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PITTSBURGH-Los Angeles-based Mika Realty has acquired the 594,984-sf historic Union Trust Building at 501 Grant St. for $25 million. The 11-story Gothic-style structure, which was built in 1916, went on the sales block approximately a year ago by Teal Rock 501 Grant Street LP, an affiliate of Philadelphia-based Cigna Corp., which acquired it in foreclosure.

Also known as Two Mellon Center, it served as headquarters for Mellon Financial Corp. However, Mellon failed to renew its lease in the second quarter of 2006, leaving the building vacant except for portions of its ground floor retail. Jeffrey Ackerman, EVP of the local office of CB Richard Ellis, led the investment property team that marketed the building and identified the buyer.

“It is a spectacular building, full of history and charm, and represents a unique period in Pittsburgh history, a time when buildings were built with grandeur and dignity,” says Richard Barreca, a Mika principal, in a statement. Among its notable architectural details are a rotunda with a stained glass dome, two chapel-like towers and a steeply pitched mansard roof. From 1985 to 1987, Mellon invested significant capital to update the HVAC and communications systems in the building.

Mika has handed the office leasing assignment to Jeremy Kronman, a CBRE EVP, and the retail leasing to Herky Pollock, also a CBRE EVP here. Kronman tells GlobeSt.com that Mika is upgrading the building to Silver LEED certification standards. He says, “as a starting point, Mika is investing approximately $100 per sf in upgrades, which will put the investment at in excess of $60 million.”

The asking rent rate for office space is $23.50 per sf, according to Kronman, who says, “we have had interest and tours representing more space than is available, and we are in negotiations for tenant occupancy this fourth quarter. The retail portion is rapidly re-tenanting,” he adds, “and new tenants will be named within weeks.”

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