For the past several years, developer Todd Palcic has made his living developing condos and apartment buildings in Downtown's cultural district. Now he's taking his talents across town.
Last week, Mr. Palcic completed the purchase of the former Graphic Arts building at 422 First Ave., with plans to convert the eight-story, red-brick structure into apartments.
"I think there's a need for apartments on that side of town," he said Thursday.
Mr. Palcic paid $800,000 for the building and another $350,000 for an adjacent lot, which will provide parking for those who eventually will be living in the building. CBRE was the broker in the sale.
The First Avenue conversion will be Mr. Palcic's fourth residential project Downtown. He already has turned two buildings on Penn Avenue into condominium units and is converting a third into apartments.
He said he sees a market for the First Avenue apartments in the many lawyers, city and county government employees, college professors and administrators, and business people who work in the area.
Grant Street is a couple of blocks from the site, as is Point Park University. The Art Institute of Pittsburgh sits across the street from the building, which dates to the early 1900s.
Mr. Palcic is planning 33 to 37 apartments in the 35,000-square-foot structure, most of them one-bedroom. He expects lease rates to range from roughly $1.50 to $1.75 a square foot, which translates into a monthly rental of $1,200 to $1,400 for an 800-square-foot unit.
The developer expects to get started on the project next year and have the first units completed two years from now.
After converting the first two buildings he bought into condos, Mr. Palcic has turned his attention to apartments. His latest Penn Avenue project -- Lando Lofts -- features 27 luxury apartments.
He said one reason he switched gears was a result of readily available financing at low interest rates. Another was the market.
"I think condos in that stretch of town have already been done and not very successfully," he said.
At the Graphic Arts building, Mr. Palcic is planning to use the second through eighth floors for apartments. He wants to do something "interesting" with the first floor, perhaps in conjunction with the Art Institute or Point Park, although he's not exactly sure what. He doesn't think it will be retail.
"I don't think it's a great retail street. It's a very quiet street, but I do plan to brighten up that street," he said.
Mark Belko: firstname.lastname@example.org or 412-263-1262.