirmed the lower court’s deci- price owed by the owner or tenant sion on the basis that the owner’s to the contractor. The amendments involving a Notice Notice of Commencement substan- in this instance serve the public tially complied with the Ohio Lien policy of consumer protection and of Commencement Law the Notice, and was sufficient protecting homeowners who may filed by the owner to put subcontractors and material not be equipped to deal with the suppliers on notice of the owner’s onerous requirements of the Lien (or its designee) identity and the location of the Law. and a Notice of construction work. II. A Look into the Future in Furnishing served Conversely, in Clinton Elec. & Pennsylvania by Examining Plumbing Supply v. Airline Profes- the Past in Ohio: by subcontractors sionals Assn., Loc. 1224, 2006 Ohio Courts’ Interpretation Ohio 1274 (Ohio Ct. App. Mar. 20, of Notice of Commence- and material 2006), the court of appeals excused ment and Notice of a subcontractor from filing a Notice Furnishing Requirements suppliers. of Furnishing when the owner ab- under the Ohio Lien Law breviated its name in the Notice of Commencement, which failed For those who have been involved county recorder where the prop- to comply with the requirement in construction projects in Ohio, erty is located and are subject to that the Notice of Commencement the notice requirements contained additional provisions to ensure that contain the name of the owner of in the Bill certainly are familiar as the appropriate parties receive the the real property. The distinguish- they closely resemble provisions in notices. The following Ohio court ing characteristic of this case is Ohio’s Mechanics’ Lien Law. Ohio decisions interpreting Ohio’s notice that the mistake was deemed to be employs a similar notice method provisions may prove to be a useful a substantial deficiency because it involving a Notice of Commence- guide in predicting how the Bill prevented the correct indexing of ment filed by the owner (or its will be interpreted and enforced by the Notice of Commencement un- designee) and a Notice of Furnish- Pennsylvania courts. der the owner’s proper name, and ing served by subcontractors and a search of the owner’s name failed material suppliers. See ORC §§ For example, in Linworth Lumber to show the existence of the Notice 1311.04-1311.05. Unlike the Direc- Co. v. Z.L.H., Ltd., 802 N.E.2d of Commencement. The court also tory website proposed by the Penn- 736, 742 (Ohio C.P. 2003), aff’d, refused to interpret the Ohio Lien sylvania Bill, however, Ohio has no 2003 Ohio 4190, P24 (Ohio Ct. Law to place a burden on the lien central database for such notices. App. Aug. 4, 2003), an Ohio trial claimant to prove that it was preju- Instead, notices of commencement court held that a subcontractor is diced by the defect in the Notice must be filed with the office of the excused from serving a Notice of of Commencement before the lien

62 DEVELOPINGPITTSBURGH | Fall 2013 claimant’s failure to file the Notice period before the filing or record- of Commencement and Furnishing of Furnishing would be excused. ing of the Noticing of Furnishing. will contain several subtle variances The establishment of the Direc- In Ohio, the lien claim relates back from Ohio’s statutory language, tory may eliminate this potential to 21 days before the Notice of which may lead to different out- indexing mistake because the Bill Furnishing is served or recorded. comes under similar facts. More- provides that the Notice of Com- Because the Notice of Furnishing over, the existence of the Directory, mencement must be searchable, at issue in that case was recorded which does not exist in Ohio, may at minimum, by the owner’s name, outside the 21-day period, none of compel Pennsylvania courts to treat contractor’s name, and the prop- the work furnished by the subcon- certain notice deficiencies in a less erty address. Thus, a mistake in the tractor was covered by the lien and lenient manner. Nonetheless, the owner’s name would not affect a the lien was invalid. The court also Ohio decisions serve as a useful subcontractor’s ability to search the held that the owner’s failure to warning to owners, subcontrac- Notice based on the property ad- properly post the Notice of Com- tors and material suppliers of the dress and contractor’s name. mencement at the project site, and potential pitfalls involved with the the owner’s failure to include the proposed notice requirements, and An excellent example from Ohio date on which the owner first con- illustrate important considerations of the crippling effect of a sub- tracted with an original contractor that should be taken into account contractor’s untimely filing of the in the Notice of Commencement when beginning a construction Notice of Furnishing is Jim Morgan did not excuse the subcontractor project and fulfilling the notice Elec. Co. v. Smith, 684 N.E.2d 117, from timely serving its Notice of mandates. 120 (Ohio C.P. 1996), in which the Furnishing. court held that a subcontractor’s Rick Kalson and James Miller are failure to file its Notice of Furnish- While these Ohio cases may not attorneys in the construction and ing until forty-eight days after the prove to be accurate predictions land development practices at last day it performed work on the of how Pennsylvania courts will Babst Calland. project precluded the filing of a interpret and apply the amend- DP lien altogether. The Ohio Lien Law, ments contained in the Bill, they like the proposed Pennsylvania are the best guidance available at amendments, permits a lien claim this time. Pennsylvania’s statutory to relate back to a certain defined language with respect to Notices

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came down from leadership that DP: What ideas or decisions can you Barbara McNees we needed to combine the efforts point to that made the difference in of all the organizations to get the how our region was transformed? Reflects on most out of their efforts and maximum the return on what they were BAM: A big change was the pass- Pittsburgh investing. ing of the Brownfields Act so that we could get the Commonwealth n August That was right about the time that of Pennsylvania to put dollars in 15, Barbara the Allegheny Conference had done and we could begin cleaning up A. McNees the Working Together Consortium the sites so that development could retired as that was led by Dr. Mehrabian, who occur. The first brownfield I was in- president was president of Carnegie Mel- volved with was the Second Avenue of the lon. Dr. Mehrabian in that report site [the former J & L site] which is Greater PittsburghO Chamber of talked about the need to become now the technology corridor. Pri- Commerce after 16 years in that a region, that the areas that were vate developers and banks wouldn’t office. Her career in economic doing well across the country were touch that site because of the development included work at the acting as a region. So as we moved cyanide in the slag. You couldn’t Beaver County Chamber of Com- forward there was really a strong get financing. So the RIDC came in merce and eight years working for support from leadership to put and put up the first building and Governors Casey and Ridge. During together an organization so that did some of the first environmental that time she witnessed the region we could function as a region. The work that needed to be done. It experience “crisis, recovery and result of all that is what we have was really one of the first ventures transformation” and takes pride now, the Allegheny Conference and we did on a contaminated site. So in leaving at a time when Pitts- its affiliates so that we could deliv- to see that turn around and then burgh’s future looks even brighter. er on the organizational structure move down the river to the next DevelopingPittsburgh sat down and then work through leadership sites felt very good. with McNees and asked her to take throughout the region to develop stock of what has transpired during what the issues are so we can de- One of the biggest challenges we her tenure. cide where to put our resources. had with the brownfields was with the people who lived in those com- DP: What are the accomplishments We do that in three-year chunks, munities. When we came in to tear of the Chamber that you feel had putting together a strategic plan those buildings down there was the biggest impact? every three years with our leader- tremendous objection from the ship. I think that’s very important. communities because even though BAM: Coming to the Chamber in This is a leadership-driven effort the steel industry had gone away, 1997, it was about the time that not a staff-directed effort. It’s an people in those communities didn’t the leadership began to look at important reason why we’re now want to see those buildings come merging the four organizations seen as a region and really do func- down because they still had hope [Greater Pittsburgh Chamber of tion well regionally. that the industry would return. Commerce, Pittsburgh Regional So even though we were cleaning Alliance, Allegheny Conference You talk about the transformation those sites up and making them On Community Development and of Pittsburgh the city and that’s the ready for the future it was pretty Pennsylvania Economy League], and brand but a lot of the real develop- stressful for those communities a few of us that were hired then ment has been done in the counties and their leadership. If you look were actually brought in to make outside of the city. That truly is a now at what’s developed on those that happen. There were a lot of result of turning us into a region sites and the economic generators organizations doing a lot of dif- and developing a strategy to enable that are there now, it was the right ferent things and the same people us to work together. thing to do. were leading all of them. The word

www.developingpittsburgh.com 65 The Keystone Opportunity Zone that tions program aimed at marketing do that well but again it’s at the originated in the late 1980’s and Pittsburgh to Pittsburghers. Other federal level where we need a solid early 1990’s was also a big help. regions were marketing themselves energy policy that’s not all over the We’ve used them very well in South- to people outside but we discovered place. Coal is still a big part of the western Pennsylvania and KOZ’s have after very painstaking survey and energy sector here and we need to contributed to the development of research that what we needed to do do more research around clean coal. many sites. was change the perception of the And what’s happening in the nuclear people in this region about what this industry is sad. We should be able to Another thing that helped with the region is. I think we have come full do nuclear energy here and not have transformation was Jared Cohon and circle on that. We now have people to only export it. I think Pennsylva- Mark Nordenberg coming together who are so proud to be Pittsburghers nia is going to be a huge player in to stop being competitors and start and proud of the transformation that the energy industry just like we were being very collaborative. They both has occurred because of all the hard back when they first discovered oil could do what they did very well work that has been done. I don’t in Titusville. and of course the medical research think we have the cab driver saying, piece being brought in from UPMC ‘why did you come here’ anymore. And the other issue that is important created growth in the total research is the whole air service area. It’s not dollars coming into the region. They That is one of the biggest changes I just for Pittsburgh but for Cincin- stopped licensing the technology to have seen. We are no longer deroga- nati, Columbus, St. Louis and smaller people from California, Boston and tory about Pittsburgh but are very cities. How do you push air service other areas as well. Their commit- proud of where we are. back to the cities that aren’t New ment to keep the licensing here and York or Atlanta or Chicago? I think grow the companies here and the DP: What would you want to accom- that’s an issue again, that is critical ability of the private sector to raise plish if you were presiding over the to the attraction and retention of venture capital resulted in the whole Chamber for another 10 years? jobs. innovation economy built around research. BAM: I think over the next ten years DP: What will you do all day now? the challenge is going to be the I think another key when you look at talent attraction. We’re edging our BAM: (Laughs) I don’t know! It will our skyline is our corporate leader- demographics a little younger but be interesting to see. I told my hus- ship. We’ve been very blessed in not necessarily gaining more people. band that I woke up in the middle terms of commitment to have PNC, No region is growing by having more of the night with a nightmare that BNY/Mellon and all the law firms babies; they are growing through im- I’m going to have to cook him lunch that make their worldwide head- migration, talent attraction. And as every day. That is not a goal! He may quarters here. They put their money you look at people like me, the Baby have to learn to cook. We have some where their mouths are. They could Boomers, we’re going to be retiring travel plans, some things to do that have built offices and operations over the next ten years and the next we haven’t had time to do over 30 centers anywhere. They chose to do generation has to be ready to step years. We’re not the kind of people it in Pittsburgh and in downtown to in. They have to have the right skills, to just take it easy so I’m sure we’ll keep it vital. The revitalization that the right education to take the jobs find things to do to stimulate us began with Renaissance I and Gate- that are going to be available. intellectually. way Center continues because we’ve DP been so blessed to have corporations The whole diversity and immigra- that are very committed, very active tion problem I think is going to be and involved in the community. our next great challenge. We have the companies but they won’t stay if DP: What are the most significant they don’t have the people with the changes that have occurred in the skills they need to do the work. We region over the past 25 years? have a great history with immigra- tion in this city; that’s who we are. BAM: That's an interesting question. But there has to be a federal im- I think the most significant change migration policy that works so that has been in Pittsburghers them- the people with the skills that are selves. When I first moved back here needed can come to Pittsburgh and and we had lost the steel industry, be part of the economy. we looked at the strategic opportunities and would bring site location The other thing that would be on my experts in and the first thing a Pitts- ‘to do’ list would be the whole ener- burgher would say to them would be gy industry. That’s either going to be ‘why do you want to be here, why a big boom or not but we’ve done a Barbara McNees do you want to be in Pittsburgh’? good job in Pennsylvania of regulat- After Bill Flanagan came in, we ing the industry so that it’s envi- went through a whole communica- ronmentally friendly. I think states

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Developing Leaders Offer a Suggestion to Pittsburgh’s Next Mayor

Mary Margaret McCarty Adam Viccaro Kyle Prawdzik Sales Executive Associate Director Herbert, Rowland & Grubic, Inc. CBRE Inc. HFF

Having The first The first been born thing I thing that and raised would like I would less than to see the like to see 10 miles new mayor the new from down- of Pitts- mayor do town Pitts- burgh do is is to take burgh (Mt. to lift the a more ac- Lebanon) natural gas tive role in I’ve been drilling ban marketing fortunate in the City the city to enough to of Pitts- outsiders. grow up burgh. It’s The city of experienc- well known Pittsburgh ing everything the city has to offer. that many of the oil and gas com- is going through a major renais- Now, as a young professional, I am panies who are opening offices in sance, and as locals we are all especially interested in following the region are avoiding the City of aware of the positive press about the developments in Pittsburgh’s Pittsburgh because of the natural our city. Outsiders are also starting revitalization. To the new mayor of gas drilling ban. I don’t believe to notice that our city has changed. Pittsburgh, I would like to see you that any of these companies will We have had face-to-face meetings re-capture younger suburbanites. actually drill in the city limits but with over 60 institutional commer- I see many young adults choosing knowing that the City of Pittsburgh cial real estate investors in the last to move out into evolving sub- supports drilling just may attract a year that all want to invest capital urbs such as Robinson, Cranberry, large corporate user to construct a in our region. The problem is that and Washington, PA. Pittsburgh high rise Class A office tower for for every one person who has heard is undergoing an exciting resur- itself or to lease a large block of about the new Pittsburgh there are gence in commercial and residen- vacant space in the CBD. still ten people who think of Pitts- tial development and I believe the burgh as a smoky post-industrial mayor should play an active role in city. We need the new mayor to attracting people and businesses jump on the positive press train back to the city. There are several and take a keen interest in orga- new and planned projects contrib- nizations like Visit Pittsburgh, the uting to our revitalization, such Allegheny Conference, the PDP and as the loft apartments in the Strip the PRA. If we continue to heavily District, restaurants and nightlife market the city on a global scale in Market Square, and the river- we will continue to see outsiders front developments on the North want to live, work and invest in our Shore. It is my hope that the new city. mayor of Pittsburgh will be committed to promoting the city as a premier spot for professionals to live, work, and enjoy. I’m excited for Pittsburgh’s revived growth and I’m looking forward to its bright future.

www.developingpittsburgh.com 69 Stacey Watson Peter Arnoldt Billy Hinton Vice President Consultant Director of Business Development Huntington National Bank RCx Building Diagnostics Nello Construction Co.

The first Pitts- We need thing I burgh’s a a strong would proud city advocate in like to with good the mayor’s see Pitts- reason. office to burgh’s Regardless, expedite next mayor we can’t the approv- accom- rest on our al of large plish is to laurels. commercial meet with Public- projects. US Steel transporta- The notion and en- tion by far of online sure they is the #1 permitting remain opportu- was recommended in 2008 when an downtown. From a micro level, if nity for improvement in the region. audit of Pittsburgh BBI took place, US Steel left the CBD, it would cer- From the inactivity at the airport however, was never fully imple- tainly hurt the office market by in- to the Port Authority debacle, our mented. Around that time, per- jecting significant office space into transportation issues are abundant. mit applications became available the market just as we are starting For a city that often excels and online but were still accompanied to see rental rates increase and leads the way, this is an area where by the age-old requirement of a significant new product is about to we’ve fallen behind. walk-in submission process. Bring- come on-line. Maybe more impor- ing the permit submission process tantly, from a macro level, if US The focus of the incoming mayor’s online as well as payments (the Steel left the CBD it would be a office should address this dilemma city should devise a transaction fee blow to the identity of our City. A which would improve far more in to cover their costs) will minimize significant move out of the CBD our city than just the transporta- paperwork and help streamline the by a cornerstone of the Pittsburgh tion headache. The answer won’t overall turnaround for approval. economy could potentially create be simple or cheap, but as the ad- Simplifying the permit application doubt in the revitalization of down- age goes, 'it takes money to make bank of the DCP’s major depart- town. money'. Imagine the economic im- ments and tracking permit applica- pact possibilities. With reliable and tions online would be a huge plus. Accomplishment #1B would be to readily available transportation op- relocate the bus transfers out of tions, the regular 'burb-to-'burgh To their credit, the DCP has done a the CBD to reduce pedestrian con- commuter's transportation costs fantastic job with fast-tracking the gestion and traffic. This would al- drop significantly. The idea of elim- approval of small commercial proj- low people that are either working inating parking fees and reducing ects (SCPR) and accepting walk- or visiting downtown conduct their maintenance and fuel expenses for through permitting weekly. business easier and attract more personal vehicles increases the like- visitors to the area. lihood that consumers will spend Less turnaround time and process that money elsewhere (especially if inefficiencies means more time for they have a safe, cheap way to get building our city. To that I think we there). And, on top of the "green" could all say, amen. being spent at area businesses, an increased use of public transportation falls in line with the sustainable endeavors we've pioneered such as the Pittsburgh 2030 District mission.

We are proud of our many accomplishments that have improved our world and the world around us. Let us continue to raise the bar. Let us continue to be a city of champions.

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Armstrong County Industrial De- velopment Council (ACIDC) sold several lots within their industrial parks, leased space within their new multi-tenant facility, provided financing assistance and borrowed state funds to make pad-ready sites.

Metal Solutions, Inc. received a Small Business First loan to construct a new 12,350 square foot building. The business will be located in southern Arm- strong County in the Parks Bend Farms Industrial Park. Projectile Tube Cleaning, Inc. purchased a lot in the Manor Township Armstrong County Business Park to construct a 9,000 square foot building, and Armstrong County several properties have been Armstrong County Department of optioned and are expected to Economic Development close in the coming months. Northpointe Technology Center Center II Earlier this year, the ACIDC ini- 187 Northpointe Boulevard tiated the first of two major site Freeport, PA 16229 improvement projects at North- 724-548-1500 (T) 724-545-6055 (F) pointe. The first site improve- Michael Coonley, Executive Director ment project, which consists of [email protected] the development of 42 pad- www.armstrongidc.or ready acres, began earlier this year and will be completed in The first half of 2013 was suc- September 2013. The sites are cessful for Armstrong County. The designated for office and light

www.developingpittsburgh.com 73 For winning results, turn to a Armstrong County (continued) industrial development with finished team with proven performance. grades at approximately 1%. The pad-ready lots, ranging from 2 acres to 20 acres, will also be included in a Keystone Opportunity Expansion Zone application.

The second site improvement project will commence in early 2014 and will include more pad ready development at Northpointe. The project scope will include the extension MB&M Law Teams: of infrastructure and grading of the Real Estate Labor & Employment unoccupied retail acreage at North- Construction School & Municipal pointe. The ACIDC will solicit pro- Business posals from retail developers during Litigation the fourth quarter of 2013 with the Banking & Finance Estate Planning intent of partnering to complete the project. This property will also be included in the Keystone Opportu- Call 412-242-4400 nity Expansion Zone application.

For additional information about the ACIDC, please view our listing in the Buyer’s Guide. Pittsburgh south side Works Wexford mbm-law.net Beaver County Elmhurst 4.75 x 4.75_Final NAIOP ad 2/20/13 2:53 PM Page 1 Beaver County Corporation for Economic Development 250 Insurance Street, Suite 300 Beaver, PA 15009 724-728-8610 (T) 724-728-3666 (F) James Palmer, President [email protected] www.beavercountyced.org

In May 2013, the Beaver County Cor- poration for Economic Development The Elmhurst Group. (CED) began an $800,000+ earth- moving project as part of its contin- Woven into the fabric of Pittsburgh. ued expansion of the Hopewell Busi- ness and Industrial Park, located at Whether it’s locating space in one of our existing commercial buildings, or Exit 48 of Interstate-376. The project developing an entire turnkey office community from a clean sheet of paper— as we did with Airside Business Park— Elmhurst Group involves moving more than 200,000 can accommodate virtually any commercial real estate need. cubic yards of earth as part of creating an additional 15 acres at the site. We manage every building we own. We maintain close personal contact with our clients. To date, the Hopewell project has We operate with the understanding that we are in the service business— become home to ten projects employ- not the space business. We recognize that our legacy is inextricably linked to ing over 1,500. Currently all improved the quality of our people and the service we provide, so we conduct our business with integrity, and honor our commitments. property at the site is either sold or under agreement. For more than 30 years, Elmhurst Group has been a part of the Greater Pittsburgh region. And in order to remain, we know that our deeds always need to back our words. Loan activity was brisk during the first half of 2013. CED approved: equipment loans for four manufacturing projects; $700,000 in direct loans from its Business Development w w w. e l m h u r s t g r p . c o m M 4 1 2 . 2 8 1 . 8 7 3 1 Fund; and more than $500,000 in its

74 DEVELOPINGPITTSBURGH | Fall 2013 capacity as a conduit lender through the Commonwealth of Pennsylva- nia’s Small Business First Program, for the projects. It is estimated that the projects will create 50+ jobs and retain an additional 90 jobs with total capital investment of more than $3,000,000.

Finally, it was announced that VEKA, Inc., a manufacturer of vinyl doors and windows, will invest $6 million in capital improvements and employ an additional 38 people at its Marion Township plant. CED was involved in obtaining financing and constructing a portion of the infrastructure necessary for the company to build its initial facility in Marion Township, Beaver County. The project will help retain the 350 jobs that currently exist at the site.

Butler County Community Development Corporation of Butler County 112 Woody Drive Butler, PA 16001 724-283-1961 (T) 724-283 3599 (F) Ken Raybuck, Executive Director [email protected] www.butlercountycdc.com

The purchase by Yeltrah, LLC of the Trinity Building located at 140 Hol- lywood Drive in the Pullman Center Business Park Expansion has taken place. The Community Development Corporation of Butler County (CDC) is currently working with Johnstone Sup- Since 1958 ply, the new owner of the building, to complete the buildout. It is anticipat- Desmone & Associates ed that Johnstone Supply will have a grand opening at the facility this fall. Architects A local fraternal organization is in the Architecture • Planning • Interior Design process of purchasing a two-acre parcel that will house their new building 3400 Butler Street • Pittsburgh, PA 15201 at the Pullman Center Business Park 412.683.3230 • www.desmone.com Expansion. Additional details will be announced once the sale is finalized.

The CDC is also working with a manufacturer to finalize a sale at the Vic- tory Road Business Park. The business manufactures actuators for use on the locks and dams that are found on the many rivers in Western PA.

www.developingpittsburgh.com 75 Butler County (continued)

Available now, the CDC has: 3,600 Park which has a KOZ designation Contact the CDC at 1 (800) 283- square feet of first floor office through December 31, 2017; 30 0021 if you have are looking for space available for lease at the acres of land at the Pullman Center office or flex space or shovel-ready Pullman Commerce Center; 3,400 Business Park Expansion. The Pull- land in Butler County. square feet for sale or lease at man site includes rail access and the Bantam Commons; 40 acres of is located in the City of Butler and land at the Victory Road Business Butler Township.

to house the Army Reserve 401 made to consolidate operations of

Fayette County Medium Truck Company under the their two existing buildings, com- Fay-Penn Economic Development USAR’s Grow the Army initiative. prising a total of 121,000 square Council The new unit would be part of the feet, in the Uniontown area into 1040 Eberly Way, Suite 200 Army’s Combat Service Support one facility. Lemont Furnace, PA 15456 Reset Initiative to support new 724-437-7913 (T) 724-437-7315 (F) brigade combat teams. The new facility will house almost Michael A. Jordan, Jr., $2 million worth of new produc- Executive Director Plans for the new center include a tion equipment that will allow the [email protected] 30,000 square foot training facil- business to grow and plans for www.faypenn.org ity, a 4,800 square foot mainte- future purchases of new, cutting- nance building and a storage site edge equipment have already During the first half of 2013, that will provide administrative, begun. Fay-Penn Economic Development educational, assembly, library, Council (Fay-Penn) continued learning center, vault, weapons Fay-Penn Economic Development to see a tremendous amount of simulator and physical fitness ar- Council, along with Washington growth from Fayette County busi- eas for the unit. The USAR would Financial Corporation and the nesses as well as an increase in in- employ one full-time employee Department of Community & Eco- terest from businesses potentially during the week and support train- nomic Development provided the relocating to the area. ing of approximately 150 reservists financing for Gerome’s new build- on training weekends. ing and new manufacturing equip- The U. S. Army Reserves (USAR) ment. purchased approximately 20 acres Gerome Manufacturing held a in the Fayette Business Park, groundbreaking for their new $9 Gerome currently employs approxi- Smithfield, Georges Township for million, 150,000 square foot facil- mately 100 people and anticipates a new Reserves center in Fayette ity in the Fayette Business Park in eventually adding an additional County. The construction of the June. Gerome Manufacturing Com- 20 to 25 employees. The plant in estimated $11.8 million project pany has become a well-known the Fayette Business Park will be is anticipated to serve 150-mem- producer of custom precision sheet operational by early Spring 2014. ber reservists from Pennsylvania, metal products serving both East Maryland and West Virginia. This and West Coast clients as well as state-of-the-art center is expected foreign markets. The decision was

Development, celebrated its 56th square foot building in EverGreene

Greene County year of service to Greene County Technology Park. Like RG Johnson, Greene County Industrial this past February in business park a second coal mine related com- development and business financ- pany, Irwin Car & Equipment will Developments, Inc. ing. The organization owns and soon call EverGreene home with 300 EverGreene Drive manages the 248 acre EverGreene their purchase of a 2 acre parcel. Waynesburg, PA 15370 Technology Park in Waynesburg Additionally several land sales 724-852-2965 (T) and the 72 acre Paisley Industrial have been approved for both parks 724-852-4132 (F) Park in Carmichaels. with closings scheduled for the Don Chappel, Executive Director coming months. Recently Paisley Park has seen Stal- [email protected] lion Oilfield Services construct a EverGreene has 30 acres of pad- www.gcidc.org new building on the 10 acre parcel ready acreage available for imme- they acquired in 2012 and this diate development while Paisley County Industrial Developments, spring RG Johnson Co., Inc. began Park has 15 acres readily available. Inc., dba Greene Alliance for construction of a new 37,000

76 DEVELOPINGPITTSBURGH | Fall 2013 Indiana County Indiana County Center for Economic Operations 801 Water Street Indiana, PA 15701 724-465-2662 (T) 724-465-3150 (F) Byron G. Stauffer, Jr., Executive Director [email protected] www.indianacountyceo.com

Two new business parks are under development in Indiana County. They will add more than 20 new business sites, totaling about 155 acres of new shovel-ready pads.

The Windy Ridge Business & Technol- ogy Park is underway, with construction of a 95,000 square foot building for Creps United Publications. Pre- liminary work is also underway on the second phase of the new park, which is located at the intersection of US 422 and SR 286 in White Township. Windy Ridge will be a premier park featuring a mix of commercial and light industrial sites with a broad array of ameni- ties.

The 119 Business Park is located along US 119 in Center Township and will Colliers International | Pittsburgh feature 3 to 5 pad-ready sites rang- specializes in adding value to our ing from 3.5 to 8 acres. Construction of road and utility infrastructure will clients to accelerate their success. begin in August and final paving and landscaping will be completed in 2014.

Three hotel projects are also moving forward. A new 82-room “select service” hotel will be constructed near the intersection of US 422 and SR 286. A boutique hotel is also being planned in downtown Indiana, featuring 47 up- scale guest rooms and meeting rooms with intimate character. A 120+ room hotel adjacent to the Kovalchick Con- vention & Athletic Complex at Indiana University of Pennsylavania is also in final planning stages.

Two new restaurants are also opening Commercial Real Estate Sales and Leasing Services in downtown Indiana. The Blackhorse > Real Estate Management > Valuation and Advisory Steakhouse, a farm-to-table style res- > Corporate Solutions > Investment taurant is opening in the newly reno- vated Brown Hotel, and Tazé, a Medi- > Sustainability > Auctions terranean Ristorante, is opening in the 412 321 4200 | www.colliers.com | @PghCRE historic train station. Learn how we are living our values of service, expertise, community and fun at www.colliersinternationalpittsburgh.com

www.developingpittsburgh.com 77 Interstate 376 with direct access to dustry and is enclosing its activities. Lawrence County Pittsburgh, Youngstown and Hermit- There are currently 10 jobs at the Lawrence County Economic age. site and 7 additional jobs are be- Development Corporation ing projected. The LCEDC working 100 East Reynolds Street These four projects represent $13 with the PA Dept of Community and Plaza South, Suite 100 million of new investment and create Economic Development obtained a New Castle, PA 16101 132 new jobs in the community: Pennsylvania Industrial Development 724-658-1488 (T) 724-658-0313 (F) Upstate Shredding – Upstate Shred- Authority Loan to assist with the Linda Nitch, Executive Director ding/Weitsman Recycling of Owego, financing of the project. [email protected] NY purchased the former Ferrotech www.lawrencecounty.com recycling facility on Moravia Street Magnetic Lifting Technologies is in New Castle. This is a $6 million relocating from Ohio to Neshannock The Lawrence County Economic project which includes demolition Business Park. The project consists Development Corporation is now of the existing structures, construc- of the purchase of 4 acres of land ready to lease its 50,000 square foot tion of 33,000 square feet of ware- with the construction of a 40,000 single tenant or multi-tenant build- house and office space. Additionally square foot facility. Fifteen new jobs ing. With construction expected to a state-of-the-art shredder will be are being created with an additional be completed in September 2013 installed. The project is completing five proposed. The LCEDC provided this facility offers 45,000 square feet the permitting process and is expect- assistance by working with the of total manufacturing/warehousing ed to create 30 new positions. Governor’s Action Team to provide space with 5,000 square feet of of- Pennsylvania Industrial Development fice space sitting on five acres. The RW Elliott expansion – RWE Hold- Authority financing for this $2.3 mil- ceiling height to eave is 25' and to ing is constructing a 30,000 square lion project. The company expects the center of the roof is 31'. The foot processing facility at their site to break ground in September. building is located in a Pennsylva- located in Taylor Township with total nia Keystone Opportunity Tax Free project cost estimated at $1.2 mil- Portersville Valve is relocating from Zone I Millennium Park adjacent to lion. The company processes carbon, Portersville, Butler County, PA to graphite and coke for the steel in- Shenango Township. The company

78 DEVELOPINGPITTSBURGH | Fall 2013 has purchased 23 acres along Route million project that should be com- er 25 proposed. The LCEDC again 422 east including the former pleted in 2014. New jobs to Law- provided project assistance working Shenango Bowl-away. This a $4.3 rence County will be 50 with anoth- the Governor’s Action Team.

printing service so company names, logos building with the ability to add another Washington County or slogans can be printed or embroi- 15,000 square feet. The company expects Washington County Economic dered on a variety of products. The new to begin construction as soon as it re- Development Partnership building is being constructed by General ceives permits. 20 East Beau Street Industries of Charleroi and is expected to Washington, PA 15301 be completed in October. Fletcher Industries, which specializes in 724-225-3010 (T) 724-228-7337 (F) wiring control panels for manufacturers Jeff Kotula, President Also, the Washington County Commis- in the United States and overseas, moved [email protected] sioners approved the sale of property into a new 20,000-square-foot site at www.washingtoncountyworks.com in the Starpointe Business Park, Ha- 200 Woodcliff Drive in Southpointe II. nover Township, to Lifting Gear Hire, The company was assisted by the Wash- Gallaway Safety & Supply (GSS) held an Illinois-based firm that is the largest ington County Chamber of Commerce groundbreaking ceremonies recently for company in the country devoted exclu- and the Washington County Authority a 27,000-square-foot office and ware- sively to the rental, sale and service of with the site selection.was successful house building in Eighty Four, which will lifting, winching and material handling in securing a Redevelopment Assistance serve as the company’s new corporate equipment. The sale price is $188,500 Capital Program grant of $1.5 million headquarters. GSS has been in business for the 3.1 acres with usable acreage to aid the development of the park’s since 2000 and offers a vast inventory expected to 2.9 acres. The company will next phase. Fourth River Development is of safety and supply items. Its inventory be opening within 10 to 12 months in currently in the planning stages of Flex includes safety, industrial and janitorial Lot 11 in the first phase of Starpointe. It Building 3, a 60,000 sq. ft. spec building supplies. GSS also offers a custom im- will initially have a 25,000-square-foot to be built later in 2013.

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www.developingpittsburgh.com 79 Westmoreland County Westmoreland County Industrial Development Corporation 40 North Pennsylvania Avenue, Suite 520 Greensburg, PA 15601 724-830-3061 (T) 724-830-3611 (F) Jason W. Rigone, Executive Director [email protected] www.co.westmoreland.pa.us

Property Valuation The new 73,500-square-foot Advanced Technology Center will be distinctly located within the county’s 2.8 million square-foot RIDC Westmoreland (former Sony facility) in East Huntingdon Township, one of the largest multi-tenant facilities in eastern United States. WCCC anticipates the center will be completed and open for classes beginning Fall of 2014.

In addition to Aquion Energy gearing up for production of its first full-scale manufacturing facility at the RIDC Westmoreland complex by year’s end, DNP (Dai Nippon Printing) recently added 26,000-square-feet to support a new product line increasing its space to almost 161,000-square-feet. DNP produces spools of thermo-transfer ribbon strips used on the back of Property Valuation credit cards and operates three shifts per day. “The location of the new Advanced Technology Center is significant in that it will thrive amongst industry,” said Jason Rigone, Executive Director of the Westmoreland County Industrial Development Corporation. “Not only will it will be an incentive for new employers who have a need for specialized programs to relocate here, but it will also be an asset to the existing businesses in this regional employment center.”

Some other major developments in the county include:

Litigation Support • A 75,000-square-foot flex-warehouse under construction at Westmoreland Airpark by EFR Limited Partnership in Latrobe. Phase II construction underway at the Westmoreland Integra Realty Resources - Pittsburgh Airpark opening up an additional 52 acres of developed property crucial for new and expand- Over 135 years of experience providing commercial real ing businesses in the region. estate appraisals, market and feasibility studies, impact • Arnold Palmer Regional Airport in Unity con- studies, litigation support and consulting throughout structing an additional 250 parking spaces. Western Pennsylvania and West Virginia. In addition, with 65 offices across the United States, we provide a national • WCCC breaking ground on an $8.4 mil- platform to solve your valuation challenges. lion 30,000-square-foot education center in Latrobe.

Paul D. Griffith, MAI, CRE, FRICS • Seton Hill University breaking ground on an $11 Managing Director million 46,000-square-foot dance and visual arts center in Greensburg. T: 724.742.3324 F: 724.742.3390 [email protected] www.irr.com/pittsburgh

80 DEVELOPINGPITTSBURGH | Fall 2013 NEW

In addition to the above construction activities, Westmoreland County’s brownfield redeveloped sites have shown some promising movement in- TM cluding the 26,000-square-foot lease extension for Glassautomatic, a 1,200-square-foot reloca- BY BURNS & SCALO tion of the Mount Pleasant Glass Museum at the Mount Pleasant Glass Centre in Mount Pleasant, MANAGE ALL OF YOUR ROOFS 17,182-square-feet of short-term lease area for FROM THE PALM OF YOUR HAND Forest Hills Transfer and 20,000-square-feet of space for Stellar Precision Components, both at the Jeannette Industrial Park in the City of Jean- nette.

Information on these and many more sites located throughout the county can be found on the county’s website at www.westmorelandcountyidc.org or by call- 1 ing Joseph D. Sisley, Marketing Director of the West- moreland County Industrial Development Corporation – (724) 830-3061. DP

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www.developingpittsburgh.com 81

People & Events

(Left-to-right) Moderator Randy Cornelius from First (left-to-right) Allen & Shariff's Paul Messineo Jr. with Sean Niagara with panelists Mike Thomas of PNC, HFF’s Claudia Walters of W Group Holdings and Jim Droney from Mt. Steeb and Jack Shelly from Dollar Bank at the May 16, Lebanon Office Equipment at the May 21 NAIOP Pittsburgh/ NAIOP Pittsburgh meeting. MBA ‘One Project – One Team’ seminar on collaboration.

(From left) Continental Building’s Carl Belli with Todd Sharon Landau and Anderson Interiors’ Bob Dezort Anderson and Joe Scalise of EMCOR/Scalise Industries. at the CREW golf outing.

www.developingpittsburgh.com 83 Completely Furnished Move In Ready Space for $25/RSF …Installed!™

(From left) Pentrust’s Tyler Noland, Amy Brocato from Langholz Wilson Ellis, Clayco’s Scott Caplan, Matt Smith from Red Swing and Babst Calland’s Matt Jameson at the NAIOP Pittsburgh golf outing at Laurel Valley.

MOBILI, Pittsburgh’s leading modular architectural interiors provider, has partnered with MAI to create the industry’s most innovative products and service program. Our turnkey program includes: • Glass Walls • Systems Furniture • Modular Desks • Office Seating • Voice & Data Cabling • Carpet Tiles ® • LEED Compliant Products Panelists at NAIOP Pittsburgh's July 18 program on down- • GREENGUARD® Certified town were Michael Sriprasert from Landmarks Commu- nity Capital Corporation, Arthur Ziegler from Pittsburgh History & Landmarks Foundation, Strada’s Ed Shriver, Izzy Rudolph of McKnight Realty Partners and moderator Contact Us Today to Learn More! Pierce Richardson of K & L Gates.

[email protected] 412 281 6090

84 DEVELOPINGPITTSBURGH | Fall 2013 Representing Grandridge Real Estate Capital at the clay shoot are NAIOP Pittsburgh president Dan Puntil and Megan Zillweger Jones.

Action Housing’s Jennifer DiNardo takes aim at the CREW clay shoot.

www.developingpittsburgh.com 85 BUILDING A BETTER FUTURE 412-462-4371 WWW.FRANJOCONSTRUCTION.COM DEVELOPINGPittsburgh

2013 Buyer’s Guide!

LOOKING FOR AN

ARCHITECT, ENGINEER, CONTRACTOR OR LENDER? THE 2013 NAIOP BUYER’S GUIDE LISTS DOZENS OF FIRMS FROM Coming to Southpointe in Spring 2014 AROUND THE REGION THAT CAN FIT THE BILL. Architect...... 87 Civil Engineer...... 87 Construction Consultant...... 88 Consultant...... 88 Contractor...... 88 Developer...... 89 Document Handling ...... 89 Economic Development...... 90 Engineer...... 90 Environmental...... 90 Finance...... 91 Geotechnical Engineer...... 91 Green Building/Energy Consultant...91 Industry/Trade Association...... 91 Interior Designer...... 91 Land Surveyor...... 91 Landscape Architect...... 92

contact gilbane area manager Maintenance/Service Contractor...... 92 allison stawarz to learn more Professional Services...... 92 Real Estate Broker...... 92

86 DEVELOPINGPITTSBURGH | Fall 2013 Architect Front Studio Architects RSH Architects 357 N. Craig Street 363 Vanadium Road #200 Pittsburgh PA 15213 Pittsburgh PA 15243 T: 412-682-2121 T: 412.429.1555 x 19 www.frontstudio.com F: 412.279.7285 Art Lubetz IDC Architects www.rsharc.com Astorino [email protected] Five Penn Center West Suite 300 Joel C. Cluskey, AIA, CCS 227 Fort Pitt Boulevard Pittsburgh, PA 15276 Front Studio’s architecture is experientially powerful [email protected] Pittsburgh, PA 15222 T: 412-848-2275 x44576 and environmentally responsive. For 45 years, we RSH Architects celebrates its fourth decade of profes- T: 412-765-1700 Gary Homonai have taken a creative approach to architecture, work- www.astorino.com Business Development Director, NE Region sional practice with renewed ownership, enthusiasm, ing closely with our clients to meet their occupancy, John D. Francona, RA, LEED AP [email protected] and a commitment to quality architecture that environmental and budgetary needs. Our work uses [email protected] www.idcarchitects.com endures - aesthetically, functionally and environmen- provocative yet economical materials to produce tally. RSH Architects serves diverse clientele within At Astorino, we believe that great design meets the IDC Architects is a multidisciplinary planning and de- fresh and unique solutions. With an emphasis on col- a variety of markets which include colleges and deepest needs of the people who live, learn, heal, sign firm with over 20 years of experience in advanced laboration and flexibility, and our ability to innovate universities, financial institutions, housing, municipal work and play in the environments we create. It’s technology and mission critical design. Ranked by and adapt, Front Studio has a distinct reputation for governments, and high technology manufacturing. that simple. For over 40 years, Astorino has been at Architectural Record as one of the world’s leading excellence. the forefront of where people and design intersect. A design firms, we are a team of architects, engineers full-service company, Astorino combines architectural, and construction managers who believe that value engineering, construction and interior design solu- begins with a harmonious relationship between client tions with unprecedented human-centered research and design team. From iconic exteriors to optimized to provide one seamless delivery process. We leverage building systems, value pays dividends over time. We our creative foundation, interdisciplinary expertise combine 3D visualization tools, airflow modeling, and and strong collaborative approach to impact the sustainable solutions to generate innovative design greater good...to design for the future...and to re- Gerard Associates Architects, L.L.C. and engineering solutions for facilities of the future. imagine landscapes. 1601 Arrott Building 401 Wood Street VEBH Architects Pittsburgh, PA 15222-1838 470 Washington Road T: 412-566-1531 Pittsburgh, PA 15228 www.gerardassociatesarchitects.com T: 412-561-7117 Dawn Danyo DiMedio, AIA, LEED AP BD+C www.vebh.com [email protected] Contact: Daniel Skrabski A Woman Owned Business providing architecture, [email protected] planning, interior and environmentally responsible VEBH Architects has been serving the communities of Design 3 Architecture PC design services to a full range of commercial clients IKM Incorporated Southwestern Pennsylvania and beyond for more than 300 Oxford Dr. Ste. 120 since 1959. The firm commits itself to understanding One PPG Place 65 years. We are passionate about creating quality en- Monroeville, PA 15146 projects completely, developing working relationships Pittsburgh, PA 15222 vironments for our clients. Our designs for workplaces enhance client identity, offer increased productivity, T: 412-373-2220 with clients and delivering projects that are techni- T: 412-281-1337 and deliver long-term value to a business, as well www.d3a.com cally and aesthetically complete. Every project is given F: 412-281-4639 as the customers and the community it serves. We William Snyder principal attention. We believe this commitment to www.ikminc.com [email protected] service yields superior design. are committed to creating great places that inspire, Joel R. Bernard, AIA, NCARB, LEED AP motivate, and ultimately enrich our region and the Design 3 Architecture has been offeringarchitecture, Principal communities in and around the places we call home. planning, and interior design services to the Pitts- [email protected] burgh region since 1982. We view inherent project IKM Incorporated has been providing architecture, constraints as potential opportunities for innovative planning and interior design services to corporate and design solutions. With a philosophy grounded in team institutional clients for 100-years. IKM’s mission is to collaboration, providing both personal attention and provide innovative and informed architecture that Civil Engineer project leadership, Design 3 Architecture does more positively impacts the world through leadership in than solve problems. We provide solutions that are understanding, exploration and decision making. IKM unique, exciting and affordable. is a member of the American Institute of Architects HHSDR Architects / Engineers and the US Green Building Council. 40 Shenango Avenue Sharon, PA 16146-1502 130 7th Street, 201 Century Bldg. Pittsburgh, PA 15222-3413 GAI Consultants, Inc. T:800-447-3799 385 E. Waterfront Drive DRS Architects, Inc. T: 412-281-2280 One Gateway Center, Seventeenth Floor Homestead, PA 15120 F: 724-981-4515 T: 412-476-2000 Pittsburgh, PA 15222 www.hhsdr.com T: 412-391-4850 Renaissance 3 Architects, P.C. www.gaiconsultants.com Frank Gargiulo Patrick M. Gallagher F: 412-391-4815 [email protected] 48 South 14th Street www.drsarchitects.com Pittsburgh, PA 15203 [email protected] HHSDR has been building relationships with our Kathryn A. Jolley, MBA, ASID, LEED AP T: 412-431-2480 Transforming ideas into reality for over 50 years, GAI’s clients since 1953. Specializing in the adaptive reuse [email protected] www.r3a.com teams of real estate and economic counselors, urban of facilities for education and training, commerce, Deepak Wadhwani planners, engineers, environmental specialists, sur- Designing for the future, DRS Architects continues to and government, we have designed for sustain- provide innovative and creative architectural solutions [email protected] veyors, and landscape architects provide innovative, ability since the 1980s. HHSDR has completed practical, and cost-effective solutions for all stages of as we have for more than 50 years. We listen carefully LEED-certified projects in Allegheny and Mercer At R3A we believe that successful design shapes to our clients’ needs and develop customized respons- environments that actively engage the senses and land development. Our award-winning land develop- counties. For several years, we have been ranked by ment portfolio includes large multi-use complexes, es to each design challenge. We provide architecture, the Pittsburgh Builders Exchange as the most active facilitate positive human interactions and behaviors, interior design and master planning services through while employing technologies that help improve the retail centers, healthcare and educational campuses, firm in the tri-state region. We’ve earned that ranking residential communities, urban streetscapes, parks the varied markets of higher education, laboratories, by providing high-quality and responsive service to performance of our daily lives. R3A is a 17-person firm health and wellness, government, hospitality, and with three principals supported by an experienced and trails, marinas, and resorts. Distinguished in our clients. Our project portfolio includes projects our commitment to urban-infill, Greenfield, and corporate offices. Our talented design teams work to sized from a few hundred to 400,000 square feet. and creative team of architects, interior designers and develop exemplary projects which enrich daily life, project managers. R3A provides a full range of archi- brownfield development, we help clients achieve their improve communities, advance a sustainable future tectural, interior design, planning services. We pride project goals. GAI brings projects from ideas to reality. and promote design excellence. ourselves in being uniquely qualified to respond to the Learn more at www.gaiconsultants.com. increasingly diverse and complex facilities needs of our clients and their organizations.

www.developingpittsburgh.com 87 Contractor

The Gateway Engineers 400 Holiday Drive, Suite 300 Pittsburgh PA 15220 RCx Building Diagnostics T: 412-921-4030 Red Swing Group 210 Fifth Street A. Martini & Company F: 412-9219960 4154 Old William Penn Hwy 320 Grant Street Charleroi, PA 15022 www.gatewayengineers.com Suite 300 Verona PA 15137 T: 866-382-8628 Ryan L. Hayes, Director of Business Murrysville, PA 15668 T: 412-828-5500 Web: www.RCxBD.com Development T: 724.325.1215 www.amartinigc.com Contact: Peter Arnoldt, LEED GA [email protected] F: 866.295.5226 Emily Landerman Email: [email protected] The Gateway Engineers, Inc. and its predecessors have www.RedSwingGroup.com [email protected] RCx Building Diagnostics' certified engineers and con- played an active role in the development of the Ohio Matthew Smith Established in 1951, A. Martini & Co. is not just a sultants are dedicated advocates of environmentally Valley since 1882. Our incessant pursuit of project [email protected] general contracting and construction management management excellence has created strengths in mu- Red Swing Consulting Services views its clients as and fiscally smart buildings. Setting out to improve firm – it is a family business that embodies the dedica- nicipal engineering, consulting work, and all facets of partners focusing first and foremost on building and the existing building stock isn't just a side project: it's tion, work ethic and talent of three generations of private development including the burgeoning energy maintaining strong relationships. Mutual trust from what we do. Our mission is to provide commercial the Martini family. A. Martini & Co.’s size, history and industries. The tradition of providing value-added engi- these relationships is the foundation of solid business building owners and operators with independent, work philosophy are specifically geared to offering neering solutions carries on as the company continues partnerships. Red Swing offers complete land develop- 3rd-party services empowering them with the tools, experience, commitment and a partnering approach. to grow. Gateway’s staff of registered professional en- ment consulting services to take a project from concept knowledge and expertise necessary to maximize the A. Martini & Co. provides construction management gineers, surveyors, construction inspectors, and land- through construction. Red Swing possesses experience level of efficiency and performance possible within and general construction services for multimillion scape architects, along with qualified technicians, is in land development, infrastructure, utility, environ- their current design and resource constraints. dollar and smaller projects for industry, retail, medical, ready to provide the expertise and personalized service mental and communication projects. Red Swing ef- Our services include: Energy Audits, Retrocommission- entertainment, corporate, residential, education and which every project deserves. For more information, fectively maximizes the return on investment through ing, Sustainability Consulting, Building Certification non-profit clients. please visit www.gatewayengineers.com a collaborative design approach, utilizing a low impact Assistance (i.e. LEED®, EnergyStar®, etc.), and Retrofit design philosophy that reduces project capital costs Project Management. and produces the competitive edge that we and our partners demand. Consultant

Construction Consultant Burchick Construction Company Inc. 500 Lowries Run Road Pennoni Associates Inc. Pittsburgh PA 15237 700 Seco Road T: 412-369-9700 Monroeville PA 15146 www.burchick.com T: (412) 229-2778 Joseph E. Burchick www.pennoni.com RRC Consulting Group, Inc. [email protected] John Skorupan 100 W Station Square Drive, #1910 Pittsburgh PA 15219 Burchick Construction is a full-service general contrac- [email protected] Campayno Consulting Services, tor founded on the commitment to excellence that Joe Pennoni Associates is a multi-disciplined consulting LLC T: 412-364-3035 www.rrcconsulting.com Burchick brings to each project the company under- engineering and design firm employing 900 profes- P.O. Box 554 Angela Alfonso takes. Burchick’s management approach is designed sional, technical, and administrative personnel with Oakmont, PA 15139 412-651-9333 to ensure optimum results for our clients, setting the 28 offices throughout the eastern United States. Pen- T: (412) 794-8129 noni, an ESOP company, offers services in Site Design, [email protected] performance standard for construction services. Our F: (412) 794-8130 Landscape Architecture, Environmental, Health and executives and managers have broad-based experience www.campaynoconsulting.com RRC Consulting Group (RRC) provides Facilities Support delivering construction to the highest standards, re- Safety, Indoor Air Quality, Surveying, Transportation, Services, Environmental Consulting, and Environmental Land Development, Construction Inspection and Test- Jesse C. Campayno gardless of the client’s preference for delivery method. T: 412-302-0035 Health Services for Commercial, Public, Industrial, and Burchick’s project team and professional engineers ing, MEP, Geotechnical, Underwater Inspection, and Residential properties coast-to-coast. Services include: Structural Engineering. Locally, Pennoni has offices [email protected] on staff are equally comfortable with a completed located in State College, Monroeville and Uniontown Campayno Consulting provides construction consult- • Maintenance Operations Management design or with providing pre-construction assistance that service the developer, building owner, industrial, ing services for owners and developers who need • Asset Management at the earliest stages of design. Burchick has managed transportation, education, government, and Marcellus assistance managing the complex contractual relation- • Energy Audits commercial, industrial and institutional projects from Shale industries in western Pennsylvania, West Virginia, ships between their contractor and architect. Jesse • Facility Condition Assessments $100,000 to $73 million with equal attention. Burchick and Ohio. Campayno has more than 37 years of experience in • Building Forensics/Thermography Construction, setting the performance standard. field and executive positions, giving him insight into • Life-Cycle Analysis the best practices of project management. Campayno • Operational Readiness focuses on five core services: Owner representation and • Infrastructure construction management; estimating and conceptual • Phase I & Phase II Assessments budgeting; project executive services; dispute resolu- • Environmental Engineering tion and business consulting. Our clients rely on our • Project Management EMCOR/Scalise Industries expertise to add value to their projects by providing • Construction Inspections 108 Commerce Blvd. Suite A clear direction, maintaining open lines of communica- • Building Commissioning Lawrence, PA 15055 tion and placing the project owner’s goals as the top • Electrical Contractors T: 724-746-5400 • Site Preparation/Demolition priority. F: 724-746-5410 • Environmental Site Assessments Joe Scalise • Regulatory Compliance [email protected] • Environmental Health Management Solutions www.scaliseindustries.com • Indoor Air Quality Assessments EMCOR Services Scalise Industries is a single source • Mold Assessments and Remediation Plans provider of Mechanical, Electrical and Fire Protection • Environmental Training Services Construction Services to commercial and institutional • Asbestos Inspections/Lead Assessments clients. From service and maintenance solutions to complex construction projects, the Scalise Industries team utilizes our extensive resources to enable integrated workflow solutions. We deliver superior service through our 65+ years of facilities expertise and trade knowledge, and continuously implement new technologies to construct quality products and enhance value for customers. A part of EMCOR Group, our local expertise is backed by the resources of a Fortune 500 organization. What can we do for you?

88 DEVELOPINGPITTSBURGH | Fall 2013 Document Handling Nello Construction Company 100 Houston Square #200 Restoring the Past Building the Future Canonsburg, PA 15317 Jendoco Construction Corporation T: 724-746-1900 Volpatt Construction F: 724-746-7032 2000 Lincoln Road 100 Castleview Road www.nellloconstruction.com Pittsburgh PA 15235 Pittsburgh PA 15234 Billy Hinton T: 412-361-4500 T: 412-942-0200 [email protected] F: 412-361-4790 F: 412-942-0280 www.jendoco.com We bring enthusiasm as well as sophistication to both www.volpatt.com Multiscope Document Solutions Domenic Dozzi small and large-scale projects. Our team has designed, Ray Volpatt Jr. 135 Technology Drive managed, built, and collaborated on new builds, Canonsburg, PA 15317 [email protected] [email protected] renovations, historic restorations, build-outs, and ten- T: 724-743-1083 Located in Pittsburgh for over 50 years, Jendoco has Volpatt Construction, a General Contractor/Construc- built a reputation for being a premier quality general ant improvements. We’re passionate about working F: 888-515-7120 alongside schools, ministries & non-profits, real estate tion Manager who specializes in new construction, www.multiscope1.com contractor and construction manager with expertise renovation, and restoration has successfully positioned in many facets of building construction. From renova- developers, municipalities, restaurants, banks, auto Douglas Beck, Managing Partner itself as one of the most respected building contractors [email protected] tions, to restorations, to new construction, our team dealerships, hotels, and industrial clients. in the Western Pennsylvania Tri-State area. From one At Multiscope Document Solutions, we deliver of seasoned professionals has the experience and small laboratory renovation at the University of Pitts- state-of-the-art document, paperless and hardware commitment to meet the challenges of your projects. burgh to more than 500 commercial, institutional and technology solutions to organizations nationwide. We have experience with new construction, renova- industrial projects, Volpatt Construction has developed We are dedicated to helping our customers create ef- tion, historical restoration and preservation, research a focus on high quality, hands-on service, competitive ficiency, improve productivity and add to their bottom facilities, hospitals and medical facilities, schools and pricing, and timely project completion which has lines with document solutions tailored to their needs. universities, religious facilities, water treatment facili- helped them build a long list of repeat clients. For Our award-winning services are custom-designed ties, multi-tenant residential, commercial, industrial, more information please contact Ray Volpatt, Jr. We independent of any particular manufacturer. Working institutional, retail and sustainable construction. PJ Dick Inc. are Building. 225 North Shore Drive with industry leaders from across the spectrum to Pittsburgh PA 15212 deliver the right solutions, every time. We build an T: 412-807-2000 array of services by consistently staying on top—and www.pjdick.com ahead—of the latest technologies and the changing Bernard J. Kobosky Developer needs of the business world. [email protected] LANDAU BUILDING COMPANY PJ Dick – Trumbull – Lindy Paving is a Pittsburgh, PA 9855 Rinaman Road based contracting entity providing building construc- Wexford, Pennsylvania 15090 tion, highway, site, and civil construction and asphalt T: 724-935-8800 paving services. Since 1979, the companies have served www.landau-bldg.com a number of different owner groups including com- Thomas Landau mercial, institutional, government and private equity Horizon Properties Group, Inc. developers. Consistently ranked among the nation’s Tri-State Reprographics, Inc. [email protected] 375 Southpointe Blvd. 2934 Smallman Street Since our inception nearly 120 years ago, Landau Build- top firms, the family owned group of companies is Suite 410 widely considered the region’s largest construction firm Pittsburgh, PA 15201 ing Company has evolved into a premier commercial Canonsburg, PA 15317 T: 412-281-3538 construction firm. For over five generations we have -in offering a variety of delivery systems utilizing superior T: 724-743-7722 ext 2502 expertise, equipment and innovation. F: 412-281-3344 sisted on exceeding our clients’ expectations for quality Michael Swisher www.tsrepro.com and service – and that insistence built the reputation [email protected] DJ McClary, Director of Operations we reinforce every day. Focusing on client satisfaction Horizon Properties Group, Inc. is a full service real [email protected] is our philosophy and our business strategy. Demon- estate development company with extensive experi- For 70 years, Tri-State has provided printing and docu- strating our integrity, value, and quality on every proj- ence in the development of new communities, office ment management to Architects, Engineers and Con- ect is our plan to ensure continued success. Our clients buildings, corporate headquarters facilities, retail, tractors. Today we utilize the latest in Online Planroom know that Landau will represent their best interests Rycon Construction Inc. hospitality and residential projects. The company is Services, Scanning / Printing in both Black &White and and deliver the best product money can buy. 2525 Liberty Avenue headed by Rod L. Piatt and Michael Swisher who were Color. Level 3 Graphics, a division of Tri-State specializ- Pittsburgh PA 15222 the key individuals responsible for the successful devel- ing in large format color, services the Sign, Advertising, T: 412-392-2525 opment of Southpointe including the master planning. and Display Markets. Our unique approach combined F: 412-392-2526 Horizon Properties Group is comprised of an in-house with our product research and years of knowledge www.ryconinc.com staff of architects, planners, engineers, landscape ar- enables us to continually present new possibilities to Todd Dominick chitects, interior designers and financial professionals our clients. [email protected] that enable Horizon to excel in all facets of real estate Rycon Construction, Inc. is a premier preconstruction, development. McKamish, Inc. general contracting and construction management 55th & AVRR firm with expertise in new construction, renovations Pittsburgh PA 15201 and design-build projects for owners of commercial, T: 412-781-6262 industrial, institutional and governmental buildings. F: 412-781-2007 Rycon’s stellar reputation for quality service is built on www.mckamish.com a solid history of successful projects completed on time Dave Casciani and on budget and an unwavering business philosophy [email protected] that puts customer satisfaction first. The results are return customers and impressive company growth. When it comes to specialty mechanical contracting, Rycon has executed more than $1.7 billion of work and McKamish sets the bar. The Commercial Construction currently averages in excess of $140 million annually. Group at McKamish serves customers big and small in virtually all market segments, meeting their Mechani- cal Contracting, Plumbing and HVAC needs. We excel at Pre-Construction and Design Assist/Build services. The McKamish Service Group thrives to optimize customer investment in new and existing building systems. A dedicated team of professional technicians, operating a fleet of vehicles, provide McKamish Service customers with around-the-clock support. Please visit our website – www.mckamish.com – to learn more about us!

www.developingpittsburgh.com 89 Economic Development Fay-Penn Economic KU Resources, Inc. Development Council 22 South Linden Street 1040 Eberly Way Duquesne, PA 15110 Suite 200 Firsching, Marstiller, Rusbarsky T: 412-469-9331 Lemont Furnace, PA 15456 & Wolf Engineering, Inc. F: 412-469-9336 T: 724-437-7913 1500 Ardmore Boulevard, Suite 200 www.kuresources.com www.faypenn.org Ambridge Regional Pittsburgh, PA 15221 Mark Urbassik Dana Kendrick 2301 Duss Avenue Suite 1 T: 412-271-5090 [email protected] [email protected] Ambridge PA 15003 F: 412-271-5193 KU Resources, Inc. provides a full range of environmen- T: 724-266-4661 For 20 years, Fay-Penn has been the lead agency www.fmrwengineering.com tal management and site development engineering www.ambridgeregional.com for economic development in Fayette County. As Joseph Loizzo, P.E. services to industrial, commercial, and community- Gene Pash, President evidenced by its experience and successes, Fay-Penn [email protected] based clients. The firm specializes in brownfield rede- [email protected] has a high quality staff in place with a number of years Firsching, Marstiller, Rusbarsky & Wolf Engineering, velopment, environmental site assessment, economic Value Ambridge Properties at the Ambridge Regional of experience in planning, managing and marketing Inc. provides Mechanical, Electrical, Plumbing and revitalization assistance, regulatory permitting and Distribution & Manufacturing Center is located in buildings; construction, rehabilitation, and mainte- Fire Protection consulting engineering services for compliance, remediation design and implementation, Beaver County and is convenient to all major local nance of buildings; business park development; tenant commercial buildings. We design M.E.P. systems for and environmental risk management strategies. The roadways, and only 11 miles from the proposed ethane lease development and management; state and federal hospitals, surgery centers, office buildings, universities, firm’s engineering and environmental consulting capa- cracker plant. Entirely zoned for industry, its 85 acres grant writing, management, and administration; work- laboratories, churches, theaters, and airports. We also bilities also include the areas of civil and geotechnical house 22 buildings that contain over one million force development; low-interest business financing perform engineering studies and site evaluations for engineering, site development engineering, water square feet of leasable business, warehouse, office, wet solutions; and real estate managing and marketing. existing buildings. We work with building owners for resources engineering, mining and quarry services, lab, distribution, and manufacturing space. Its tenants evaluating and designing equipment replacement water quality monitoring, and air quality compliance also enjoy direct access to Norfolk Southern Rail Co. projects such as water heaters, boilers, air handling and permitting. service as well as on-site maintenance and logistics units, chillers, generators, and electrical service up- services. For more information, call 724-266-4661, or grades. We use both Revit and AutoCAD to develop our visit www.ambridgeregional.com. construction documents. Environmental Washington County Chamber of Commerce 20 East Beau Street Armstrong County Industrial Washington, PA 15301 Development Council T: 724-225-3010 Northpointe Technology Center II F: 724-228-7337 Mary Stollar Fisher Associates 187 Northpointe Boulevard Southpointe GAI Consultants, Inc. Director of Business Investment Freeport, PA 16229 135 Technology Drive, Suite 100 385 E. Waterfront Drive www.WashingtonCountyWorks.com T: 724-548-1500 Canonsburg, PA 15317 Homestead, PA 15120 www.armstrongidc.org The Washington County Chamber of Commerce is the T: 724-916-4250 T: 412-476-2000 T Michael P. Coonley, AICP largest business organization in Washington County Brian L. Fischbach, P.E., LEED www.gaiconsultants.com Executive Director and the second largest chamber of commerce in South- [email protected] Patrick M. Gallagher [email protected] western Pennsylvania. The Chamber focuses on eco- www.fisherassoc.com [email protected] nomic and business development initiatives to expand The Armstrong County Industrial Development Council Providing comprehensive, professional engineering Transforming ideas into reality for over 50 years, the economy of Washington County and was one of the (ACIDC), established in 1968 is a private 501(c)(3) consulting solutions since 1984, Fisher Associates, P.E., GAI’s teams of real estate and economic counselors, first organizations to publically support the economic industrial development corporation. Identified as the L.S., P.C. specializes in Civil Infrastructure & Land Devel- urban planners, engineers, environmental specialists, benefits and job creation potential of the natural gas lead economic development group within the County, opment services. Quality site development demands surveyors, and landscape architects provide innovative, industry. Learn more at www.washcochamber.com. the ACIDC, along with its sister organization the a practiced understanding of design issues inherent practical, and cost-effective solutions for all stages of Armstrong County Industrial Development Authority, with specific land uses, development types, and site land development. Our award-winning land develop- provides single-point-of-contact service for emerg- constraints. In addition, we offer services such as ment portfolio includes large multi-use complexes, ing or expanding business and industry. Owners and Transportation (bridge, highway, traffic, construction retail centers, healthcare and educational campuses, operators of four industrial parks, single use and multi- representation), Environmental, Regulatory Compli- residential communities, urban streetscapes, parks and tenant facilities, the ACIDC works closely with existing Engineer ance, Survey, Landscape Architecture, Geographic trails, marinas, and resorts. Distinguished in our com- or prospective businesses to identify the right location. Information Systems (GIS), Geotechnical Engineering, mitment to urban-infill, Greenfield, and brownfield They also provide financing assistance to companies Construction Scheduling, Non-Destructive Testing, and development, we help clients achieve their project through government loan/grant programs and private 4D Visualization. Contact our office to find more out goals. GAI brings projects from ideas to reality. Learn sector financial institutions. about how we can help you realize your project goals: more at www.gaiconsultants.com.

Civil & Environmental Consultants, Inc. KU Resources, Inc. 333 Baldwin Road 22 South Linden Street Community Development Herbert, Rowland & Grubic, Inc. Corporation of Butler County Pittsburgh, PA 15216 Duquesne, PA 15110 200 West Kensinger Drive, Suite 400 T: 412-469-9331 111 Woody Drive T: 800-365-2324 Cranberry Township, PA 16066 F: 412-469-9336 Butler, PA 16001 www.cecinc.com T: 724-779-4777 www.kuresources.com T: 724-283-1961 Gregory P. Quatchak, P.E. www.hrg-inc.com Mark Urbassik F: 724-283-3599 [email protected] James M. Lopresti, P.E., Vice President [email protected] www.butlercountycdc.com Civil & Environmental Consultants, Inc. (CEC) is a com- [email protected] Ken Raybuck, Executive Director pany of professionals who provide integrated design KU Resources, Inc. provides a full range of environmen- HRG is a full-service consulting engineering firm [email protected] and consulting services at all points in a property’s life tal management and site development engineering celebrating over 50 years of service. Our company has services to industrial, commercial, and community- The Community Development Corporation of Butler cycle. CEC’s industry experts offer a full complement of evaluation, technical and regulatory insight. Our been nationally ranked Top 500 engineering design based clients. The firm specializes in brownfield rede- County (CDC) is the lead economic development firm in the United States by Engineering News-Record velopment, environmental site assessment, economic organization in the County. The CDC is your first contact value lies in the practical knowledge senior leaders contribute along with our broad skill-sets and desire to (ENR) magazine 12 consecutive years. HRG has eight revitalization assistance, regulatory permitting and for economic development in Butler County. The CDC office locations throughout Pennsylvania, West Vir- compliance, remediation design and implementation, works closely with you to identify the right location for advance our clients’ strategic objectives. We’re building trust and our reputation on a local level through ginia, and Ohio, and a staff of 215 engineers, surveyors, and environmental risk management strategies. The your business. Available land includes 40 acres, with a geologists, landscape architects, environmental spe- firm’s engineering and environmental consulting capa- KOZ designation, at Victory Road Business Park and 30 personal business relationships while continually as- sessing our environmental and economic sustainability cialists and related personnel to deliver a full-service bilities also include the areas of civil and geotechnical acres at the Pullman Center Business Park Expansion; engineering, site development engineering, water in the communities where we practice. approach to every project. Our accomplished team all utilities are available at both sites. Office space is provides services related to land development, water resources engineering, mining and quarry services, also available for sale/lease at Pullman Commerce resources, water/wastewater & energy, transportation, water quality monitoring, and air quality compliance Center and Bantam Commons. survey, GIS, environmental, mechanical/electrical/ and permitting. 90 DEVELOPINGPITTSBURGH | Fall 2013 plumbing, and financial consulting. Green Building/ Northwest Savings Bank Southwest Region Headquarters Energy Consultant Master Builders’ Association of 125 Emeryville Drive, Suite 100 Western Pennsylvania, Inc. Cranberry Township, PA 16066 631 Iron City Drive Pennoni Associates Inc. T: (724) 778-0200 Pittsburgh PA 15205 700 Seco Road www.northwestsavingsbank.com T: 412-922-3912 Monroeville PA 15146 Northwest Direct: 1-877-672-5678 www.mbawpa.org T: (412) 229-2778 Christopher Martin, Regional President Jon O’Brien www.pennoni.com [email protected] [email protected] John Skorupan Founded in 1896, Northwest Savings Bank is a full- Trane Leading the Industry, Building the Region! [email protected] service financial institution offering a complete line Pennoni Associates is a multi-disciplined consulting 400 Business Center Drive The Master Builders’ Association represents the of business and personal banking products, employee engineering and design firm employing 900 profes- Pittsburgh, PA 15205 preferred commercial contractor in our region. Col- sional, technical, and administrative personnel with benefits and wealth management services, as well T: 412-747-3000 lectively, the membership accounts for over 80% of 28 offices throughout the eastern United States. Pen- as the fulfillment of business and personal insurance www.Trane.com the commercial construction in our area and the MBA noni, an ESOP company, offers services in Site Design, needs. Northwest operates 166 community banking Tim White, Sales Manager Complex Solutions contractors have built over 90% of the square-footage Landscape Architecture, Environmental, Health and offices in Pennsylvania, New York, Ohio and Maryland [email protected] of LEED certified buildings in the Pittsburgh region. Safety, Indoor Air Quality, Surveying, Transportation, – including 28 offices in the Greater Pittsburgh area. Trane, a wholly owned subsidiary of Ingersoll Rand With skilled labor, superior safety services and the Land Development, Construction Inspection and Test- For 117 years, we have served our communities with an (NYSE: IR), is a world leader in creating and sustaining latest technology, the MBA contractor is the best value ing, MEP, Geotechnical, Underwater Inspection, and ever-expanding array of banking and investment prod- safe, comfortable and efficient environments in com- for construction. Structural Engineering. Locally, Pennoni has offices ucts that meet the needs of both business and personal mercial, residential and industrial markets. Trane offers located in State College, Monroeville and Uniontown customers. Member FDIC, Equal Housing Lender. a broad range of energy-efficient heating, ventilation that service the developer, building owner, industrial, and air conditioning solutions services, systems and transportation, education, government, and Marcellus solutions, including aftermarket service and parts; Interior Designer Shale industries in western Pennsylvania, West Virginia, advanced building controls; and building solutions that and Ohio. allow energy-efficient systems to pay for themselves through energy savings. Over nearly 100 years, Trane’s built their reputation for reliability, high quality, prod- PNC Real Estate uct innovation, and a powerful distribution network. Visit www.trane.com. Finance 249 Fifth Avenue Pittsburgh PA 15222 www.pnc.com/realestate Joe Pascarella, VP Industry/Trade Association T: 412-762-2672 Design 3 Architecture PC [email protected] 300 Oxford Dr. Ste. 120 Autumn Harris, AVP Monroeville, PA 15146 Dollar Bank T: 412-762-4702 T: 412-373-2220 Three Gateway Center [email protected] www.d3a.com 401 Liberty Avenue PNC Real Estate is a leading provider of banking, William Snyder Pittsburgh PA 15222 financing and servicing solutions for commercial real [email protected] T: 412-261-7515 estate clients. Our capabilities include acquisition, con- Design 3 Architecture has been offeringarchitecture, www.dollarbank.com struction and permanent financing for developers and planning, and interior design services to the Pittsburgh David Weber investors; agency financing for multifamily properties; region since 1982. We view inherent project constraints [email protected] and debt and equity capital for the affordable housing as potential opportunities for innovative design solu- As your business changes, you'll need the flexibility to industry. And, through Midland Loan Services, we Builders Guild of Western PA, Inc. tions. With a philosophy grounded in team collabora- respond to market opportunities by purchasing equip- provide third-party loan servicing, asset management 650 Ridge Road, Suite 301 tion, providing both personal attention and project ment, expanding your facilities or increasing working and technology solutions. Pittsburgh, PA, 15205 leadership, Design 3 Architecture does more than solve capital. Your credit needs will change as your business T: 412-921-9000 problems. We provide solutions that are unique, excit- grows, so your overall credit plan should address www.buildersguild.org ing and affordable. short-term demands as well as long-term growth. Building trade unions and contractors working to- Dollar Bank’s Business Banking Experts will work to gether to provide the best value in construction. Our understand your business and assist you in achieving Geotechnical Engineer 40,000 member workforce is professionally trained in your goals with the right financing for your needs. For the finest apprenticeship centers in the country. We Land Surveyor more information, contact David Weber, Vice President understand the demands of the industry, are commit- Business Lending. ted to customer satisfaction and are drug free. Today’s building trade unions are setting a new standard of ACA Engineering, Inc. excellence. Get to know us. 410 North Balph Avenue Pittsburgh, PA 15202 T: 412-761-1990 First National Bank www.acaengineering.com Pennoni Associates Inc. Thomas R. Beatty, P.G. 12 Federal Street 700 Seco Road [email protected] Pittsburgh, PA 15212 Monroeville PA 15146 Robert B. Powderly, SVP, Managing Director ACA Engineering, Inc. is an independently owned T: (412) 229-2778 Investment Real Estate Group and operated geotechnical and environmental engi- www.pennoni.com T: 412-359-2663 neering, materials testing and inspection firm with IRONWORKER EMPLOYERS John Skorupan [email protected] offices in Pittsburgh, Mechanicsburg, and Laporte ASSOCIATION [email protected] www.fnb-corp.com PA, and Youngstown, OH. Our engineers, geologist, Of Western Pennsylvania Pennoni Associates is a multi-disciplined consulting en- First National Bank offers diversified financial solutions draftspersons, inspectors, and technicians provide Foster Plaza 9 gineering and design firm employing 900 professional, quality designs, engineering studies, surveys, and to our commercial clients, including corporate banking, 750 Holiday Drive, Suite 615 technical, and administrative personnel with 28 offices project management. Our senior staff has a combined small business banking, investment real estate financ- Pittsburgh, PA 15220 throughout the eastern United States. Pennoni, an ESOP experience of over 100 years in engineering, construc- T: 412-922-6855 company, offers services in Site Design, Landscape Ar- ing, asset based lending, capital markets and lease tion inspection, and laboratory testing. ACA maintains financing. You can rely on the experience and expertise www.iwea.org chitecture, Environmental, Health and Safety, Indoor Air an in-house laboratory that has been inspected and Quality, Surveying, Transportation, Land Development, of local professionals who understand the industries, William C. Ligetti, Jr. accredited by AASHTO Materials Reference Laboratory, [email protected] Construction Inspection and Testing, MEP, Geotechnical, economy and business climate of this region. Whether Cement and Concrete Reference Laboratory, and the Underwater Inspection, and Structural Engineering. you need capital for facility expansion, an acquisition, U.S. Corps of Engineers. The IWEA is a Trade Association of Union Contractors who work in all aspects of the Ironworking Trade within Locally, Pennoni has offices located in State College, construction or other long-term financing plans, we the Construction Industry. We are a resource for all Monroeville and Uniontown that service the developer, have the solutions to help you achieve your business owners, developers and contractors who are looking building owner, industrial, transportation, education, goals. Call us today to learn more. First National Bank, for a qualified contractor with a well-trained work- government, and Marcellus Shale industries in western Member FDIC, Equal Housing Lender. force. Visit our website or call our office for additional Pennsylvania, West Virginia, and Ohio. information. www.developingpittsburgh.com 91 services and market intelligence that encompass ac- Maintenance/ counting, research, marketing and administration, as Landscape Architect Professional Services well as access to cutting-edge technology. Service Contractor

Grant Street Associates, Inc. The Grant Building Babst Calland 310 Grant Street GAI Consultants, Inc. Two Gateway Center Suite 1550 385 E. Waterfront Drive Multiscope Document Solutions 603 Stanwix Street Pittsburgh, PA 15219 Homestead, PA 15120 135 Technology Drive 6th Floor T: 412-391-2600 T: 412-476-2000 Canonsburg, PA 15317 Pittsburgh, PA 15222 www.gsa-cw.com www.gaiconsultants.com T: 724-743-1083 T: (412) 394-5400 At Grant Street Associates, Inc., we aim to be your com- Patrick M. Gallagher F: 888-515-7120 www.babstcalland.com [email protected] www.multiscope1.com mercial real estate provider of choice - the standard for Marcia L. Grimes, Esquire industry knowledge, service and execution in the Pitts- Transforming ideas into reality for over 50 years, Douglas Beck, Managing Partner [email protected] [email protected] burgh region. As a full-service commercial real estate GAI’s teams of real estate and economic counselors, Justin D. Ackerman, Esquire firm and member of the Cushman & Wakefield Alliance, urban planners, engineers, environmental specialists, At Multiscope Document Solutions, we deliver [email protected] Grant Street Associates has been providing unsurpassed surveyors, and landscape architects provide innovative, state-of-the-art document, paperless and hardware Babst Calland’s lawyers have well-rounded skills in real client-oriented tenant, landlord, buyer and seller repre- practical, and cost-effective solutions for all stages of technology solutions to organizations nationwide. estate, corporate, finance, energy, environmental, and sentation services since 1993. We have built one of the land development. Our award-winning land develop- We are dedicated to helping our customers create ef- zoning and� land use law, as well as diverse, practical most dedicated, recognized and respected commercial ment portfolio includes large multi-use complexes, ficiency, improve productivity and add to their bottom experience. We provide pragmatic and creative advice real estate firms in the Greater Pittsburgh region. retail centers, healthcare and educational campuses, lines with document solutions tailored to their needs. to developers, landlords, tenants, buyers, brokers and residential communities, urban streetscapes, parks Our award-winning services are custom-designed inde- managers of commercial real estate in all aspects of and trails, marinas, and resorts. Distinguished in our pendent of any particular manufacturer. Working with their business. 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Six PPG place, Suite 600 Pittsburgh PA 15222 T: 412-281-0100 Schneider Downs www.ngkf.com Gerard McLaughlin 1133 Penn Avenue [email protected] Pittsburgh, PA 15222 Louis Oliva T: 412-261-3644 [email protected] Trane www.schneiderdowns.com Pennoni Associates Inc. 400 Business Center Drive Gennaro DiBello With roots dating back to 1929, Newmark Grubb Knight Pittsburgh, PA 15205 Frank’s strong foundation and broad experience make 700 Seco Road [email protected] T: 412-747-3000 it one of the most trusted names in commercial real Monroeville PA 15146 Since 1956, Schneider Downs has provided an array of www.Trane.com estate worldwide. 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We offer extensive corporate real estate solutions, range of commercial real estate services. From landlord knowledge and experience in Asset Services, Brokerage representation to property management to tenant Services, Corporate Services Investment Sales, Facilities representation to brokerage services – whatever your real Management, Management Services and Retail Ser- estate needs might be – TARQUINCoRE can help you maxi- vices. The CBRE Pittsburgh, Erie and State College offices mize options, seize opportunities, avoid potential pitfalls are committed to providing clients with quality support and expedite transaction times.

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