Allegheny County is close to finalizing a long-delayed deal to sell the health department building in Oakland for $4.9 million to a local group with plans to use the site for a proposed hotel and office development.
County officials hope to sign a sales agreement with the team of Massaro Properties, the Langholz Wilson Ellis real estate firm, and architect Tasso Katselas Associates in a couple weeks, economic development director Dennis Davin said.
The county is nearing the completion of a deal more than three years after county council approved the sale in November 2009. Mr. Davin said the deal was held up by the recession and a change in hotel developers.
Gary Wilson, a principal in Langholz Wilson Ellis, said Kratsa Properties no longer is part of the development team. He said the group is now working with another hotel developer but hasn't finalized an agreement.
The team hopes to close on the property at 3333 Forbes Ave. by year's end after a period of due diligence, Mr. Wilson said.
It is planning a 50,000-square-foot office building, a 168-unit hotel and a parking garage at the site, which has frontage on Forbes and Fifth avenues. The hotel would front on Fifth and the office building on Forbes, Mr. Wilson said.
He did not know whether the health department building would be reused as part of the development or demolished.
The group also purchased a property at 3337 Forbes Ave. next to the health department building last December for $385,000.
Mr. Wilson said that land will be used to provide easier access to the hotel.
If all goes according to plan, the development team hopes to start on the project early next year and have the office building completed about a year later. The hotel would be finished in late 2015.
Once the sale is completed, about 40 county employees who now work in the health department building will have to be relocated. One option under study is to move them to the former county morgue Downtown.
The county is in the process of renovating that building, which is more than a century old. At one point, it was considering using the building for law department offices, now located in leased space in the Fort Pitt Commons building on Fort Pitt Boulevard.
"We are looking at several departments that may be able to use that space but no final decision has been made on it yet," said Amie Downs, spokeswoman for county Executive Rich Fitzgerald.
Among the departments under consideration to make the move are health and law, she said.
Mark Belko: email@example.com or 412-263-1262.