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Wednesday, April 16, 2003

By Jonathan Barnes

The resale of the Peoples Building in McKeesport for more than triple its original $600,000 price tag may mean the partly vacant city landmark will get a new lease on life.

McKeesport Redevelopment Authority recently sold the Peoples Building to Reno, Nev.-based Strong Partners for $600,000. Strong Partners then sold the building for $2 million to Geneva Equities of Santa Monica, Calif., of which Strong is a subsidiary. But though some question how the building could be resold for triple what the city received for it, McKeesport officials believe the deal is good for the city.

McKeesport was given the building by Integra Bank in 1996, partly because no one was paying the $475,000 asking price. By this year, the city was getting a positive cash flow from office leases, said Charles Starrett, McKeesport Redevelopment Authority director. He added that the building first was put up for sale in 1998, and said now appears to be the time of its renewal. "It's our hope that they rent out the entire building," he said.

Colliers Penn is managing the leasing of the building on behalf of Geneva Equities and has informed city officials that the company will be doing renovations to the building. Starrett asked the company for a summary of its plans in order to process funding requests. The building is in a Keystone Enterprise Zone.

"The development of the building can be a linchpin to the redevelopment of the downtown," said Tom Sullivan, a Colliers Penn real estate broker who arranged the sale of the Peoples Building. He added that it sometimes takes an outside group such as Geneva Equities to spur development in an area such as McKeesport.

"We're putting together some short-term and long-term strategies for renovating the entire building," he said.

Among the improvements planned are new heating and air conditioning systems, new elevators and refurbished common areas. About 60 percent of the building's office space currently is occupied.

Colliers Penn is looking for a retail business as a tenant for the Peoples Building's Fifth Avenue storefront, which used to house a D&K Store. The old-style charm of the building and its central location will make the leasing easier, Sullivan said. "It's a classic building that is essential to redevelopment of the city," he said.

Jonathan Barnes is a freelance writer.