Penguins 'Assume More Risk' In Tentative Lower Hill Development Deal

Nov 6, 2017

The City of Pittsburgh has reached a tentative deal with the Pittsburgh Penguins on redevelopment of the Lower Hill District. 

After more than two years of delays, the 28-acre site could soon see shovels in the ground, according to a release from the city.

The agreement will “kick-start” $750 million worth of private investment, which is slated to include 500,000 square feet of office space and 250,000 square feet for entertainment and retail.

An unnamed minority developer will build more than 1,000 units of housing, 20 percent of which could be affordable to people making 60 percent of the area median income. That represents a greater level of affordability than was originally planned, but less than what some community advocates hoped for.

A $15 million credit promised to the Penguins in the original deal, signed in 2007, was blamed for delays and difficult negotiations. The Penguins agreed to give up those credits in exchange for a more flexible timeline for development.

Chief development officer Kevin Acklin said he knows the public has been frustrated by delays.

“This is an agreement that’s good for the city, that advances development, that holds the Penguins accountable and that also we feel can move things together forward more quickly,” Acklin said.

The organization must develop 6.25 acres by 2020, but won’t lose their development rights as a result of any delays. Instead, they will give up some of the parking revenue generated on the site.

“The Penguins have assumed a lot more risk,” Acklin said.

A parcel of land will be returned to public control to build a parking garage. Up to 10 percent of parking fees will be contributed to the Greater Hill District Reinvestment Fund, which is meant to help finance revitalization in the economically struggling neighborhood.

About 8,000 people were displaced from the Lower Hill for a cultural district in the 1950s that never materialized. The Civic Arena was later erected and replaced by PPG Paints Arena.

The boards of the Urban Redevelopment Authority and the Sports and Exhibition Authority will have vote on the changes to the plan this Thursday. 

Photo credit: KitAy / Flickr