Development Plans For Former Penn Plaza Site Again On The Move

Jan 29, 2019

Developer LG Realty Advisors presented final plans for the first phase of work at the former Penn Plaza site to the Pittsburgh Planning Commission on Tuesday. The company intends to build more than 300,000 square feet of office and retail space in the first of two phases of development on the roughly nine-acre site in East Liberty.

During the briefing, company officials showed drawings that included a fictional store called “East Liberty Market” to illustrate how an anchor tenant may activate the Penn Avenue side of the development. The logo resembled that of Whole Foods Market.

Company president Larry Gumberg said they have just begun to advertise the space and do not have any tenants lined up.

“We hope that Whole Foods will come back to the project but they stepped away, what, two years ago,” he said. “They pretty much said, ‘When the City of Pittsburgh figures out what it is that it’s going to allow you to do, you know, call us.’”

Whole Foods left the development in response to gentrification concerns. For many years Penn Plaza was home to tenants with low incomes, but in 2015 they were told their leases would not be renewed. Ultimately, the developer, the city, and nonprofits worked to help residents find new homes over an 18-month timeline. The event sparked an ongoing, contentious discussion about affordable housing and accessibility in Pittsburgh. 

LG Realty’s plans at one time included market-rate housing, but those apartments were taken off the table nearly two years ago. Instead, LG Realty will direct some of the tax revenue generated by the site to public improvements.

That arrangement was reached in October 2017 after hours of mediation and a court order. Up to $1 million will be used to improve the public Enright Park; company representatives estimate that up to $10 million will be contributed to an account called the East End Housing Regeneration Fund. Its proposed use is to help developers finance construction of affordable housing. An advisory committee composed of four community groups will decide how to spend that money.

Housing advocates continue to reject plans for the site. Randall Taylor is a member of the Penn Plaza Support and Action Coalition, and a candidate for City Council. He said the proposed development will result in blight.

“It’ll sit vacant. We already have vacant office space in East Liberty,” he said. “This will be more vacant space and vacant properties are blight.”

During phase one of the development LG Realty intends to build a nine-level building that includes more than 50,000 square feet of retail space and nearly 250,000 square feet of office space. One commission member asked if any office space or community space would be given to neighborhood groups. A lawyer for the company said no (the courts struck down a similar request made by the Planning Commission last year).

In two weeks the Planning Commission will take a final vote on the project's first phase. The commission will also take public comment at that meeting.

LG Realty will have to return to the Planning Commission before it can embark on phase two of the project.

This story was updated at 11:21 on 1/30/19 to clarify the circumstances under which Penn Plaza tenants relocated.