$269M Millcraft Plan Wins Fifth & Forbes

PITTSBURGH-Mayor Bob O'Connor has given his nod to Cannonsburg-based Millcraft Industries Inc.'s plan for redevelopment of the Downtown Fifth & Forbes corridor. The plan consists of four identified components scheduled to take place over the next two years, plus additional ones that are yet to be quantified. The aggregate estimated cost is $269 million, according to Lucas Piatt, Millcraft VP.

Piatt Place is already under way and Forbes Village is new construction on parcels owned by the Urban Redevelopment Authority that now contain about 20 buildings. MarketPlace Square is the redevelopment of the former GC Murphy building and Piatt Place Apartments next to Piatt Place. Millcraft will buy the URA land, and Piatt tells GlobeSt.com that URA is in the process of establishing a price. "There will be no local subsidies for the redevelopment." He acknowledges that the company is anticipating some state funding. "We will need it."

Piatt Place is a redevelopment of the former Lazarus department store, and Piatt says he expects occupancy to begin within 12 months. Three stories are being added to the existing four-story structure. The building will contain 47 condominiums, including two-story units he calls "townhouses" on the top floors; 180,000 sf of office space, and 50,000 sf of retail. The estimated cost is $52 million.

Residential units range from 1,000 sf to 3,300 sf, and Piatt says the selling prices will begin at $275 per sf and reach to $300 per sf for the townhouse layouts. Locally based Hartland Homes is Millcraft's joint-venture partner in Piatt Place, and Piatt says the firm will look to partner with others on the additional components of the project. The local offices of CB Richard Ellis and Langholz Wilson Ellis are sharing marketing of the office and retail portions of the project. Piatt says the office rental rate is in the range of $21 per sf and retail is about $35 per sf, triple net.

Forbes Village is new construction, built to qualify for LEEDs green building certification. This component is expected to cost $53 million and will contain 20,000 sf of retail, a 150-car subgrade parking area and 150 residential units that Piatt says will be a mix of for-sale and rental, "probably a 50/50 split."

The MarketPlace Square renovation is expected to cost $21 million and contain 25,000 sf of retail and 50 rental residential units. "These will be affordable market rate," Piatt says and estimates rent rates of between $1.50 per sf and $1.80 per sf per month. "We're committed to affordable housing, even if it's a loss leader."

The 65 rental units in Piatt Place Apartments, adjacent to the redeveloped Lazarus property will command higher rents, he says. This is new construction at an estimated cost of $22 million. It will also contain 7,000 sf of retail. Speaking of all of the retail space, Piatt says there are letters of intent, but no firm tenants just yet. While the additional components of the full redevelopment of the corridor have yet to be defined, it is expected to create an aggregate of more than 850 residences to the corridor along with additional retail.