Pittsburgh Gateways seeks ‘modified plan’ on Strip District produce terminal

A nonprofit economic development group involved in the transformation of the former Connelley Trade School in the Hill District may get a crack at redeveloping the Strip District produce terminal.

The city’s Urban Redevelopment Authority appears to be ready to turn to Pittsburgh Gateways Corp. as a potential co-developer with Chicago-based McCaffery Interests in remaking the landmark, a longtime hub for produce wholesalers that now is nearly empty.

Robert Meeder, CEO and president of Pittsburgh Gateways, said Tuesday he is expecting the URA board at its meeting Thursday to give his group four months to work with McCaffery to come up with a “modified plan” to redevelop the 1,533-foot-long Smallman Street warehouse.

The organization’s role, he said, will be to make sure the terminal is developed in concert with its history and in keeping with the interests of the community and its funders.

One avenue Pittsburgh Gateways hopes to explore is possible tie-ins to existing Strip merchants, particularly those on Penn Avenue. That could include additional retail opportunities at the terminal or perhaps even educational programming. Local retailers would be given preference over national chains or franchises, he said.

In keeping with the building’s wholesale produce legacy, the nonprofit also plans to explore possible farm-to-table options. That, for example, could include restaurants with connections to local community gardens, Mr. Meeder said.

“The intention is to give [farm to table] a full review as we do a development plan,” he said.

McCaffery has proposed converting the terminal into 118 residential units, including 14 live-work lofts; 20,000 square feet of office space; and 25,000 square feet of retail at a cost of $30 million.

Mr. Meeder said there has been a lot of discussion regarding the amount of residential in the building. “There’s a possibility there could be none,” he said.

He added that Pittsburgh Gateways has had many meetings with McCaffery and that the goal is “to try to arrive at the best plan” for the terminal’s future.

The involvement of Pittsburgh Gateways would mark the URA’s second attempt in the last year to redevelop the property.

Last September, the URA board selected McCaffery and Pittsburgh-based Rubino Partners as co-developers as part of a plan to turn the aging terminal into housing and a marketplace. The latter included a farmers and food truck row on the docks and a mix of merchants inside, anchored by those selling closeout merchandise.

Jim Ferlo, a URA board member and former state senator, said he is expecting the board to rescind the agreements with Rubino and McCaffery to clear the decks for the partnership between McCaffery and Pittsburgh Gateways.

Mr. Ferlo said he’s all for any arrangement that provides for “positive movement going forward” and gets the URA-owned property back on the tax rolls.

“We’ve got to get out of the business of owning this property. It’s been an albatross around our necks for more than a decade, costing the URA a lot of money, money that could be going into other projects,” he said.

A McCaffery spokesman referred questions to Kevin Acklin, the URA board chairman and chief of staff to Mayor Bill Peduto.

In an email, Mr. Acklin said he would withhold comment until Thursday, “other than to say that we have made substantial progress toward the redevelopment of the produce terminal building in a manner that accomplishes the mayor’s dual goals of preserving public space and harnessing transformational growth potential in the Strip District.”

Mike Rubino, head of Rubino Partners, was unavailable for comment.

Mr. Meeder said Pittsburgh Gateways started to look at the produce terminal at the request of some of the local foundations — a main one being the Heinz Endowments — based on the work it had done at the Connelley Trade School.

Pittsburgh Gateways bought the 233,822-square-foot Connelley school from the Pittsburgh Public Schools in 2011 and has spearheaded its conversion into the Energy Innovation Center, a 6.5-acre complex designed to promote energy-sector research and innovation and create direct links to job creation, entrepreneurship and urban economic revitalization.

It also brought together more than two dozen different investors and partners as part of the $37 million project. The city has been struggling to find a way to fund the terminal redevelopment.