Month: July 2016

Could It Be Amazon?

A trip by the airport yesterday revealed a major dust cloud pluming up from the Chapman Westport development. After stopping by the project site, I found a massive excavation job being undertaken. A little digging around at Findlay Township’s offices uncovered applications by Chapman Properties for four items to be acted upon at the July 26 planning commission meeting. Those actions included the subdivision of 427.4 acres, including the creation of an 84.6 acre parcel, labeled Parcel A. There is also the application for approval of a land development on that parcel that involves construction of a 1,015,740 square foot warehouse/office, along with a 48,000 square foot building on another parcel.

That’s not a typo. There are two commas in that warehouse square footage.

Last week’s Pittsburgh 2Q2016 Industrial Market Report by Newmark Grubb Knight Frank alluded to a million square foot user in the market without naming the company. It would seem that user has landed. Tony Rosenberger, Chapman’s president, politely acknowledged that Chapman was planning a 48,000 square foot spec building – known as 110 Building – and that Foley Excavating was doing a major dirt job to prepare for the expansion of the Westport park. Beyond that, he had no comment on the construction or the applications to Findlay Township. Of course, I would have been shocked if he had.

There aren’t that many million-square-foot users out there. Civic leaders have speculated about those kinds of companies following the Shell cracker as downstream manufacturers; but with the plant’s opening date set for “early next decade,” it seems unlikely that a related plant would be getting underway now. The proximity of the site to GE Plastic’s new facility gets the imagination spinning but, again, it seems unlikely that GE could have created enough economic activity in six months to have spawned a million-square-foot neighbor. The most likely user at Westport is Amazon, especially since Dick’s Sporting Goods announced today that it was building its big distribution center in Conklin, NY.

When Amazon signed the lease for 250,000 square feet in Crafton back in Summer 2014, logistics experts talked about the “Amazon effect” that would attract other big distribution and fulfillment companies. But at the time, the brokerage community talked about the deal as being a search for 250,000 to 300,000 sqaure feet with future need for a million or more. That’s the size that is typically associated with Amazon Robotics’ fulfillment centers, which employ as many as 1,000 people.

Perhaps the end user will be revealed at the Findlay Township planning commission meeting, although that wouldn’t be necessary for the review or approval. In some ways, it could be even better if it’s another big company, since it would make Pittsburgh that much more attractive to kindred businesses. Chances are it won’t be a secret long.

June Jobs: Not Such a Surprise

Friday’s June jobs report was not the surprise that business media made it to be. Employers added 287,000 new hires in June, according to the Bureau of Labor Statistics, which was well above the 175,000 consensus estimate, but the long-term trend is a strong one and the big jump in June was merely a reversion to the mean. It’s also not a surprise that the trend continues to move lower as economic expansion reaches its eighth year.
Within the report were two noteworthy items. First, the categories of employment that grew the most were higher-paying sectors like IT, education and health services and professional services. Second was the continued growth in wages. Pegged only one-tenth percent higher in June compared to May, wages were nonetheless 2.6 percent higher year-over-year. That represents healthy growth over price inflation and a steady – if unspectacular – trend upward over the past year.
job creation history
In project news, Turner Construction was selected by the RIDC to perform preconstruction services for a 65,000 square foot commercial building planned for Almono in Hazelwood. Dick Building Co. was awarded the 104-room, $12 million Hotel Indigo proposed for Second Avenue.

Some Small Project Updates

Tuesday’s bid results for the new playing fields at Pitt’s Trees Hall were very tight. The bids were for the largest piece of the $12.5 million upgrade. The 3 lowest bids were:

Mosites:    $8,377,222

PJ Dick:    $8,400,000

Mascaro:    $8,495,000

City Works Restaurant was awarded to A. Martini & Co. The $2.5 million buildout will take 10,750 square feet in 2 PPG Place. Martini was also successful in landing the $2.2 million tenant improvement for Eckert Seamans, which is renewing its lease for 89,500 square feet in USSteel Tower.

IMG_1148 hi res-crop
Massaro Corp. broke ground last week on the $13.7 million UPMC Hampton ambulatory center. Photo courtesy IKM Inc.

RIDC is in the process of selecting a pre-construction manager to help with the planning of its 65,000 square foot first building at Almono in Hazelwood. Vertical construction won’t occur until late 2016 or 2017.