A Sweet Recipe for Success

A Sweet Recipe For Success This summer, Bakery Square is opening its doors, bringing new life to the landmark old Nabisco factory.

BY CALLY JAMIS VENNARE

The now-renovated baking facility, with its three signature towers, was constructed in 1918.

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A Company on the Rise

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iven the opportunity to develop more than six acres of historic real estate—property surrounded by upscale neighborhoods, major universities, a world-class medical center, and acclaimed restaurants and retailers—what would you create?

Gregg Perelman, the visionary CEO of Shadyside’s Walnut Capital Management, chose to make “a significant East End impact” in the community he calls home. The result is Bakery Square, a vibrant mixed-use development that is opening on the site of the once-vacant Nabisco plant at the corner of Fifth Avenue and East Liberty Boulevard.

Perelman recalls an early conversation about the venture with his business partners, Todd Reidbord and Anthony Dolan. “We all said, ‘Let’s put an office here, create a Walnut Street environment there; add storefronts, a business center, then retail,’” he recounts. “We wanted to create an environment where people walk around.”

After three years of tireless work and a total project cost of $130 million, that vision is now becoming a reality. Visitors and tenants alike see Bakery Square—dubbed BkSq for short—as the perfect urban backdrop for both work and play, where vintage architecture is reinterpreted with a modern, urban aesthetic.

Elegant brick facades combine with meandering sidewalks and café-style outdoor seating to create a lively, inviting atmosphere.

Eco-friendly interiors distinguished by open floor plans, expansive windows, and cool industrial balconies provide inspiration. And right outside the office door, opportunities

An artist’s rendering of Bakery Square as it will look when fully occupied and open for business.

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Walnut Capital

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eal estate development is truly a passion for Gregg Perelman, the Squirrel Hill resident at the helm of Walnut Capital Management.

Perelman gained his entrepreneurial verve as President and CEO of the family-owned neighborhood drug store, Stadtlander Pharmacy. In less then a decade under his stewardship, the business grew from $1 million in annual sales to a nationwide specialty pharmacy business servicing transplant and AIDS patients. Yearly revenues exceeded $250 million. After selling the company in 1996, Perelman gathered together a talented team of Pittsburgh entrepreneurs—including Todd Reidbord and Anthony Dolan—to form Walnut Capital.

Its headquarters are aptly located on Walnut Street in Shadyside.

Since its inception in 1997, Walnut Capital has become one of Pittsburgh’s largest and fastest-growing real estate management, development, and brokerage companies. The firm has amassed a retail and multi-family residential property portfolio valued in excess of $150 million.

In addition to Bakery Square, the company’s achievements in the city include 1,500 units of East End housing and Shadyside’s Banana Republic flagship location, as well as the Strip District’s Cigar Factory Lofts and the 1400 Smallman Street complex. Other projects include the renovation of landmark Squirrel Hill residential properties such as Beacon Commons, Walnut on Forbes, and Walnut on Wightman; the development of the Walnut Place retail complex on Browns Hill Road; and the construction of The Metropolitan Shadyside—the six-story luxury condominium building on Neville Street.

—by Cally Jamis Vennare 81

A Sweet Recipe For Success Evidence that the building was once home to the National Biscuit Company can be seen above the original entryways.

Below: Men handled responsibilities involving large equipment, like these kettles and mixing machines where chocolate, marshmallow, and icing were prepared.

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Right: Women and girls made up half of the workforce at the baking facility. This 1919 photo captures several of them candling and cracking eggs.

await for a pre-dawn workout, mid-morning coffee break, afternoon shopping excursion, or casual evening stroll.

By the numbers, Bakery Square is nothing short of impressive. The development boasts almost 400,000 square feet of office and retail space, a stylish 110-room hotel, and more than 1,000 parking spaces. A gradual succession of openings—beginning with the SpringHill Suites by Marriott hotel on May 4 and including Anthropologie, Coffee Tree Roasters, and Urban Active fitness club—will take place throughout the summer, much to the excitement of local residents and community groups seeking to revitalize East Liberty.

creamery butter and the highest grade of lard were included in recipes, and all eggs were “first candled, and then cracked and examined by girls” to ensure that baked goods met the highest of standards.

The delicious outcome: 50,000 loaves of bread a day, to say nothing of the cookies, crackers, and “countless other specimens of the pastry maker’s art,” such as the popular Uneeda Biscuit.

After 80 years of stability under Nabisco, the Regional Industrial Development Corporation (RIDC) bought the site in 1999 and leased it to Atlanta Baking Company (ABC). ABC eventually sold the operation to

“The developer has successfully combined preservation, adaptive reuse, and urban infill development to transform an empty, historic hulk into a dynamic asset for our community,” praises Richard Pearson, an urban planner and developer who lives in Shadyside across the street from BkSq. Like so many of his neighbors, Pearson had long hoped that something positive would be done with the former Nabisco factory.

The National Biscuit Company built the plant in 1918 as part of a nationwide expansion in what is actually the neighborhood of Larimer. Until its closure eight decades later, it remained a sentimental favorite among East Enders tempted daily by the mouth-watering aromas wafting from the building.

In its early days, the factory employed 1,500 people—half of whom were women and girls—and transacted $1 million worth of business each month, according to The Story of Pittsburgh. The 1919 book also references Nabisco’s meticulous adherence to quality.

Every week, approximately 2,800 barrels of flour were “bolted and then sieved three times” before use. Only the freshest and purest

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The Nabisco plant as it appeared in the 1960s. The original seven-story building, at the top left, was later followed by a four-story addition, and both of those structures are part of the Bakery Square complex. The long three-story segment, built in 1948, was demolished.

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A Sweet Recipe For Success the Bake-Line Group, which declared bankruptcy in January 2004, leaving the factory empty.

Since that time, development activity in and around the abandoned plant has been booming. Following in the earlier pioneering footsteps of Home Depot and Whole Foods Market, other prominent national tenants like Trader Joe’s, Staples, FedEx Office, and Borders moved to the neighborhood and prospered, attracting a diverse array of local businesses that includes restaurants, salons, fitness studios, a bakery, bike shop, and others. Giant retailer Target is also planning to open a store next year where the nearby Penn Towers public housing buildings once stood.

“I never could have envisioned it,” says Molly Blasier, speaking of East Liberty’s phenomenal growth. As Principal of Blasier Urban LLC, the Point Breeze resident is a partner in the neighboring EastSide complex—home to Whole Foods Market—and understands firsthand the challenges involved in a development of this scope. “I applaud Walnut Capital for taking the risk with Bakery Square,” she says.

Risk, indeed. When Walnut Capital opted to acquire the Nabisco site from RIDC in

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G With a May 4 opening, the SpringHill Suites Pittsburgh Bakery Square is the first tenant in the complex to open for business.

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I 2007, the 6.5-acre property had been declared “blighted” by the City of Pittsburgh. “It had asbestos and abatement issues,” notes Ernie Hogan, director of commercial development at East Liberty Development Inc. (ELDI), a nonprofit organization working to revitalize the neighborhood it considers to be “the downtown” of the East End. Bakery Square’s location marks a strategic win for ELDI, which has developed a community plan for the area stretching along Penn Avenue to Penn Circle, according to Hogan.

“Walnut Capital came to the table and dreamt up a mixed-use development,” he says. “They helped us reinforce the corridor from Penn to Centre avenues.”

Nathan Wildfire, ELDI’s sustainable policy coordinator, also praises Walnut Capital’s strong collaborative efforts with his organization and the Shadyside Action Coalition.

“They did a good job of engaging [with us] in the…planning process,” Wildfire says. Those alliances, Wildfire says, guided the BkSq team in such areas as green building and roadway improvements, including new traffic signals and dedicated turning lanes in the blocks approaching the complex, widened sidewalks and roads, pedestrian walkways and bike lanes, and decorative lamp posts that now line Penn Avenue from Fifth Avenue to Bakery Square.

“It’s like a boulevard,” says Perelman of the new light fixtures, “like in Paris.”

In addition, support from elected officials and government organizations helped Bakery Square weather the global recession that easily SUMMER 2010

could have derailed the project, Perelman says.

The Urban Redevelopment Authority, the state Department of Environmental Protection, and The ERECT Funds, among others, provided financial backing and professional endorsements. Tax increment financing helped fund BkSq’s parking garage and infrastructure improvements. Rehabilitation grants financed removal of asbestos, PCBs, and leadbased paint, as well as road upgrades.

And slowly but surely, the BkSq buzz began to spread. Retail and office occupancy stabilized and then grew under the watchful eye of leasing firm CB Richard Ellis. The hotel broke ground. High-end women’s clothing and home décor chain Anthropologie secured its spot as the anchor retail tenant. Local business Coffee Tree Roasters joined the BkSq family. And two major players committed to a total of 80,000 square-feet of office and retail space—the University of Pittsburgh’s Department of Rehabilitation Science and Technology (in partnership with the Veterans Administration) and state-of-the-art wellness and fitness center Urban Active.

“It couldn’t be coming together better than this,” says Francisco Sellés, general manager of Marriott’s SpringHill Suites at Bakery Square.

“Once it’s all together it’s going to be so cohesive; people are just going to flock to it,” he predicts, describing the new complex as “a modern, vibrant area.”

More good news came last December when Google announced it would double its existing footprint in the city by moving its 85

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A Sweet Recipe For Success

Urban Active Fitness is scheduled to open its Bakery Square facility, which will look similar to this, on June 15.

offices from Carnegie Mellon University’s campus to occupy two entire floors at Bakery Square.

“We are so excited about the feel, location, and history of Bakery Square—just the right kind of place for this growing bunch of creative software engineers to be building some of the next generation of Google products,” says Andrew Moore, head of Google’s Pittsburgh operations.

Google’s move signaled a tipping point for the development and its loyal partners. It also represented a significant commitment by a global corporation to a sustained and growing presence in Pittsburgh, according to Carnegie Mellon University President Jared Cohon.

“Google’s decision to locate in East Liberty, a neighborhood now undergoing an exciting transition, is itself a great vote of confidence in the city’s future,” he says.

Being close enough to maintain its ties with the university was another key consideration for the technology powerhouse, Moore says. By the time the company moves into its new home in July, a new shuttle service will link BkSq with Carnegie Mellon. It will also make additional stops along the “eds and meds” corridor lined

by University of Pittsburgh, Chatham University, UPMC, and others.

Although Bakery Square was designed with a modern sensibility, Walnut Capital and the project’s design team at Astorino sought to preserve BkSq’s historical integrity. Many vintage architectural elements of the factory— most notably the familiar NBC marker— remain intact and beautifully integrated into the new design. Building facades were skillfully re-pointed and unusable parts repurposed as fill for the site.

Bakery Square is also pursuing LEED green building certification at the former factory and all newly constructed retail buildings.

Storm water management, energy efficient HVAC systems, day lighting, and on-site renewable energy are among the hallmarks of the sustainable design strategy.

As Walnut Capital and New York partners RCG Longview Fund and the Feil Organization perfect the recipe for success at BkSq, the development continues to make local and national headlines. A recent New York Times article cited Bakery Square as a key force in helping to put East Liberty “back on its feet.” Perelman is understandably proud of what his company has accomplished, and he is hopeful for what the project will mean for the future of the neighborhood.

“We feel that Bakery Square opens up the door for more opportunity in this area,” he says. “The benefit is that it’s pulling together others, making a statement for new companies that want to expand, and enabling them to do so.”

“That’s part of Pittsburgh’s appeal—to me and to others,” Perelman continues. “You can be a big fish in a small pond. You can truly __ SA make big things happen.” __ Many thanks to Art Louderback of the Senator John Heinz History Center for his help securing historical photos.

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