Building Up Urban Core Pittsburgh

If you know one thing about Pittsburgh's economy, it should be the excellent job density in the urban core. The bane of the region's existence is the declining population of people living in the city. Aaron Renn (The Urbanophile) does a nice job of weighing the bad news about shrinking Chicago against the still strong central business district (CBD). My own take is that if you fetishize the population numbers, then you'll miss the more important economic story in Chicago.

The could be said of Pittsburgh. A declining number of people is a problem. Just take a look at the City's dire pension situation. The ballooning legacy costs hurt the region. Yet the economic picture continues to get brighter:

Apartments have been one of the highlights of the city's favorable standing with national developers and investors.

"I get calls from developers and investors in areas outside the region interested in either building or buying apartments here," said Cynthia Kamin, CBRE senior vice president.

Occupancy has been in the 96 percent range, though she expects it may drop to 95.2 percent this year. Those numbers are welcome news to apartment owners, who don't provide the concessions in rent or other items as they had in the past, she said.

Rentals average between $886 and $894 per month, and Kamin believes it will increase to $899 per month this year.

Pittsburgh survived the national recession in better shape than most metropolitan areas, said Arthur F. Jones Jr., a senior economist at CBRE Econometric Advisors.

"The region's transition from an industrial economy to one of health care and office occupancy enabled the region to have a good year in 2010 with the promise of continued growth in 2011," he said.

In the city, both office space and apartments are doing well. I doubt it will ever be well enough to address public pensions. But I don't think saying that Pittsburgh is thriving is stretching the truth. The urban core is better off than most and that's in spite of the debt.

In this time of fiscal restraint, the playing field is much more level. For many cities, the problem is relatively new and acute. For Pittsburgh, it is the same crisis that has been around years (if not decades). Perhaps the region is running out of road to kick the can. The end is nigh. My guess is that city government played the shell game long enough for things to turn around. After a half-century of dramatic decline, the urban core is growing.