Pens halt arena site plans

The Pittsburgh Penguins are halting development activities at the former Civic Arena site after the city’s Urban Redevelopment Authority board delayed a vote Thursday on plans for a new headquarters for First National Bank.

In a statement after the vote, Penguins CEO David Morehouse said developing the 28acre lower Hill District site has become “increasingly impossible” given “changing demands and delays.” The team holds the development rights to the land.

“In a week where the Penguins had to furlough a majority of our employees and we are all suffering the worst health and economic crisis in our nation’s history, we are disappointed that the URA delayed a $200 million development project that alone would create 1,500 construction jobs, 2,000 permanent jobs, deliver the highest commitments to minority and women owned businesses in the city’s history, and generate $11 million in direct and immediate investment into the middle and upper Hill District,” Mr. Morehouse said.

“At this point, given the current economic conditions and the apparent lack of support from the URA, we are ceasing our development operations on the lower Hill,” he added.

Mr. Morehouse’s comments came after the five-member URA board voted unanimously to table preliminary approval of conceptual plans for the 26-story office tower for up to two weeks to give Hill residents more time to digest some of the details related to the project and community benefits.

In doing so, it effectively put on hold a vote by Sports & Exhibition Authority board members earlier Thursday giving

preliminary approval to the plans for the $221 million office tower to be built on the west end of the site closest to Downtown.

SEA board members made their approval contingent on the project winning the support of their URA counterparts. The two authorities own different parts of the lower Hill tract.

In calling for the delay, URA board member R. Daniel Lavelle, a city councilman who represents the Hill, said a lot of details related to the project and community benefits arrived in just the last few days. That did not give residents enough time to review them, he said.

Community members also had concerns they wanted to address with the Penguins and their developer, the Buccini/Pollin Group, “and I think they should be afforded that time and not necessarily be rushed at this moment,” Mr. Lavelle added.

The delay came even though FNB, as part of the project, had pledged to advance $8 million in funding to be used for development in other parts of the Hill and another $3 million for Hillrelated housing.

That money would be repaid through Local Economic Revitalization Tax Assistance (LERTA) program tax abatements and parking tax diversions related to the construction of an 850-space parking garage.

Hill leaders and the URA did not receive the final term sheet outlining those commitments until Thursday — one of the reasons for the delay, said Dan Gilman, chief of staff for Mayor Bill Peduto.

Despite the Penguins’ decision to halt development, Mr. Gilman believes the issues causing the delay still can be worked out.

“We’re in contact with the Penguins. We still believe this is a project that is deliverable and a win for the neighborhood, the city and the Penguins, and we remain committed to working with them to get this deal done in the coming days,” he said.

Mr. Lavelle could not be reached for comment after the Penguins’ announcement.

In asking for the delay, he said his intent was “to see this development happen.” But he noted that he wanted to make sure what was promised to the community is delivered.

“What I’m saying is we need another week or two to pause, take a moment to make sure that all of what we think is in place to ensure that this development is equally beneficial to the greater and upper Hill District is actually in place,” he said.

“We need a little more time to be able to vet it, to ensure that this is indeed in line with what the community’s expectations are and that this is indeed the deal that we expect it to be so that it is to the explicit benefit of the larger community, especially those African Americans that have been starved in poverty ever since this government tore down this community.”

Among the others who pushed for a delay was Marimba Milliones, president and CEO of the Hill Community Development Corp.

She said there is still no formal agreement on a number of issues relating to community benefits, including minorityand women-business enterprise inclusion, workforce development and local hiring, and wealth building and cultural and community legacy initiatives.

In addition, Ms. Milliones maintained the Penguins and the Buccini/Pollin Group have yet to meet all of the commitments they made to the community in getting preliminary approvals last fall for the plans for a live music venue, an 850-space parking garage, and the first 288 residential units to be built at the site.

“The good faith that we took just a few short months ago with the same developer has not yet been fulfilled,” she said.

Kevin Acklin, the

Penguins’ senior vice president, said the team has been making progress on all of its commitments, including plans to redevelop the Ammon Rec Center in the Hill and closing the funding gap on the Curtain Call public art project that was supposed to be part of the PPG Paints Arena construction.

“We’re fully cooperating with the community ... and we have a tenant in FNB which has gone above and beyond with respect to their commitments in the Hill District,” he said.

Although URA board chairman Sam Williamson voted for the delay, he seemed conflicted.

He noted the FNB project alone could pump $11 million into other parts of the Hill, including money for affordable housing.

It also has the potential to create quality jobs for Hill residents, with “the strongest and furthest-reaching and most enforceable First Source hiring commitments that I have ever seen on a Pittsburgh development.”

“We are now sitting at a moment when, unlike when we first started talking about these parcels a few months ago, we’ve got 15% unemployment all across this country,” he said.

“This economic crisis is hitting low-income communities and communities of color worse than anyone else, and I think we’ve got to be clear this is a project we want to advance, that we expect to advance, so we can put people to work, so that we can capture those development dollars and put those additional development dollars to work in the Hill District.”

The FNB development, he added, is an “integral project for our recovery from this economic collapse.”

Overall, the Penguins’ proposed $1 billion redevelopment is to hold up to 1,420 units of housing, 810,000 square feet of office space, 190,000 square feet of retail, the music venue, a food hall and the hotel.