SomeraRoad received new financial support as it continues renovation activities at SouthSide Works, a mixed-use redevelopment project in Pittsburgh.
With help JLL Capital Marketsreal estate investment firm secured a $74 million loan for a planned site of approximately 470,000 square feet.
SomeraRoad’s vision for SouthSide Works was solid enough to capture the attention of the lending community in today’s uncertain financial environment. Because, as noted by v PwC and City Land Institute‘s New trends in real estate 2022 The pandemic has “accelerated the shift from malls and high-street retail to mixed-use centres,” the report said.
Nick Unkovich and Jeremy Bernstein of JLL Capital Markets represented SomeraRoad in its pursuit of the new financing, which comes in the form of a six-year floating rate loan through Dollar Bank.
Sponsorship also likely played a role in obtaining funding. In February 2022, SomeraRoad’s reputation helped the company get a $525 million loan for the refinancing of an industrial portfolio of 50 real estate objects.
Funding moving forward
Located in Pittsburgh’s South Side neighborhood, SouthSide Works occupies a riverfront site that was once home to the former J&L Steel Works. The development made a splash in the city when it debuted in 2004, bringing a never-before-seen mix of office and retail to Pittsburgh, roughly 245,000 and 225,000 square feet each. However, the project, plagued by poor retail, did not take off as planned, and SomeraRoad officially became the owner and operator of the mixed-use property in 2020 after acquiring outstanding loans on the asset in 2018.
SomeraRoad immediately announced plans to invest approximately $130 million in improvements to revitalize SouthSide Works and transform it into a true place to work and play. And with pandemic-induced delays now in the rearview mirror, the company’s turnaround plan is back on track.
With funds in hand, SomeraRoad is ready to make more changes that will lead to the new incarnation of SouthSide Works. The company expects to build on the success of the five buildings by attracting the next generation of tenants.
Dollar Bank’s funding for the next phase of the SouthSide Works renovation comes about a year after the renovation of one of the property’s five buildings, the former SouthSide Works movie theater, was completed. With an architectural firm OK To initiate the design, SomeraRoad successfully completed the adaptive reuse of a movie theater at The Box Office, a 77,000 square foot state-of-the-art office building with ground level retail.
The four remaining structures at SouthSide Works are 2800 Block, 2700 E. Carson, 2600 B2 Block and 2600 E. Carson. SomeraRoad’s changes to the property have already caught the eye of the tenant group, spurring a flurry of leasing activity, including the signing of new leases for 80,000 square feet and expansions and extensions totaling 100,000 square feet. Amazon, General Dynamics, Duquesne Energy and American Eagle headquarters are among the names on the tenant list.
While Pittsburgh’s office sector hasn’t recovered to its pre-pandemic health, it’s experiencing positive signs. “Tenants appear to be much more active in the market than in 2021, leading to more property tours and rental offers being delivered,” the third quarter report said Kollers. “There is noticeably more commuter traffic, especially midweek, and office building parking lots are filling up with greater regularity.”