Pittsburgh's Tallest Office Tower Sold to Investor Group for $250 Million
A group including New York-based real estate investor Mark Karasick bought Pittsburgh’s tallest building, the 64-story U.S. Steel Tower, for $250 million.
The investors acquired the entity that owned the building from Area Property Partners LP, Karasick said today in a telephone interview. Tenants in the 2.9 million-square-foot (269,000-square-meter) tower at 600 Grant St. include UPMC, the nonprofit health care operation affiliated with the University of Pittsburgh.
The property is 94 percent occupied, Karasick said. Pittsburgh began shifting in the early 1980s from its dwindling steel industry to an economy based on education, medicine and technology. Pittsburgh’s office vacancy rate was 11.2 percent at the end of 2010, lower than the U.S. average of 16.4 percent, according to CB Richard Ellis, a Los Angeles-based broker.
“We like Pittsburgh a lot,” Karasick said. “They’ve re- created themselves.”
A loan backed by the property was sent to a special servicer in September after the borrower couldn’t pay the debt, according to Bloomberg data. Area Property has paid the debt associated with the property, Karasick said.
The investor group has borrowed $220 million from UBS AG to make the purchase, Karasick said.
A message left for Julie Solomon, a spokeswoman for New York-based Area Property, was not immediately returned.
The sale was reported Saturday by the Pittsburgh Post- Gazette.
To contact the reporter on this story: Brian Louis in Chicago at blouis1@bloomberg.net
To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net
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