State selling its 50-year-old Downtown office building

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HARRISBURG -- For sale: 16-story office building in great Downtown location. Needs some TLC.

The State Office Building, overlooking Point State Park, is going on the market, the state Department of General Services confirmed yesterday.

There is no timeline for the sale and no asking price has been set yet, said Sean Pressmann, spokesman for the department. The building is appraised at $8.2 million.

The building houses offices for the state departments of Labor and Industry, Public Works, Community and Economic Development, Conservation and Natural Resources, Banking and Revenue.

The 827 employees who work there would be transferred to one or more locations the state would lease elsewhere in Pittsburgh, said Chuck Ardo, spokesman for Gov. Ed Rendell. Potential space has not yet been identified, he said.

"It's much too early for that," he said. "Whatever site is selected will be accessible to the public, hopefully even more accessible than the Downtown location. There's no parking there."

State offices have occupied the building since it opened in 1957.

After 50 years, the building is outdated and needs millions of dollars in renovations, Mr. Pressman said.

"Old facilities cost money to maintain," he said. "It would be a burden on the commonwealth taxpayers to do necessary renovation to the facility. It would be a cheaper and better deal for taxpayers to sell that facility."

The move to leased space could save the state an estimated $54 million over 20 years, Mr. Pressmann said.

The planned sale is something Mr. Rendell has been advocating for years, along with the sale of Philadelphia's State Office Building.

The Legislature hasn't yet approved either sale, but bids are already being sought for the Philadelphia building.

Mr. Ardo and Mr. Pressmann said there are no prospective buyers yet for the Pittsburgh building, but people who attended a political fund-raising event for Allegheny County Chief Executive Dan Onorato at the LeMont Restaurant last week said Mr. Rendell provided some insight during his remarks that night.

They said he indicated the building could be converted into apartments, condominiums or private offices, or a combination.

Significantly, if the 16-story building is converted into private ownership, it would lose tax-exempt status and provide property taxes for the city, county and Pittsburgh Public Schools.

The future of the State Office Building came up at the Port Authority board meeting yesterday in conjunction with that agency's office needs.

The authority still has the half-empty former administration building at Beaver and Island avenues in the Manchester neighborhood. The authority, unable to find a renter or buyer for the facility, has been thinking of moving back, although updating and renovating the building has been estimated to cost between $3.7 and $4.7 million.

Port Authority board member James Dodaro, who heard the governor's remarks at the Onorato fund-raiser, suggested the state might be interested in the Port Authority building, but officials in Harrisburg would not confirm that. A body shop and some offices that the authority still maintains at the Manchester location could be moved, possibly to the Harmar Division bus garage, which could be closed in the future because of service reductions.

Meanwhile, authority officials are thinking about remaining in the Heinz 57 Center, Downtown, where they moved seven years ago under terms of a negotiated lease for less space, inasmuch as the administrative-management staff also has been reduced.

"If the State Office Building is sold, they'll be looking for a lot of space to rent, and it doesn't necessarily have to be Downtown," Mr. Dodaro said. "Shouldn't one public entity help another public entity?" he asked, referring to the Department of General Services helping with the Port Authority's predicament.

The Port Authority previously was unsuccessful in trying to interest the state Gaming Control Board in leasing space at Manchester for its Pittsburgh regional office.

Rebecca Droke, Post-Gazette
On the market: the State Office Building
Click photo for larger image.

Joe Grata can be reached at jgrata@post-gazette.com or 412-263-1985. Tracie Mauriello can be reached at tmauriello@post-gazette.com or 717-787-2141.


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