1100 Chartiers Avenue Mckees Rocks, PA 15136

OFFERING MEMORANDUM 1100 Chartiers Avenue McKees Rocks, PA 15136

SALE / LEASEBACK OPPORTUNITY Located in a Qualified Opportunity Zone

Exclusively Represented By:

GREGG BROUJOS MICHELLE DOMEISEN SIOR, CCIM Regional Principal | Pittsburgh Senior Vice President | Pittsburgh COLLIERS INTERNATIONAL Investment Services Investment Services 525 William Penn Place +1 412 515 8523 +1 412 515 8544 Suite 3510 [email protected] [email protected] Pittsburgh, PA 15219 P: +1 412 321 4200 www.colliers.com/pittsburgh BROCHURE

For Sale

Pittsburgh International Airport

SITE Sale/Leaseback Opportunity

Pittsburgh Gregg Broujos Principal | Pittsburgh Jenny Lee Bakery Facility Investment Services +1 412 515 8523 [email protected] 1100 Chartiers Avenue Ovens Michelle Domeisen, SIOR, CCIM McKees Rocks, PA 15136 Senior Vice President | Pittsburgh Investment Services +1 412 515 8544 Located in a Qualified Opportunity Zone [email protected] • Jenny Lee | 5 Generation Bakers will sign an eight year Population Average Number of Household Households triple net lease at closing Income 525 William Penn Place, Suite 3510 Pittsburgh, PA 15219 • 18,279 SF building on 1.43 acres 1 Mile 15,451 $39,046 6,805 P: +1412 321 4200 Freezer • Fully sprinklered / masonry construction F: +1 412 321 4400 3 Miles 88,916 $50,609 39,820 colliers.com/pittsburgh • One (1) rear loading dock for tractor trailer access 5 Miles 215,614 $56,080 95,966 Assembly Line • Zoning - B-2 Commercial District 10 Miles 763,489 $66,323 336,481 • The bakery has been in business for over 135 years Copyright © 2021 Colliers International. Information herein has been obtained from sources • McKees Rocks has experienced a resurgence in the deemed reliable, however its accuracy cannot be guaranteed. The user is required to conduct past few years with projects like the $4.2 million state- their own due diligence and verification. of-the-art Father Ryan Arts Center and the $9.0 million renovation of the Roxian Theatre

Accelerating success. 2 TABLE OF CONTENTS Executive Summary ...... 5 • Offering Summary...... 9 Property Overview ...... 10 • Property Description ...... 11 • Site Plan ...... 13 • Aerial Maps ...... 14 • Regional Map ...... 15 Area Overview...... 16 • Demographic Survey ...... 23 • Sales Comps ...... 24

3 EXECUTIVE SUMMARY

4 EXECUTIVE SUMMARY

The ownership group of Jenny Lee Swirl Bread/5 Generation Bakers, through their exclusive brokerage firm, Colliers International, is offering their headquarters and production facility for sale through a sale/leaseback transaction. Jenny Lee has strategically decided to unlock the equity in their commercial real estate asset at 1100 Chartiers Avenue in McKees Rocks in order to free up funds to grow their bakery business through diversification of product lines.

Jenny Lee will enter into an eight (8) year lease at closing with a projected yearly lease rate of $160,200 under a triple net lease structure. The lease will also include two percent (2%) annual rental rate increases. The sale of the property will be subject to finalizing a mutually acceptable lease between Jenny Lee and the buyer. The contemplated lease calls for Jenny Lee to be responsible for base rent, property taxes, utilities, insurance, and CAM. The new landlord would be responsible for roof, structure, and parking lot. However, all terms and conditions of the leaseback arrangement, including base rent, are negotiable based on a number of factors and upon mutual agreement between the parties.

1100 Chartiers Avenue is located in a Qualified Opportunity Zone. More information can be found on the Pennsylvania Department of Community and Economic Development at: https://dced.pa.gov/programs-funding/federal- funding-opportunities/qualified-opportunity-zones.

The federal tax bill passed at the end of December 2017 enables the governor to designate certain census tracts as Opportunity Zones. Investments made by individuals through special funds in these zones would be allowed to defer or eliminate federal taxes on capital gains. The governor was given the opportunity to designate up to 25 percent of census tracts that either have poverty rates of at least 20 percent or median family incomes of no more than 80 percent of statewide or metropolitan area family income. There are nearly 1,200 eligible census tracts and the governor designated 300 tracts based on economic data, recommendations from local partners, and the likelihood of private-sector investment in those tracts.

Upon the signing of a Non-Disclosure Agreement, potential investors can access the relevant financial and background information on Jenny Lee. Please contact our office for more details.

5 EXECUTIVE SUMMARY

The property is an 18,279 square foot former Bottom Dollar grocery store just off of the central business district of McKees Rocks. The 1.43 acre site is comprised of four parcels. There is one loading dock and the ceiling height ranges from 15’4” in the finished ceiling area to 20’ in some areas. The building was constructed in 2012 and features masonry construction with exterior block and dryvit. Property taxes are approximately $42,000 per year. Phase I and Phase II reports are available by request. The building is fully sprinklered and is located in the B-2 Commercial District in the borough. McKees Rocks has experienced a resurgence in the past few years with projects like the $4,200,000 state-of-the-art Father Ryan Arts Center and the $9,000,000 renovation of the Roxian Theatre. McKees Rocks has a strong community development corporation, and more information can be found at: www.mckeesrocks.com.

Jenny Lee has been in business for over 135 years, with five generations of family members guiding the company. More information can be found on the following pages and on their website at: https://jennyleeswirlbread.com/about.

The baking traditions of the Baker family began in the mid 1800’s when Michael A. Baker immigrated to the United States from Germany as a young teen. Originally named “Becker”, Michael changed his name to “Baker” to be more American. It wasn’t too long after this that his lifelong trade would also become “baker.”

Michael founded the first bakery, the Michael A. Baker Bakery, in 1875 at 25 Steuben Street in the West End of Pittsburgh. Initially a retail bakery, Michael expanded his services to “door-to-door” delivery. Eventually Michael’s sons joined the business and the name soon evolved to Michael Baker & Sons.

Michael’s seven sons had big aspirations. They continued to grow the business throughout the Western Pennsylvania region and soon became the largest bakery wholesaler in the state. Upon their father’s retirement, the bakery name changed again, this time to “The Seven Baker Brothers Bakery.” Their success could be measured by their unique marketing skills establishing the “Wonder Baked” product line (eventually “borrowed” by the baker’s of Wonder Bread), creating Felix the Wonder Cat and Sic’em the Wonder Dog, and flying the maiden voyage of “The Spirit of Pittsburgh” – a great publicity stunt featuring the nation’s only flying bakery vehicle.

At the height of their success, the Baker Brothers grew their bakery to 125 delivery vehicles – trucks and horse-drawn carriages – and over 400 employees. A state of the art baking facility was built on Saw Mill Run Boulevard in the West End to house this grand enterprise. They delivered their quality baked products as far away as Youngstown to Erie to Weirton and to the edges of Philadelphia County.

During this time, the Seven Brother’s were also busy growing their families. Their great-grandfather, Nick Baker was a twin and the third born son of Michael Baker. Nick had a large family of his own, fathering 9 children with his wife, Theresa May Baker. Nick’s children were a very ambitious lot. The oldest, Paul, founder of Jenny Lee Bakery; Amelia, proprietor of Hartner’s Restaurant for over 50 years; Catherine, two time serving Treasurer of Pennsylvania and our state’s first female Lieutenant Governor; John, a world renowned artist to name just a few.

Nick’s children were the third generation of the Baker family in the baking industry and many of their cousins, like them, continued in the family heritage: Karn’s Bakery and McKees Rocks Bread Company and others. This precedent was set by Paul in 1938, when despite the continued success of The Seven Baker Brother Bakery, he and cousin Bernard McDonald founded Jenny Lee Bakery in the heart of Pittsburgh Diamond Market, now known as Market Square. Initially, Paul sold Seven Baker Brother’s products out of his retail store. Within four months of his new business, Paul began baking his own line of quality products 6 EXECUTIVE SUMMARY that eventually required the acquisition of his second store – and main baking location – in McKees Rocks. This expansion took place in 1941.

Now operating two successful locations, Paul continued to expand Jenny Lee Bakery. In the 1940’s and 50’s, Jenny Lee added two additional locations in McKees Rocks as well as several stores in neighboring communities. Paul’s success in the 40’s was matched with the demise of The Seven Baker Brother’s Bakery which ceased operations in the mid-1940’s. An operator of tradition, Paul continued to produce and sell many popular Seven Baker Brother’s products, such as Seven Baker Brother’s Raisin-Filled Cookies, Devil Dogs and crimped cinnamon raisin bread. These products remained popular throughout the decades and maintained sales for Jenny Lee as recently as 2008.

Jenny Lee maintained successful growth in the ‘60’s and ‘70’s as Paul’s three sons joined him in the business and eventually grew to 14 retail locations throughout the Pittsburgh Region. By early 1974, Jenny Lee had grown to 14 retail locations. Paul would retire in 1978 and hand the business over to his three sons: Jim, Rich and Bernie.

As the decades passed by, so did Jenny Lee’s success. The 1980’s presented many challenges for the retail baking industry as the marketplace changed and people changed their shopping behaviors. In response to this decline in business, Jenny Lee responded by closing several retail stores. Also at this time, the fifth generation of the Baker family was discovering their own ambitions with several choosing careers in baking. John Pockl with Karn’s and eventually Bethel Bakery, Nick Hartner with Mancini’s Bakery, Reed Baker helping to develop the McKees Rocks Bread Company and Scott Baker joining the family traditions at Jenny Lee Bakery.

The challenges that Jenny Lee faced soon caused tension in the business. In 1992, upon his son Scott’s graduation from the American Institute of Baking, Bernie set out to find his own baking fortunes. Bernie and Scott explored many vacant bakeries and thriving businesses which to invest in and create their own identity. When Bernie’s brothers chose not to buy out his share of Jenny Lee, he instead decided to buy out their shares. In 1994, this transaction commenced and Jenny Lee was now solely owned by Bernie Baker. His son Scott, upon his graduation from the University of Pittsburgh in December of 1994 soon joined the business managing retail sales.

On Thanksgiving Day 2006, the bakery experienced a devastating fire that nearly wiped out the second floor offices and candy production area. This fire forced the bakery to close for more than 4 months and miss two major holidays. After major renovation, Jenny Lee Bakery was able to reopen in April of 2007. But as a result of this fire and downtime, Jenny Lee lost more than half of its wholesale business as well as many retail shoppers who were forced to go elsewhere. Sadly, due to these challenges and a dismal economy, Jenny Lee Bakery closed its doors forever on August 16, 2008.

Out of a desire to continue in the Baker Family baking traditions, 5 Generation Bakers was founded in June of 2009. 5 GB is a commercial manufacturer of frozen wholesale products. The line will initially consist of simply two products: gourmet cinnamon swirl and cinnamon raisin breads. The only similarity to Jenny Lee Bakery will be a commitment to producing only the finest baked products and THIS is a Baker Family tradition.

7 EXECUTIVE SUMMARY

UPDATE AS OF 0CTOBER 2020 5 Generation Bakers (“5GB”) is seeking continued expansion of its high-quality product offerings via strategic co-manufacturing partnerships and product-line expansion. 5GB has recently signed with Daymon Worldwide, a national broker imbedded with dozens of leading retail chains. This partnership will expand their product portfolio, add new distribution channels, and leverage their available manufacturing capacity. They would like to offer any combination of their physical assets located in the McKees Rocks Opportunity Zone, convertible note and equity in the business to select investors. The funds will be used to execute on their strategic growth plans.

2019 revenue was $2.1 million and 2020 projected EOY is $2.6 million with 4% profit. In 2021, 5 Generation Bakers is forecasting $3.6 million. However, with several new contracts in place, that will likely increase to $4 million in revenue with a 10% operating profit. This eight-year sale/leaseback is being offered as an investment vehicle to secure working capital and to restructure the balance sheet. During the current pandemic, 5GB has diversified its business with co-baking relationships outside of its normal offerings.

During the peak of the 2020 COVID crisis, 5GB worked a one-week-on, one-week-off structure to preserve cash and maintain customer relations. They also pivoted their business to diversify their offerings to come out of the crisis stronger. 5GB launched the Jenny Lee Sticky Bun, which has been recognized as one of the 2020 most innovative items by Progressive Grocer Magazine. Further, because of the pandemic and the need for bakeries to keep product on the shelf, 5GB began seeking contracts in co-packing, securing business with Super Bakery, Michael Foods, XLNT Bakeries, Bill Knapp’s, and Hemp Synergistics. Other co-pack agreements with Vlore Bakery, Tomanetti’s, Sarris Candies and Dierberg’s are exciting partnerships. The new co-pack partnerships, along with continuing the Jenny Lee Swirl Breads brands, will secure profitable years ahead.

With a robust strategic retail bakery goods partnership, 5GB will further capitalize on expected market growth in the retail bakery goods markets through product diversification, innovation in product development, entry into emerging markets and both wholesale and retail distribution.

8 OFFERING SUMMARY

List Price ……..…………….…………………………………...... ….....……...... $2,250,000 Offered exclusively by the Capital Markets and Investment CAP Rate ……………..…...... ……..…………………...... …...... 7.12% Services Division of Colliers International | Pittsburgh, this Year Built ...... 2012 sale / leaseback opportunity is offered through 5 Generation Gross Leasable Area ………..………...... …………………….…………...... 18,279 SF Bakers, a one hundred and thirty-five (135) year old Pittsburgh Lot Size ……...... …………..…………...... ………….……………..………...... 1.43 Acre business enterprise which markets Jenny Lee Bakery products. Parking Spaces ……..…………...... …..……………….....…………...... 60 with 4 handicapped spaces The offering of eight (8) years is proffered as the term which Tenant ..………….…………...... …..………...... ……………...... 5 Generation Bakers is the minimum acceptable to the tenant. An extension of this Lease Commencement ……...... …..……...... ……………...... Upon Closing primary term could be within the negotiation parameters of the Primary Lease Term …………...... ……...... ……...... Eight (8) Years transaction. Monthly Rent ...... $13,350 Annual Rent ...... $160,200 Annual Rent Escalation ...... 2%

Opportunity Zone: The property sits within a jurisdictionally provided opportunity zone with specific investment advantages available.

Right of First Refusal: 5GB will have the Right of First Refusal if the property is placed on the market by the new owner.

Buy-Back Option: 5GB will also entertain a Buy-Back option with a purchase price for- mula to be determined.

9 PROPERTY OVERVIEW

10 PROPERTY DESCRIPTION

PROPERTY NAME: 1100 Chartier Avenue ZONING: B-2 Commercial District McKees Rocks, PA 15136

TAX ID: 72-M-160 PERMITTED USES: Operation is within the current permitted uses

TAXES: $42,278 per year NUMBER OF BUILDINGS: One (1)

LAND AREA: 1.43 Acres STORIES: One (1)

GROSS BUILDING AREA: 18,279 SF DESCRIPTION: Food preparation and assembly facility

YEAR BUILT: 2012 Construction FOUNDATION: Concrete slab & footer

YEAR RENOVATED: 2016 PARKING: Sixty (60) spaces (4 handicapped); 3.29 ratio

WATER: West View Water STRUCTURAL FRAME: Structural steel and poured reinforced concrete

SEWER: Allegheny County Sanitary Authority EXTERIOR WALLS: Concrete block & Dryvit with insulated metal wall panels

ELECTRICITY: Duquesne Light Company ROOF: Single ply TPO roof over galvanized deck with vapor barrier & insulation

NATURAL GAS: Columbia Gas CLEARANCES: 15’ 4” - 20’ under roof

11 PROPERTY DESCRIPTION

HVAC: 15 Ton refrigeration system FLOOR COVERING: A mix of resinous flooring, tile & carpet tiles

ELEVATORS: None WALLS: Gypsum board walls covered with paint

FIRE PREVENTION: Located in mechanical/electrical room DOORS: Steel doors and frames with a communicator panel

FLOOR COVER: Poured concrete throughout CEILINGS: Acoustical panels & metal suspension system

WINDOWS: New interior standard steel windows

ELECTRICAL SYSTEM: 800 Amp; 3 phase. A transformer and switch gear are located at the west side of the building and feed main distribution panels in the northwest corner

LOADING DOCK One (1) rear loading dock

PLUMBING: Copper distribution. Hot water system compressed air and sanitary

SPRINKLERS: Sprinklered throughout the building

12 SITE PLAN

Schedule "B" Section 2

Exhibit A First American Title Insurance Company First American Title Insurance Company Commitment No. NCS-695229-60-PHIL Commitment No. NCS-695229-60-PHIL Effective Date: September 18, 2014 Effective Date: September 18, 2014 As to Parcel I: 10 Right of Way as contained in Deed Book Volume 14969, Page 306 AS SHOWN, WIDTH NOT IDENTIFIED IN DOCUMENT. All that certain lot or piece of ground situate in the Borough of McKees Rocks, County of Allegheny and Commonwealth of Pennsylvania being a part of the Unnumbered Southerly Lot in the First Addition to Parkway Plan of Lots as recorded in the Recorder's Office of Right of way for 48 inch storm sewer granted by Colonial Trust Co. to Borough of McKees Allegheny County, Pennsylvania in Plan Book Volume 31, Page 160, bounded and described as follows: Rocks by agreement dated December 2, 1912, not recorded but recited in deed from Colonial Beginning at the southerly corner of Lots 28 and 29 in the Plan noted above and thence along this line as extended, South 01°30' West a 11 Trust Co. to Pittsburgh Railways Company, dated February 16, 1925 and recorded in Deed distance of 52.33 feet, more or less, to a point on the northerly line of 40 foot Lake Street; thence along Lake Street South 79°35' West a distance of 62.86 feet, more or less, to a point; thence North 01°30' East a distance of 65.31 feet, more or less, to a point, said point being Book Volume 2208, Page 625. the southwesterly corner of Lot 30 of Plan noted above; thence along the southerly line of Lots 30 and 29 in said Plan South 88°30' East a AS-SHOWN ON SURVEY distance of 61.50 feet, more or less, to the place of beginning.

Being designated as tax parcel Block 72-M, Lot 148. As to Parcel II: 12 Subject to all matters shown on the Plan as recorded in the Recorder's Office of Allegheny County, Pennsylvania in Plan Book Volume 17, Page 109. All that certain lot or piece of ground situate in the Borough of McKees Rocks, County of Allegheny and Commonwealth of Pennsylvania being all of Lot 14 in Otto A. Buettner Plan of record in the Recorder's Office of Allegheny County in Plan Book Volume 17, Page 109. THIS ITEM IS BLANKET IN NATURE, THEREFORE UNPLOTABLE Being designated as Block 72-M, Lot 150 in the Deed Registry Office of Allegheny County. 13 Agreement for right of way for a forty-eight inch storm sewer from The Colonial Trust As to Parcel III: First Described: Company to the Borough of McKees Rocks, dated December 2, 1912 and unrecorded, but referred to in Deed Book Volume 3163, Page 553. All that certain lot or piece of ground situate in the Borough of McKees Rocks, County of Allegheny and Commonwealth of Pennsylvania, AS-SHOWN ON SURVEY which lot is bounded and described as follows: 11 13 11 13 Beginning at a point at the northeast corner of Chartiers Avenue and Amelia Street; thence along the easterly side of Amelia Street North 01° 30' East 326.62 feet to a point; thence South 88° 30' East 161.50 feet to a point; thence South 01° 30' West 292.68 feet to a point on the northerly side of Chartiers Avenue; thence along said northerly side of Chartiers Avenue South 79° 40' West 165.01 feet to the place of beginning. Being designated as Block 72-M, Lot No. 160 in the Deed Registry Records of Allegheny County, Pennsylvania. Second Described: All that certain lot or piece of ground situate in the Borough of McKees Rocks, County of Allegheny and Commonwealth of Pennsylvania, To: Aldi Inc. (Pennsylvania) and Aldi Inc., First America Title Insurance Company, being Lots Nos. 6 and 7 in Otto A. Buettner's Plan of Lots in said Borough, which Plan is recorded in the Recorder's Office of Allegheny County, Pennsylvania, in Plan Book Volume 17, Page 109. and Delhaize America Shared Services Group LLC: Being designated as Tax Map Parcel Block 72-M, Lot 167. This is to certify that this map or plat and the survey on which it is based were made BEING Tax Parcel 0072-M-00148-0000-00, 0072-M-00150-0000-00, 0072-M-00167-0000-00, 0072-M- in accordance with 2011 Minimum Standard Detail Requirements for ALTA/ACSM BEING, AS TO PART OF PARCEL I the same premises which Robert V. Rees, Sr., a married man, by Warranty Deed dated 07/11/2011 and Land Title Surveys, jointly established and adopted by ALTA and NSPS, and recorded 07/12/2011 in Allegheny County at Document No. 2011-16886, granted and conveyed unto Bottom Dollar Food Northeast, LLC, a includes Items 2, 3, 4, 6(b), 7(a), 7(b)(1), 8, 9, 11(a), and 13 of Table A thereof. Delaware limited liability company, in fee. The field work was completed on November 12, 2014. BEING, AS TO PART OF PARCEL II the same premises which Brad Sidles, an unmarried man, by Special Warranty Deed dated 05/26/2011 and recorded 05/31/2011 in Allegheny County at Document No. 2011-12750, granted and conveyed unto Bottom Dollar Food Northeast, LLC, a Delaware limited liability company, in fee.

BEING, AS TO PART OF PARCEL III the same premises which McKees Rocks Foodmarket, Inc., also known as McKees Rocks Food Market, Inc., a Pennsylvania corporation, by Warranty Deed dated 01/20/2012 and recorded 01/23/2012 in Allegheny County at Document No. Dated: David W. LaPearle 2012-1637, granted and conveyed unto Bottom Dollar Food Northeast, LLC, a Delaware limited liability company, in fee. Registration No. SU-034201-E

THE SUBJECT PREMISIS LIES WITHIN THE C-2 ZONING DISTRICT

ZONING DISTRICT: (C-2)

MIN. LOT AREA: 75%

MIN. LOT WIDTH: FORTY FT. (40) FEET

MIN. FRONT YARD: ZERO FT. (0) FEET

MIN. SIDE YARD: FIFTEEN FT. (15) FEET (ABUTTING "R" DISTRICT)

MIN. REAR YARD: THIRTY FT. (30) FEET (ABUTTING "R" DISTRICT)

THE SUBJECT PREMISIS LIES WITHIN THE R-1 ZONING DISTRICT

ZONING DISTRICT: (R-1)

MIN. LOT WIDTH: FIFIY FT. (50) FEET

MIN. LOT DEPTH: ONE HUNDERED FT. (100) FEET

MIN. FRONT YARD: TWENTY FIVE FT. (25) FEET

MIN. SIDE YARD: SIX FT. (6) FEET

MIN. REAR YARD: TWENTY FIVE FT. (25) FEET

ZONING INFORMATION WAS OBTAINED FROM:

http://elibrary.pacounties.org/Documents/ Allegheny_County/102;%20McKees%20Rocks%20Borough/4200346264mzo.pdf NORTH

GW GW GW GW

XXXXXX

E-UG

COM-UG

OH OH

G G

SAN SAN

STM STM

W W DATE DESCRIPTION E E 1 ------2 3 4 5 6 7 8 9 10 

161107 S-100  13 AERIAL MAP

1100 Chartiers Ave.

14 REGIONAL MAP

15 AREA OVERVIEW

16 PITTSBURGH Pittsburgh, an historically stable market, rebounded vigorously from the VENTURE CAPITAL economic downturn of 2008. Pittsburgh’s economy has consistently outperformed the national economy. The Downtown office market has seen INVESTMENTS IN PITTSBURGH similar success. Greater Downtown, including the CBD, is the leading submarket accounting for nearly 36% of Pittsburgh’s total office inventory and is known for START-UPS DOUBLED IN 2019 achieving some of the highest rental rates. Pittsburgh is headquarters for six Fortune 500 companies. FROM 2018 TOTAL

ECONOMIC DRIVERS The company chose the site because of its proximity to liquids-rich natural gas, which will create shorter and more reliable supply chains than comparable Five key industry sectors form a balanced, diverse, and dynamic economic base facilities on the U.S. Gulf Coast. Construction of this facility will create an estimated 6,000 that showcases southwestern Pennsylvania’s past, present, and future-focused construction jobs and be the equivalent to the construction of 25 major sports stadiums. strengths. These fundamentals are energy, finance and business services, Commercial operation, due to begin early in the next decade, is slated to make 1.6 million healthcare and life sciences, information technology, and advanced tons a year of ethylene which is used in products ranging from food packaging to manufacturing. In addition to the five key sectors Pittsburgh has some of the automotive. best tourist attractions, and top education universities.

ENERGY FINANCE & BUSINESS SERVICES The Pittsburgh region has been a major U.S. energy hub for more than a There are several significant financial, banking, and corporate headquarters in decade, and the energy, oil and gas industry has continued to be one of the Pittsburgh, which was rated by Forbes as the #2 City Taking Financial Jobs from area’s most prominent job growth sectors. The Marcellus Shale formation’s Wall Street. Most notably in the banking sectors are PNC Bank, First National ample supply of natural gas has been an enormous factor in the region’s Bank, and the Bank of New York Mellon. Five Pittsburgh-based banks made the impact on the energy industry. In 2007, the Marcellus Shale sector accounted list of Bank Director’s top U.S. Banks, including PNC Bank, First National Bank, for 2% of domestic gas supply, but this figure jumped to nearly 18% at the end and First Commonwealth Financial. Financial services is the largest contributor of 2015. Marcellus Shale is now thought to contain 500 trillion cubic feet of to the regional GDP, according to the Allegheny Conference. The area has begun natural gas. Due in part to this resource, the oil giant Shell announced in 2016 to lure the types of highly trained workers used by financial firms, with financial that it will build a $6 billion “ethane cracker” plant along the Ohio River near employment growing over 7% since 2009. Pittsburgh. 2015. Dubbed a “super-giant” find by energy companies, Marcellus Shale is now thought to contain 500 trillion cubic feet of natural gas. The plant will employ about 600 people permanently. Additionally, in October of 2014 Chevron announced a $20M donation to workforce development and STEM education in the Pittsburgh tri-state area.

17 HEALTHCARE & LIFE SCIENCES With a total annual payroll of $6.8 billion and 106,000 employees, health services healthier, stronger communities, including the greater community of is by far the largest industry subcluster in the Pittsburgh area. Other industries Pittsburgh which has benefited immensely from Highmark’s presence. that comprise the life sciences include bioresearch establishments, pharmaceutical companies, and medical equipment and supply manufacturers. The Pittsburgh Life Sciences Greenhouse is an investment firm that According to the Pittsburgh Regional Alliance, in the healthcare and life sciences specifically provides resources and tools to entrepreneurial life sector there are over 132,000 people employed in 5,400 firms with 114 sciences enterprises in Pittsburgh to advanced research and patient expansions and relocations since 2007. There is a $700M+ annual investment care. Since PLSG began operations in 2002, it has assisted more than in life sciences research and development in the Pittsburgh area, and over 435 life science companies and has affected more than 10,000 jobs in 4,700 healthcare-related degrees annually. the greater Pittsburgh area. PLSG has provided 34 companies with office or laboratory space, and 14 have been relocated to Pittsburgh Two of the most prominent players in Pittsburgh’s healthcare industry are from outside of the region. PLSG has invested over $20 million in 77 UPMC and Highmark. UPMC is the number one hospital system in Pennsylvania, companies, which has leveraged over $1.5 billion in additional capital to as well as the largest non-governmental employer, with over 65,000 employees. the region. A nonprofit that melds an unwavering community mission with entrepreneurial business models, UPMC is also a recognized innovator in medical information in the United States through its business in health insurance, dental insurance, vision care and insurance. UPMC operates more than 25 academic, community, and specialty hospitals, 600 doctors’ offices and outpatient sites, employs 3,600 physicians, and offers an array of rehabilitation, retirement, and long-term care facilities. It is currently ranked No. 12 in the nation on the U.S. News & World Report Honor Roll of America’s Best Hospitals – with 15 adult specialties ranked. Highmark Inc. and its affiliates operate health insurance technology. Highmark is a national, diversified health care partner based in Pittsburgh that serves members across the United States through its businesses in health insurance, dental insurance, vision care and reinsurance. Highmark and its affiliates operate health insurance plans in Pennsylvania, Delaware and West Virginia that serve 5.2 million members and employ approximately 18,000 people. Highmark is among the largest health insurers in the United States and is the fourth largest Blue Cross and Blue Shield-affiliated company. Highmark is an independent licensee of Blue Cross and Blue Shield Association, an association of independent Blue Cross and Blue Shield companies. 2015 consolidated revenues for the organization were $17.7 billion. For 75 years, Highmark has helped build

18 TECHNOLOGY & ROBOTICS Outside of Silicon Valley, Pittsburgh has the second largest technology and robotics sector in the United States. According to the Pittsburgh Technology Council, technology companies are responsible for roughly 23% of the area’s workforce. These companies account for about 34% of all wages in the region with a payroll of $20.7 billion annually. According to the Pittsburgh Regional Alliance, there are over 28,000 tech employees in Pittsburgh spread throughout 1,500 firms. There has been $1.8B in tech related venture capital investment and $1.1B investment in university math and computer science since 2005. Pittsburgh boasts 2,600 IT degree graduates annually, making the region #2 in U.S. for IT degrees.

There have been several significant technology investments in the Pittsburgh area, including ANSYS, Apple, Google, IBM, Intel Research Pittsburgh, Oculus (Facebook), and Uber. Uber has also made significant investments in Pittsburgh, particularly with its self-driving robotics car program. Pittsburgh was chosen as the pilot location Google’s 250,000 SF east end office, built from the existing Bakery Square for the driverless car program of Uber, who has hired over 700 employees in building with renovations complete in 2015, is of particular impact to the the city, including more than 40 engineers from Carnegie Mellon University’s Pittsburgh technology scene. Google has been building an engineering National Robotics Engineering Center. presence in Pittsburgh since 2005. The combination of a strong tech ecosystem and rich pipeline of world-class talent has allowed Google to ADVANCED MANUFACTURING continue to grow from two engineers to over 300 in the Pittsburgh area. Manufacturing has always been a vital asset to the Pittsburgh region’s economy. For more than 150 years, the region has benefited from a skilled workforce, excellent transportation infrastructure, and an extensive inventory of industrial sites and buildings. Today, advanced manufacturing powers world-class strengths in the growing fields of additive manufacturing, engineering, information technology and robotics. Global manufacturing firms as well as smaller precision tooling and machining companies are both meeting worldwide demand for a vast spectrum of goods, including materials, parts and components for some of the most critical industries. Much of the modern world was built with Pittsburgh-made steel and specialty metals – two historic commodities that put the region on the global map. While grounded in a rich history, manufacturing today is focused on using its core strengths to further future emerging opportunities. 19 Two additional attractions for the City of Pittsburgh are Tourism and Educational based on conventions, outdoor activities, the sports industry, and a Institutions. blossoming array of food and dining options position the Steel City for success.

Pittsburgh has an exciting sports scene, with three major sports franchises: the Pittsburgh Steelers in football, the Pittsburgh Pirates in baseball, and the Pittsburgh Penguins in hockey. Strong fan bases not only throughout the region, but the country, contribute to sports tourism being the second largest source of business for Pittsburgh.

The largest source of tourism business for Pittsburgh is conventions. Located in Downtown Pittsburgh, the David L. Lawrence Convention Center. Pittsburgh also offers countless options for enjoying the outdoors. The Steel City is also a green city – not just because of its environmentally friendly buildings and city programs, but because of TOURISM its parks. Pittsburgh has five city parks totaling almost 2,000 acres of city land, not counting the rivers and state parks also within city limits. Pittsburgh has become a destination city for tourists of all ages looking for a The Pittsburgh area is home to some of the most diverse landscape in variety of activities. A total of $7.8 billion in tourism revenue flowed into the the United States. Pittsburgh’s parks offer hiking, biking, hunting, Pittsburgh region in 2014, and more than 40,250 jobs in Allegheny County are fishing, horseback riding, and canoeing to their visitors. directly supported by this industry. A thriving and vibrant tourism sphere

20 EDUCATIONAL & INSTITUTIONAL Part of Pittsburgh’s allure for a variety of industries are its two premier educational institutions: the University of Pittsburgh and Carnegie Mellon University. University of Pittsburgh, affectionately known as “PITT”, was rated the 47th best university in the world by U.S. News & World Report, PITT ranks in the very top cluster of U.S. public research universities, from research achievements to the quality of its academic programs. University of Pittsburgh alumni have pioneered magnetic resonance imaging and television, won Nobels and Pulitzers, led corporations and universities, served in government and the military, conquered Hollywood and The New York Times bestsellers list, and won Super Bowls and NBA championships. Additionally, PITT enjoys a significant number of accolades: the university ranks ninth nationally in federal science and engineering funding, according to a report from the National Science Foundation, and ranks fifth among U.S. universities in terms of the competitive grants awarded to members of its faculty by the National Institutes of Health. PITT is among the top universities in the world and is the best public university in the Northeast, according to the 2016 Wall Street Journal/Times Higher Education College Rankings. PITT is also included in the Princeton Review’s 2017 listing of The Best 381 Colleges, which features the top 15 percent of the nation’s four-year colleges.

Pittsburgh is also home to Carnegie Mellon University, a prestigious private global research university that stands among the world’s most renowned educational institutions. With cutting-edge brain science, path-breaking performances, innovative start-ups, driverless cars, big data, big ambitions, Nobel and Turing prizes, hands-on learning, and a whole lot of robots, Carnegie Mellon is at the forefront of innovation. Carnegie Mellon ranked #1 of America’s Best Graduate Programs in Computer Science according to U.S. News and World Report, and the #22 University in the World by Times Higher Education. Carnegie Mellon and the University of Pittsburgh have combined efforts and collaborated to now collectively bring in over $1.3 billion in annual research and development funding to the Pittsburgh area.

TOP 3

BEST CITIES IN THE U.S. FOR FIRST-TIME HOMEBUYERS –LENDING TREE ONE OF THE “ “BEST CITIES FOR JOBS –WALLETHUB

AMONG THE TOP 25 COLLEGE TOWNS IN THE NATION –WALLETHUB

22 AREA DEMOGRAPHICS 1 MILE 3 MILES 5 MILES 10 MILES Population Estimated Population 2019 14,786 86,100 213,565 759,893 Projected Population 2024 15,406 86,931 214,482 756,049 Census Population 2010 15,451 88,916 215,614 763,489 Census Population 2000 17,018 98,123 232,618 796,366 Projected Annual Growth 2019 - 2024 620 0.8% 831 0.2% 917 -% -3,845 -0.1% Historical Annual Growth 2010 - 2019 -665 -0.5% -2,816 -0.4% -2,049 -0.1% -3,596 -% Historical Annual Growth 2000 - 2010 -1,567 -0.9% -9,207 -0.9% -17,004 -0.7% -32,877 -0.4% Estimated Population Density 2019 4,709 Per Sq. Mile 3,047 Per Sq. Mile 2,720 Per Sq. Mile 2,420 Per Sq. Mile Trade Area Size 3.1 Square Mile 28.3 Square Mile 78.5 Square Mile 314.0 Square Mile

Households Estimated Households 2019 6,856 40,595 100,401 352,516 Projected Households 2024 7,259 41,603 102,437 356,080 Census Households 2010 6,805 39,820 95,966 336,481 Census Households 2000 7,309 41,959 98,656 338,265 Projected Annual Growth 2019 - 2024 403 1.2% 1,009 0.5% 2,036 0.4% 3,564 0.2% Historical Annual Change 2000 - 2019 -454 -0.3% -1,364 -0.2% 1,745 - 14,251 0.2%

Average Household Income Estimated Average Household Income $52,483 $67,034 $77,264 $88,720 2019 $58,515 $82,001 $93,972 $108,832 Projected Average Household Income $39,046 $50,609 $56,080 $66,323 2024 $35,743 $41,839 $44,908 $53,047 Census Average Household Income 2010 $6,032 2.3% $14,966 4.5% $16,709 4.3% $20,113 4.5% Census Average Household Income 2000 $16,740 2.5% $25,195 3.2% $32,356 3.8% $35,672 3.5%

Per Capita Income Estimated Per Capita Income (2019) $24,476 $32,115 $36,944 $41,479 Projected Per Capita Income (2024) $27,705 $39,748 $45,499 $51,581 Census Per Capita Income (2010) $17,196 $22,664 $24,960 $29,230 Census Per Capita Income (2000) $15,249 $17,838 $18,962 $22,465 Projected Annual Change (2019 - 2024) $3,228 2.6% $7,633 4.8% $8,556 4.6% $10,102 4.9% Historical Annual Change (2000 - 2019) $9,227 3.2% $14,277 4.2% $17,981 5.0% $19,014 4.5% Estimated Average Household Net Worth $380,077 $513,513 $636,846 $797,359 (2019)

Employment Total Businesses 488 2,951 13,932 39,880 Total Employees 4,728 35,299 271,874 682,604

23 SALES COMPS

PROPERTY AREA SIZE (SF) SALE PRICE PRICE/SF SALE DATE

511 Industry Road McKeesport 21,000 $4,329,881 $206 10/19

4609 Butler Street Lawrenceville 6,000 $670,000 $112 10/19

120 Beta Drive O'Hara 49,368 $6,250,000 $127 4/19

20 Wesco Drive Export 7,276 $1,655,000 $227 1/19

55 Mayview Road Lawrence 18,000 $1,900,000 $106 2/18

65 Warrendale Road Warrendale 11,488 $1,375,000 $120 10/17

2596 Washington Road Canonsburg 6,942 $1,050,000 $151 9/17

24 CONTACT US GREGG BROUJOS REGIONAL PRINCIPAL | PITTSBURGH INVESTMENT SERVICES DIR 412 515 8523 MOBILE 412 512 1611 [email protected]

MICHELLE DOMEISEN SIOR, CCIM SENIOR VICE PRESIDENT | PITTSBURGH INVESTMENT SERVICES DIR 412 515 8544 MOBILE 412 680 0340 [email protected]

Colliers International | Pittsburgh 525 William Penn Place Suite 3510 Pittsburgh, PA 15219 412 321 4200

@COLLIERS_PIT

BLOG COLLIERSINTERNATIONALPITTSBURGH.COM