Pittsburgh looks to use $2.1M to convert Downtown office buildings into residential space

Pittsburgh Mayor Ed Gainey on Friday announced that he will present a measure to allocate $2.1 million in American Rescue Plan Act funding for a project that will convert historic office buildings in Downtown Pittsburgh into residential spaces.

The mayor will present the bill to City Council for approval.

Pittsburgh has about $260 million in ARPA funding that has yet to be allocated, City Controller Michael Lamb said when releasing his popular annual financial report this week. The city received about $335 million in ARPA money in total, and the cash must be used by the end of 2024.

The city would be joining Allegheny County Executive Rich Fitzgerald and state Senators Jay Costa and Wayne Fontana to create a $9 million pilot program that aims to increase affordable workforce housing and support the Downtown neighborhood.

This comes as the covid-19 pandemic spurred a major increase in remote work, leaving many Downtown offices empty. Meanwhile, the city has struggled to increase its affordable housing stock, something the mayor has promised to prioritize.

“The Downtown Conversion Program is a great opportunity to recover from the devastating impacts that covid-19 had on our Downtown commercial buildings,” said Costa, who serves as the Senate minority leader. “Providing funding to assist converting these spaces will jump start the creation of needed and desired residential properties and reinvigorate the Golden Triangle.”

Fontana called the initiative “a bold and innovative idea to ensure that the city continues to drive economic prosperity, while ensuring equitable access to housing.”

Gainey said the city would partner with the Urban Redevelopment Authority to convert a portion of the area’s vacant commercial office space into mixed-income housing developments.

The legislation Gainey is proposing calls for a $2.1 million allocation to the URA for capitalizing the fund. That money would add to the $3 million Pennsylvania has already given the URA for this purpose.

The Downtown Conversion Pilot Program guidelines are still being developed. The URA Board will need to approve them.

“As the market has changed over the past few years, including changes in the office market, we must also adjust,” Fitzgerald said. “The residential market in Downtown and the surrounding areas remains strong and it only makes sense to transition to that need. This effort also invests in the continued vibrancy of Downtown which is the heart of our region.”

The area’s growing residential community also bolsters local retailers and restaurants, said President and CEO of the Pittsburgh Downtown Partnership Jeremy Waldrup. He said that it gives new life to “beautiful historic buildings.”