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4C — September 25 - October 15, 2015 — Fall Preview — M id A tlantic
Real Estate Journal
P ittsburgh C ommercial M arket Cushman & Wakefield|Grant Street Associates Pittsburgh commercial market outlook
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was created to help accelerate the resurgence of manufacturing in the U.S. For six of the past eight years, advanced manufac- turing has been the Pittsburgh region’s most active sector with regard to business investment deals, representing $450.2 mil- lion in capital investment in 2014. The Brookings Institution ranked Pittsburgh 45th out of the 100 top metros for employ- ment within advanced indus- tries such as R&D and science, technology, engineering and math (stem). With more than 103,000 professionals currently
a robotics research lab that will focus on constructing self- driven cars. TheUber Advanced Technologies Center will be developed near CMU’s national robotics engineering center in Lawrenceville. The center also will occupy space within two neighboring buildings. The University of Pittsburgh has signed 15-year leases for three energy-related labs for its Swan- son School of Engineering and incubator space for up to six innovation projects. The univer- sity plans to take occupancy of its new space at the Energy In- novation Center in Pittsburgh’s Hill District neighborhood in Q3 2015. According to the Federal Re- serve’s Beige Book survey, com- mercial real estate offers the most optimistic future in the Pittsburgh region. Demand for business credit was strongest for commercial real estate and commercial and industrial loans, reflecting improved prospects for new and expanding offices in themetro. Construction activ- ity within the commercial and institutional sectors appears to be supporting this theory as the market experienced a 24.3% jump in the first half of 2015, reaching $1.38 billion. Among the largest projects to kick off this year is CMU’s 425,000 s/f mixed used devel- opment located on a two-acre parcel in Oakland, Pittsburgh’s tightest office submarket.Witha current vacancy rate of just 3.1% and class A asking rental rates exceeding $30 psf, Oakland is the center of Pittsburgh’s “eds and meds” activity and the loca- tion of several of the region’s lat- est high-endmulti-family devel- opments. CMU’s project, which caps a campus building boom expected to total more than 750,000 s/f, also will feature a hotel with conference center, shops, restaurants and flexible meeting spaces for students, faculty and staff collaboration. Outlook Home to eight of 2014’s For- tune 500 companies, Pittsburgh has emerged as a diversified global business center. Pitts- burgh should see a significant in- crease in leasing activity through the end of 2015, though rental rates will remain virtually un- changed and vacancywill fluctu- ate as new product is delivered to the market. Investor activity, particularly in the CBD, is ex- pected to continue to increase. n New Construction Activity Accelerates
dvanced manufactur- ing poised for growth in 2015
Named one of twelve new “manufactur- ing commu- nities” that are part of the U.S. De- partment of Commerce’s Investing in Manufactur-
Jack O’Donoghue Principal
working in these fields in the region, leasing and user sales within the high-tech and ad- vanced manufacturing sectors has gradually increased for the past five years. User sales activ-
ity in the Pittsburgh industrial market topped 1.2 million s/f in the first half of 2015. Uber technologies, Inc. has partnered with Carnegie Mel- lon University (CMU) to build
ing Community Partnership (IMCP), Pittsburgh is poised to lead the country in specialty metals manufacturing. IMCP
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