Could the news be any worse? PNC is putting up 2/3 of the cost of a new downtown skyscraper, and the state is putting up the rest. PNC's Jim Rohr said that without public help, the project would not be feasible. Jim Rohr's comment means that PNC knows that this will never be a money-making project on a stand-alone, private basis. Local developers understand that the 1950s economics of large office tower developments (mom stays home, dad commutes downtown) are, at long last, behind us. The Downtown market doesn't need a new tower; the business community isn't crying out for more office space; the public couldn't care less about bright new buildings for corporate tenants. So why build a skyscraper?
Hypothesis one: Downtown is dead; long live Downtown! Maybe PNC doesn't actually want to build this building, and it won't actually get built. The announcement is intended to galvanize developer support for smaller-scale Fifth-and-Forbes residential and retail development, and maybe even for a new arena. Is this what the state and the city really want, and did they persuade PNC to go along? Is this what the Governor meant when he said, "I think we will mark this day as the day Downtown Pittsburgh turned around for good, once and for all"?
Hypothesis two: Downtown is dead; let's drive a stake through its heart. Maybe PNC really is leading this effort; it wants to build a building that will fail so spectacularly that PNC has an obvious excuse to claim that the region has no economic future -- as PNC walks out the door to Charlotte.
Hypothesis three: Downtown is alive and well and holds the key to the region's future. Maybe Pittsburgh's public and private "leaders" really are so clueless that they think that a new skyscraper, with an international law firm as the anchor tenant, will galvanize the Pittsburgh economy for the long term.
Turning Pittsburgh into 1920s New York, with more and better skyscrapers, is a step backwards for the city and for the region. Dumping public money into large-scale Downtown development is throwing good money after bad. It's top-down romance -- let's rebuild the glory days of old Pittsburgh, with lavish digs for big business -- masquerading as bottom-up progress. Any way you cut it, this is a vertical Potemkin village.
9 comments:
I don't agree with your assertion that this building is BAD for the city. There hasn't been a major building go up in town for a long time, and, like it or not, that's what modern cities are about. So, it is a positive sign for downtown, along with ALL the condo development. BTW - did you notice that the building will contain condos, too?
I am, however, ticked off that my tax dollars are going into the deal. Come on! If this isn't an economically viable project, why are they doing it? Of course I can't blame PNC for taking "free" money!
I don't buy the premise that we have to throw public money into private projects just to keep up with the municipal Joneses. If PNC wants to pursue this deal, let it, but putting public money in makes the statement that this is the future of Pittsburgh -- and that's a mistake.
I agree with you. The whole rah-rah PG article was rather sickmaking. The public funding aside, has anyone asked any aesthetic questions about the project? Such as which 13 buildings are being demolished, and how will that affect the architectural texture of downtown? Or how were the architects and the design chosen? Was there a national competition for such a prominent building? Frankly,it looks hideous - it may have the soul of a Potemkin village, but it has the looks of Coop City.
Governor Rendell's comment aside, I doubt anyone is really thinking this is a "magic bullet;" at least I hope not. This is small change spent on downtown compared to my old home of Charlotte, NC. There, hundreds of millions of public funds have been spent downtown (almost 300M for an NBA arena alone) despite the fact that Charlotte is more than able to attract residents and business with no help from the government. Does this make it right for Pittsburgh to do the same thing? No, but it's hard to see how Pittsburgh can compete with the sunbelt cities if it's not willing to spend even a paltry 23M on downtown developement.
Not to put too fine a point on it, but Anti-Rust had it right with:
"If Downtown Pittsburgh is undergoing a third renaissance, half of the people who live in the city should pack up and leave. That is what they did in response to the first two renaissances."
Huh? Half the people moved out of downtown because of renaissance II? I doubt there are numbers to support that.
This project is interesting in another sense that isn’t talked about. This is the first big building planned for downtown since the city eliminated the split tax it had for a century. By taxing land at a rate 6 times that placed on structures, the purpose was to encourage high density development like this. After the reassessment a few years ago the city eliminated the split tax which meant the tax burden on large structures went up significantly, possibly 100% or more for a tall, low footprint structure like this. There was a question whether there would be any future developments like this in the city.
Consider.. If this building gets assessed at 200 mil say, the extra tax because of the elimination of the split tax could be $1-2 mil or more depending. Just something to think about but, if true, the TIF amounts being talked about may not even be enough to revert the total tax bill on this structure to what it would have been just a few years ago. The state funding is another issue. I wonder whether this deal is dependent on comprehensive property tax reform which has the potential for helping high tax rate municipalities (i.e. the city) the most.
and.. all l I know is what I read, but PG didn’t say there was a City of Pittsburgh TIF involved.. school district yes, but not city which is interesting.
That'll show PNC (I know there's a Rohr/Roar opportunity here, but I'm spent)
http://postgazette.com/pg/05355/625868.stm
I personally love the thought of all of the residential living in downtown Pittsburgh. As a young professional working for one of the larger corporations in Pittsburgh -- I wish I could afford to live downtown. When you look at the costs of all the living downtown it is impossible for anyone who aren't deeply established in their career to afford the costs of living downtown. It amazes me that it costs as much to live in downtown Pittsburgh as a city like Chicago. It is not quite as costly as New York -- but it is pretty damn close! If anyone knows how the youth can afford to live in some of these new downtown developments share the knowledge!
As a Chicago resident, I suspect "Anonymous" above is smokin' something if he thinks living in downtown Pittsburgh costs as much as livng in *any* safe and decent neighborhood in Chicago, much less in "downtown" Chicago. When I lived in Chicago Proper, my rent on a 1-bedroom apartment was $1,100 a month -- and I lived 8 miles away from downtown, the Pittsburgh equivalent to living in, say, Regent Square or Highland Park. And that was 4 years ago, and real estate values in that neighborhood have gone up about 70% since. Single-family homes in need of rehabbing in my neighborhood sold for $400,000 to $600,000. Again, this is EIGHT MILES from downtown, four years ago. 1-bedroom highrise condos in downtown Pittsburgh start at under a hundred grand. By contrast, if you want to live anywhere *near* the Loop, be prepared to spend $200,000 for a cramped starter unit. If you're *really* lucky, maybe you'll find one at that price that actually has a separate full bedroom. (Want a second bedroom? Pony up another hundred grand.) That kind of scratch will buy you a 4-bedroom, 3000sqft, 3-story, move-in-ready rowhouse in Mexican War Streets and other nearby North Side areas where downtown is literally right out your window. Equivalent rowhouses in Chicago's Gold Coast (similarly close to downtown as Mexican War Streets) sell for MILLIONS. Pittsburgh may have its disadvantages, but unattainable real estate prices is CERTAINLY not one of 'em.
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