Downtown: Apartments surge, condo market fades

Pittsburgh Post-Gazette - June 26, 2011
By Mark Belko

Apartments are in, condos are out, in Downtown.

After a condominium building splurge five to six years ago, developers are now bullish on apartments, in large part because of financing and market realities.

The two largest residential projects taking place Downtown right now involve apartments -- 218 units at the former State Office Building on Liberty Avenue and 158 units at the old Verizon Building on Stanwix Street.

Foris Property Group is planning another 29 units on Penn Avenue. The 297-unit Cork Factory, which is filled up, is adding 96 more units in the Strip District.

In all, more than 500 apartment units are now in the pipeline Downtown and in the Strip compared to, at tops, 26 condominiums, according to statistics compiled by the Pittsburgh Downtown Partnership.

Experts say the shift to apartment building is in some respects a lingering hangover from the housing crash and credit market freeze several years ago.

Mortgages are still tough to come by, and in many cases condo buyers are facing down payments totaling 20 percent or more. In addition, it is much harder for developers to obtain financing for condominium projects than for apartment construction.

"I think the [condo] market has just soured nationally," said Lucas Piatt, chief operating officer for Millcraft Industries, which is converting the State Office Building to apartments. "It's pretty strong in Pittsburgh but nationally the for-sale market has not rebounded." 

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