When drivers emerge from the Fort Pitt Tunnel, they’re greeted by a majestic view of Pittsburgh’s dazzling rivers, the iconic Point State Park fountain and the city’s soaring skyline.
And when Lucas Piatt glances left as he drives along the Fort Pitt Bridge, he can already envision the massive Ferris wheel that he hopes will one day tower over the confluence across from Downtown.
Piatt is a dreamer as much as a developer. His plan to construct an eye-catching Ferris wheel along the Ohio River is only a small part of what is likely to become Pittsburgh’s most expensive development project of the modern era — a $740 million gamble to transform a brownfield into a bustling entertainment district.
If successful, Piatt will be conjuring something from nothing, willing into existence a community from a long-neglected swath of land. The potential benefits are enormous: a much-needed economic boost for the city, new jobs, more visitors and higher property tax revenues.
Dubbed Esplanade, the development in the city’s barren Chateau neighborhood aspires to be a first-day attraction for the city, complete with restaurants, retailers and riverside recreation.
Piatt hopes to create a grab bag of possibilities. Green space, a marina, a winter garden. An incubator for local entrepreneurs, entertainment areas and places for pop-up events. Plans call for public restrooms, a grocery store, and parking for cars and bicycles.
Also on the drawing board: a 126-unit condo complex, a 13-story hotel and a mixed-income apartment tower. The pièce de résistance — the nearly 200-foot-tall Ferris wheel — will provide a bird’s-eye view of the cityscape and rivers.
Piatt, 48, CEO of Cecil-based Piatt Companies, said the goal is to break ground this spring.
“I think there’s incredible opportunity for this project to be a place to show that Pittsburgh can shine but also a place to create wonderful jobs, economic impact, a place for people to live,” Piatt told TribLive.
Whether it’s too good to be true remains to be seen.
Over the years, Piatt Companies has left its mark on redeveloping Downtown Pittsburgh, becoming a key player in converting properties such as the former State Office Building and the Lazarus-Macy’s building on Fifth Avenue.
But the company has largely tackled comparatively simple projects, building hotels, restaurants, health care facilities and Highmark Stadium, the home of the Riverhounds professional soccer team along the Monongahela River. The sole exception: Southpointe, a 589-acre suburban office park in Washington County whose development put Piatt on the map.
Esplanade promises to be a significant step up from the company’s typical portfolio.
Right now, Piatt and his development team are humming along. Pittsburgh’s planning commission and Urban Redevelopment Authority are on board with Esplanade. City Council members are excited. No residents are worried about being evicted since no one lives on the site.
But even with Pittsburgh’s power brokers in his corner, Piatt has critical work to do before the development becomes a reality. The company remains busy acquiring land, working to move existing businesses elsewhere and locking down financing and investors.
Piatt also still needs the city, its school district and Allegheny County to sign off on a critical tax diversion that will make or break the project. And he has yet to convince a small group of North Side residents that Esplanade will benefit them.
Gentrification fears
Esplanade will be built on what is now mostly unused land largely cut off from the neighboring Manchester community by Route 65.
But not everyone in Manchester is optimistic about their new neighbor. Roberta Bowra, 64, worries the development will continue to drive up housing costs and fears that could force more residents out of the historically Black neighborhood.
“Our largest concern is us being gentrified out of where we’ve lived all our lives,” Bowra told TribLive recently.
Bowra is vice president of Manchester Neighbors, a recently formed community group that opposes Esplanade, based mainly on concerns that it could make it harder for low-income Manchester residents to stay in their neighborhood.
“That’s our main fear — that we’re going to lose our neighborhood like East Liberty did,” she said, referring to the displacement that occurred in the community in Pittsburgh’s East End amid new, pricey developments.
Piatt said he has a solution. Esplanade will include an affordable housing component. Piatt has vowed to earmark 20% of housing units for low-income residents.
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But that might not be enough to sway Bowra, who said she still feels the glitzy development isn’t truly intended for low-income residents and minorities.
She said she doubts Esplanade will bring benefits for people like her and others in Manchester who can’t afford to spend money on Ferris wheel rides and event tickets.
“It’s not for Manchester,” she said.
Piatt told TribLive the development is for everyone. He noted the plans that call for sprawling outdoor spaces where people can enjoy nature, walk or bike along trails and take in views of the river without spending any money.
The affordable housing component, he said, has been of paramount importance.
‘Blank slate’
Though many may see the property as an empty brownfield, Piatt and James Holcomb view the land as an opportunity to create an entertainment district that expands on — and complements — Downtown and the North Shore.
“It’s more of a blank slate,” said Holcomb, Piatt’s director of development.
The goal isn’t to compete with existing communities or steal the show from a massive revitalization project underway Downtown, Piatt said. Instead, he sees Esplanade as yet another attraction to draw people into the area as tourists or to encourage businesses to set up shop in the city.
“I do believe it’s going to be a destination,” Piatt said.
So does Jerad Bachar, president and CEO of tourism agency Visit Pittsburgh.
“In the case of Pittsburgh, we’re fortunate to have a plethora of experiences, but we don’t have one unique thing that everyone thinks of when they think Pittsburgh,” Bachar said. “Could Esplanade be that? Absolutely.”
Embracing the river
The project also aims to help link Chateau to nearby Manchester and the North Shore. Proposed changes include converting Beaver Avenue to a two-way street.
Part of the appeal of the location, Piatt said, is the opportunity to reconnect people in those communities with the natural beauty and recreational opportunities of the river. Chateau, linked to the rest of the city by the West End Bridge, sits snugly between Route 65, the Ohio River, Acrisure Stadium and the southern tip of Brunot Island.
“This project, I think, will be a beacon for the recreation that this region offers, hiking, biking (on the) riverfront,” Piatt said.
Esplanade will improve existing riverside trails and create a new marina.
“Unfortunately, most of the projects in Pittsburgh have turned their back on the river,” Piatt said.
Piatt points to Pittsburgh’s legacy of underutilizing its rivers, using prime riverfront lands for industrial purposes or to house the county jail. Esplanade will allow people to live, work and play along the city’s key natural feature.
Pain and gain
The project received $25 million through the Redevelopment Assistance Capital Program, a matching economic development grant from the state.
That will fund utility and road infrastructure and prepare lands for construction, said Molly Onufer, a spokesperson for the developer.
Piatt is in the process of raising equity and securing bank financing.
Piatt’s commercial leasing team is helping businesses that still occupy two buildings on the site to find new homes, though they may have an opportunity to return to the site after Esplanade is built, Onufer said.
A special tax diversion is proposed to help fund public infrastructure in the development and invest in the surrounding community.
The Transit Revitalization Investment District tax incentive — which is awaiting approval from the city, county and Pittsburgh Public Schools — will divert 75% of additional tax revenue that comes with redevelopment back to the project, rather than allowing it to go straight to the taxing bodies.
While the tax district will last for 40 years, individual parcels at the site are eligible for only a 20-year tax break.
Part of the money will be used to “stave off displacement” by investing in affordable housing throughout Manchester, said City Council President R. Daniel Lavelle, whose district includes the Esplanade site.
It also will support efforts to improve connections between Manchester and Chateau, he said.
The tax diversion is critical. Piatt said Esplanade could not happen without it.
Right now, the site generates nearly $84,000 in property taxes annually, according to the city’s Urban Redevelopment Authority. A portion of the property has been under the authority’s ownership — and off the tax rolls — for more than two decades.
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Tax diversions such as the one Piatt is seeking are commonplace for large developments, said Councilman Anthony Coghill, D-Beechview.
“It’s short-term pain for long-term gain,” Coghill said.
Once Esplanade is completed in six to 10 years, it is expected to generate about $8 million in annual property tax revenue.
Lavelle said the extra money will be a major boost to the city — even if a chunk of it is diverted at first.
Bill Generett Jr., senior vice president of civic engagement at Duquesne University, said Piatt has taken his time with the development, ensuring it meets community expectations and shoring up support before plowing ahead.
“This is a developer that’s done things right,” he said. “This is a project that’s on sound footing.”
The Ferris wheel
Formerly known as Millcraft, Piatt Companies is behind Washington County’s Southpointe, a business park in Cecil that was built in various stages spanning more than two decades. The developer’s biggest project to date, it has attracted billions of dollars of investment.
The family business was launched in 1957 by Piatt’s father, the late Jack Piatt. It has since developed nearly $450 million worth of mixed-use projects in Downtown Pittsburgh.
The Esplanade project has been in the works for about eight years.
The development team traveled to cities like Seattle and Vancouver to seek inspiration. They brought ideas to city officials and community leaders and pivoted in response to zoning changes, input from local leaders and residents, and changes to the financial markets spurred by the covid-19 pandemic.
There have been at least eight iterations of the project, Piatt said. Some had 30-story buildings, which have been scaled back. Others had a “lagoon,” a 2-acre water feature for year-round use. That element has been replaced with a recreation and activity space.
But the elements Piatt believed to be most important — affordable housing, sustainability, creating a space that will welcome everyone, increasing economic opportunities and connecting communities to the river — have remained consistent, despite the tweaks over the years.
Even as Piatt looks to Esplanade to be a pivotal development for Pittsburgh’s future, he also is planning to include a nod to Pittsburgh’s past.
As he looked at major developments in other cities, Piatt saw Ferris wheels serving as focal points.
Its inventor, George Ferris, lived on Pittsburgh’s North Side. So Piatt decided Pittsburgh deserved a wheel of its own.
If Ferris didn’t have such strong roots in Pittsburgh, Piatt said, they might’ve considered scrapping the attraction as they revised plans over the years.
But Piatt said the wheel — the element of the development that seems to have most excited Pittsburghers — will be an opportunity to call attention to a unique piece of the city’s past.
Worth the wait
During the pandemic — which skyrocketed construction costs, drove down demand for office space and hurt Piatt’s finances — the development team had a serious conversation about whether the project ought to move ahead. It would cost more as inflation rose.
In those challenging moments, Piatt said, he closed his eyes and visualized himself standing within the finished project.
He pictured kids splashing in the spray park, visitors launching kayaks in the river, cyclists riding along the trails. He envisioned himself among families thronging to the Ferris wheel and chatting over dinner afterward.
That motivated him to keep pushing ahead with the project.
“At the end of the day, it’s worth fighting for,” Piatt said. “It takes a long time for good things to happen.”