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Luring high-end retailers the goal for Downtown partnership
But group tries different strategy to match stores, property owners
Tuesday, August 19, 2008

The Pittsburgh Downtown Partnership plans to play a major role in the next effort to draw high-end retailers into the Golden Triangle.

But the partnership wants to take a different approach than in the past, when the city tried for several years to engage one developer in a mega-project to redo the entire corridor.

The partnership wants to match retailers with individual property owners, much as it did to attract several new businesses to Market Square earlier this year, said Mike Edwards, the partnership's president and chief executive officer.

"This is a big challenge for us. A lot of people have tried and failed," Mr. Edwards said, referring to former Mayor Tom Murphy's Fifth and Forbes effort in the 1990s, with big public subsidies for the former Lazarus and Lord & Taylor stores, both of which have since closed.

"I think the expectation in the community is that until we have the higher-end, destination retail, there isn't any reason to shop Downtown, so we have to do it."

The partnership, which is supported by Downtown businesses and organizations, released a study yesterday on what types of retail might locate in the business district.

The study, by MJB Consulting Inc. of New York, recommended high-end retail in the Smithfield Street, Fifth Avenue and upper Liberty Avenue corridors; mid-market stores with crossover appeal like Target on Wood Street from Fifth to Forbes Avenue; and stores geared to students and daytime office workers in the area around Point Park University from Wood and the Boulevard of the Allies to the Monongahela River.

Mr. Edwards said it should be relatively easy to accomplish the mid-market and student proposals because those areas already have a captive audience of customers. But the toughest component, high-end retail, would have the biggest payoff in drawing customers from outside the city, he said.

The business district has a high-end anchor in Saks Fifth Avenue at Smithfield and Oliver Avenue, with Joseph A. Bank Clothiers and Brooks Brothers nearby.

But Saks has long bemoaned its limited loading dock space and the need for other similar retailers to create a strong core. Periodically, the store has made rumblings about moving out if those situations don't improve. Store officials were unavailable for comment yesterday.

The study said it is important for the city to address those concerns before Saks pulls the trigger on leaving.

"Saks Fifth Avenue's departure would make the opportunity [to attract similar retailers] even less compelling," the study said. "Indeed, one has to wonder whether the ubiquitous brands already in the Golden Triangle -- Talbots, Ann Taylor, Joseph A. Bank Clothiers and Bailey Banks & Biddle -- would remain if the upscale anchor were to leave."

Mr. Edwards said Saks has indicated it would be willing to make "a significant investment" to upgrade its location in a revitalized business district.

The study said the Downtown area may be in a good situation right now because of Nordstrom's decision to open a store at Ross Park Mall, which caused several similar stores to follow. That puts the Pittsburgh region on the retail industry's radar, which may make it easier to interest other stores in the market, according to the study.

The consultant identified 15 potential candidates for Downtown locations, but the partnership isn't releasing those possibilities, Mr. Edwards said.

Retail development nationwide has been affected lately by slowing consumer spending and numerous chains have announced plans to pull back on new store openings. In that environment, it may be difficult to persuade retailers to take a chance on Downtown development, at least in the short term.

The study also said the partnership should consider buying the former Lord & Taylor building at Fifth and Smithfield and the empty former Lerner's of New York site on Fifth Avenue across from Piatt Place. That would involve the type of major investment the agency usually isn't prepared to make, Mr. Edwards said, but if specific opportunities were available it could make exceptions to assist a project.

The partnership also may want to begin offering financial assistance to make it easier for new retailers to compete in the marketplace, the study said.

In the past, major development has been done through the city's Urban Redevelopment Authority, which has the financial wherewithal to shepherd such projects and offer government incentives. The partnership isn't looking to usurp that role, Mr. Edwards stressed.

"The URA is responsible for the entire city," he said. "If we can work to put something together with a property owner and a retailer and take it to them, we think they would be receptive to that."

In a statement released by his office, Mayor Luke Ravenstahl said he met with Mr. Edwards on Friday and is excited about the possibilities generated Downtown by such projects as Piatt Place and Three PNC Plaza.

"We are experiencing Pittsburgh's third renaissance right now," he said. "Cranes are dotting Pittsburgh's skyline, Downtown living is on the rise, and in historic Market Square, business is booming. We must build upon this momentum, working together to improve Pittsburgh's retail environment."

Mr. Edwards said the next step is for the partnership's board to review the study at a retreat scheduled for next month and put together a plan in next year's budget to meet its goals. That could include hiring additional staff or postponing other projects to concentrate on the retail corridor, he said.

Ed Blazina can be reached at eblazina@post-gazette.com or 412-263-1470.
First published on August 19, 2008 at 12:00 am