Jeremy Waldrup thinks downtown Pittsburgh will emerge better from its latest transformation into a place with less commerce and more housing.
“The downtown fundamentals are extremely strong,” says Waldrup, who as president and CEO of Downtown Pittsburgh Partnership, interacts with business owners, residents, visitors and decision makers. “People want to live in neighborhoods that are walkable and they appreciate the accessibility that the city center offers to cultural and sporting events. Working from home will make this more appealing to some. They want the opportunity to go out on the town and meet new people.
Several large housing projects are planned or underway in the Golden Triangle – the latest, 254 apartments proposed for the former GNC headquarters – but like many post-Covid city centers, the neighborhood is struggling to return. Its daily user level, measured by cellphone pings, remains well below 2019 statistics, according to Waldrup — around 77,000 people now, down from 137,000 a day before the pandemic.
“I think it will be a challenge for every downtown to deal with this new normal of shrinking workers,” he says. “I know we joke that Mondays and Fridays are really slow downtown these days, and I think that’s most likely going to stay for a while.”
The number of employees and visitors coming downtown may never return to pre-pandemic levels because “working from home has changed the way people react when entering the office,” Waldrup says. At around 66%, Pittsburgh has some of the highest rates of commercial office space as a percentage of total downtown real estate — fifth in the nation behind Boston, San Francisco, Washington, DC and Chicago.
“About 40% of our office space is historic stock, so it’s buildings from the turn of the last century that are absolutely beautiful, but a lot of it in the future won’t need to be commercial office anymore. “says Waldrup. “This is a real opportunity to start making the city center more resilient and diverse. We think residential is an important part of that.
The luxury apartments in the former Kaufmann’s store, now Kaufmann’s Grand on Fifth, are 100% full with a waiting list. On July 17, Target opened a 22,000 square foot department store with a full-service grocery store. This will complement the smaller grocery sections of the five downtown pharmacies and DGX on Wood Street, as well as Market St. Grocery, which opened in 2015.
Earlier this month, Mayor Ed Gainey and Allegheny County Executive Rich Fitzgerald announced the city, county and state would create a $9 million pilot program aimed at increasing supply of affordable workforce housing, beginning with a $2.1 million allocation of American Rescue Plan Act funding to the Pittsburgh Urban Redevelopment Authority (URA). The state pays $3 million.
“As the market has changed over the past few years, including changes in the office market, we also have to adapt,” says Fitzgerald. “The residential market in downtown and surrounding areas remains strong and it makes sense to transition to this need. This effort also invests in the continued vibrancy of downtown, which is the heart of our region.
The guidelines for the downtown conversion pilot program are still being developed, says Gainey, but the goal is “to enhance the vitality of downtown Pittsburgh by converting a portion of vacant commercial office space into mixed-income developments that include affordable and workforce housing”.
Already, about 7,000 people live in the Golden Triangle in 4,100 units — about 94% occupancy, says Waldrup. “We’ve added about 1,600 units over the last six years or so, and occupancy rates are as good or better than they were pre-Covid,” he says.
Developing so-called “workforce housing” means creating affordable living spaces for young professionals and those in retail, food service, theater and other industries Services. About 62% of those who work downtown earn less than $70,000 a year, Waldrup says. The program would provide a subsidy to developers to offer at least 10% of units at reduced rent for a specified period.
New York-based real estate firm Victrix LLC will convert the GNC building on Sixth Avenue into apartments, with first-floor retail space and a rooftop terrace. According the plan which Strada Architecture submitted to the Pittsburgh Planning Commission, Victrix will retain the entire envelope of the 14-story building designed by architect Daniel Burnham and reconstruct the interior in approximately 15 months. GNC moved its headquarters to the Strip District in June.
With this development and others, “more than 800 units are currently in the pipeline for construction downtown,” Waldrup said.
Other recently announced developments include City Club Apartments in Pittsburgh’s former YWCA building on Wood Street – 300 apartments in a 20-story tower. Developed by Indovina Associates Architects, the plan features a two-story restaurant, health club and rooftop pool — 10% of these apartments will be for affordable housing.
“It’s a great reuse of that space,” says Waldrup.
And earlier this year, Washington, DC-based Douglas Development announced plans to develop 139 apartments in a long-abandoned building on Fort Duquesne Boulevard that was home to the Easter Seals of Pennsylvania.
“We think there’s also an environmental component to all of this,” says Waldrup. “You’re using existing real estate, underutilized real estate, and if you’re a two-car family moving downtown, you might get rid of one or both cars. There are opportunities for transportation public, as well as Uber, biking or walking.