The city finally has hit the bull’s-eye: Target is officially on its way to East Liberty.
Some seven years in the making, the city and developer Mosites Co. have closed on the financing for Target’s proposed East Liberty store, virtually guaranteeing its construction.
The retailer is expected to break ground on the 143,000-square-foot store — one of only a few Targets in the country with two levels — next month.
Construction will take about a year, with the opening scheduled for July 2011. A formal announcement is expected today.
Target will join Home Depot and Whole Foods Market as anchors in a bustling East Liberty commercial corridor that not too long ago was a poster child for inner city blight. Together, they “will change the shopping patterns of many city residents,” said Steven Mosites Jr., Mosites Co. president.
Rob Stephany, city Urban Redevelopment Authority executive director, sees the development as part of the “re-regionalizing” of East Liberty, once one of the largest commercial centers in the state.
“Home Depot, Whole Foods, the restaurants, they are already regional attractors and I think Target will amplify that posture even more,” he said.
Key components of the financing for the $46.8 million project include a $20 million loan from M&T Bank and $12.6 million equity investment by PNC facilitated by new markets tax credits.
Mark Minnerly, Mosites’ director of real estate development and a partner in the project, described the PNC investment as a “gap filler” that enabled the store to proceed.
The URA supplied $14.1 million for site development, including a $10 million U.S. Department of Housing and Urban Development loan and a $2 million HUD grant.
Under the arrangement with Target, Mosites was responsible for securing the financing for the store. Target will be liable for the repayments through a 29-year lease.
The fact the developer was able to secure financing for a retail store in a challenging credit environment is a tribute both to Target and East Liberty, Mr. Mosites said. “All in all, I think [lenders] felt really good about Target’s credit and the location,” he said.
Completion of the financing marks a milestone in a journey that began 10 years ago when a master plan designated the five-acre site bordering Penn Avenue, Penn Circle and Broad Street for a department store.
Target became the “focus” of those efforts about seven years ago, Mr. Mosites said. He described the courting as “herculean” given the recession and the decision by Target to re-evaluate all new store openings.
“Getting Target to invest in East Liberty was an intense strategic effort that could not have happened without so many valuable partners who believe in the economic transformation of our city and of East Liberty,” Mayor Luke Ravenstahl said in a statement.
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