'T' line project gets scaled-back ideas in Mt. Lebanon

Mt. Lebanon T Station Monday, February 17, 2014.
Mt. Lebanon T Station Monday, February 17, 2014.
Photo by Heidi Murrin | Tribune-Review
Matthew Santoni
| Wednesday, Feb. 19, 2014, 9:00 p.m.

Where Mt. Lebanon officials once envisioned a residential or office tower and a parking garage rising on a pair of platforms above light-rail lines serving the Washington Road business district, higher-than-expected cost estimates have dampened expectations.

Delta Development Group Inc. completed a market study for the proposed Transit-Oriented Development, originally pitched as a way to use the “air rights” that the defunct Mt. Lebanon Parking Authority owned since the 1980s above the tracks from the Mt. Lebanon Transit Tunnel to Alfred Street.

But the Mechanicsburg-based firm said in a report that the high cost of building over the active Port Authority light-rail line would make a high-density development likely to lose money, unless there were lots of government-backed incentives. Mt. Lebanon officials have set a March 10 hearing to discuss plans for the site.

“It's very challenging to build over an active rail line, and very costly,” said Mt. Lebanon Commercial Districts Manager Eric Milliron, who got the board of commissioners to pay for the market study before seeking developers' proposals. “If building on air rights were easy, there would be these projects all over the place.”

Building one platform as a base for development and the other platform with a parking garage above the Mt. Lebanon station would cost an estimated $27.23 million, according to an earlier engineering study that Mt. Lebanon commissioned.

When combined with the cost to build a seven-story tower with 100 or 160 apartments and 10,000 square feet of retail space, high-density options likely would cost more to build and run than they would return in rent, Delta concluded.

Specifically, the analysis showed a $22.3 million “gap” between cost and value for such a development, said Dan Santoro, a vice president who runs Delta's office in Pine.

“There's no developer in the world who would come in and cover those costs,” he said, noting that grants or tools such as tax increment financing could close the gap slightly.

Milliron said Mt. Lebanon is looking toward a “low-density” option in which 42 apartments, 11 townhouses and 56 underground parking spaces would be built on the small Kiss-and-Ride parking lot and a thin strip of land between the tracks and Shady Drive.

“We see it as a terra-firma project and not an air-rights project at this point,” Milliron said. “We're not saying (high-density) is impossible, but we'll let the development community tell us what they can do.”

The low-density option would forgo using the air rights, would require alternate parking and bus pull-in areas for Port Authority, and would not add more parking for Washington Road businesses, he said. But it would have less of an impact on Port Authority's service than the high-density project, which could have required temporary stoppages during construction.

“I think (the garage) would be a good idea,” said Christopher Weis, 21, of Mt. Lebanon as he waited for a train Monday. “Sometimes, parking Uptown can be a bit of an issue, so more parking would be good.”

Pam Merkle, 44, of Mt. Lebanon, catches a bus at the station four times a day and said she'd welcome a new facility with a more sheltered waiting area. But she said the cost could be passed on to taxpayers if the municipality has to sweeten the deal for developers.

“I think it would bring more people and money to Mt. Lebanon, but it could also bring homeowners' taxes up,” she said.

“The condos could be popular... we have a lot of people around here who want to live in Mt. Lebanon; it's a great area,” said Jessica Johns, a worker at Orbis Caffe on Washington Road, above the proposed development.

The public can learn more about proposals for the site and make suggestions at a 6 p.m. hearing on March 10 in the commission chambers at the municipal building.

The ideas shared will be the final factor in the first request for developers' proposals for the site, which could be sent out in late March or early April, Milliron said. Once general proposals for the site are in, municipal officials will review them, interview the developers and conduct a second round of requests among the “finalists,” he said.

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