Project growth shines in Washington, Greene
Pat McCune, left, president and CEO of Community Bank, and Pat O’Brien, president and CEO of First Federal, are shown after announcing the merger of the two banks into Community Bank.
The former Kyowa building on Route 21 in Franklin Township was sold in 2014.
Rod Piatt, left and Michael Swisher, Horizon Properties principals, opened the Southpointe II Town Center to serve the business park's growing number of employees.
Natural gas, coal and sunlight aren’t the only energy sources in Washington and Greene counties. Check out the workforces.
Unemployment has been plummeting in the region, thanks largely to accelerated Marcellus Shale development and growth in its supply chain. According to the Pennsylvania Department of Labor & Industry, the jobless rate was 3.9 percent in Greene and under 4.7 percent in Washington in October, the latest month for which countywide statistics are available. Both counties have fared better than most of the nation for nearly two years.
“There is a definite correlation between our low unemployment rates in both counties and the continued expansion of the energy industry here,” said Jeff Kotula, president of the 1,100-member Washington County Chamber of Commerce.
Winds of change have dominated the regional business climate in 2014, with mixed-use developments rising up, a venerable department store closing up, two local banks amicably teaming up, and the energy industry continuing to point up in both counties.
Labor prosperity has been a major story locally in 2014, but it certainly isn’t the only one on the business landscape. Here is look at what has transpired, and is transpiring, in the southwestern-most corner of Pennsylvania:
• Marcellus turns 10: From an inauspicious start in October 2004 at a Range Resources project known as Renz Well in Mt. Pleasant Township, the massive Marcellus in a short decade has turned Pennsylvania from a net importer to a net exporter of natural gas, created thousands of jobs in the area, significantly lowered home heating bills here, made Southpointe the East Coast commercial center for natural gas drillers and their supply chain partners, and given a promise of much more economic opportunity throughout both counties.
But at year’s end, with OPEC selling oil at the lowest prices in several years, and Gov.-elect Tom Wolf’s promise of a severance tax on gas production, it remained to be seen how drilling activity would be impacted going forward.
• Coal’s highs, lows: Consol Energy in June unveiled its new mammoth coal mine, christening the $700 million project with a new name, in honor of its executive chairman, J. Brett Harvey. During ceremonies at the mine’s Patterson Creek Portal near Sycamore in Greene County, at what is the world’s largest underground coal mine, company officials also celebrated 150 years in the energy business. The new mine employs 2,500 and can process 10,000 tons per hour.
At year’s end, Consol announced plans for a master limited partnership for its thermal coal business, in which the MLP would own interests in the company’s Bailey, Enlow Fork and Harvey mines. The company targeted the MLP for mid-2015.
In August, Alpha Natural Resources said it will close its Emerald Mine in Waynesburg by the end of 2015, citing weak market conditions and the mine’s uncertain geological conditions. Most of the 500 miners were expected to be transferred to Alpha’s Cumberland Mine.
• Southpointe Town Center: The center began drawing some of the 12,000 people who work in the mixed-use development to a number of venues on Main Street that opened between summer and fall. They include Zoup!, All-Star Sports Bar & Grille, Crazy Mocha, Toscana Brick Oven, Southpointe Nails and the Spa & Salon at Southpointe. Tenants in the upper floors of the Town Center complex included the law firms of Burleson and Bowles Rice, as well as Modis, an IT recruiting and staffing specialist; materials handling company High Crush Partners; and a State Farm Insurance office.
In the new year, the Town Center, built by Southpointe II lead developer Horizon Properties, will also welcome a PNC Bank branch, Yum Yum Yogurt, Saga Hibachi Steakhouse & Sushi Bar and Montana’s Rib & Chop House.
• Old Mill: Finally, Max & Erma’s and Olive Garden got some company on this revived site, where the Foundry project collapsed – almost literally – because of subsidence in 2008.
About a dozen stores opened at South Strabane Township’s Old Mill in 2014, a number of them in the third and fourth quarters. They include anchors Field & Stream and Hobby Lobby, plus LongHorn Steakhouse, Buffalo Wild Wings, Krency’s and Anytime Fitness. Penn Station East Coast Subs and a tanning salon are expected to debut soon, Chick fil A in February or March.
“There are only two or three spaces left and there is strong interest in them. I think we’ll have leases in early 2015,” said Andy Boyd, senior asset manager for The Staenberg Group, the St. Louis-based developer of the project.
One of those voids is large – 12,000 square feet between Field & Stream and Hobby Lobby. “We’re in negotiations with several potential tenants (on that),” Boyd said.
• JC Penney: JCP opened in downtown Washington in 1924 and moved to sparkling new Washington Mall in October 1968. Now, 90 years later, it is gone from Washington County.
Corporate shuttered this store May 3, one of 33 it axed nationwide for “underperforming.” The Plano, Texas-based retailer announced its decision Jan. 15, saying it was cutting 2,000 jobs for an annual savings of more than $65 million. That included 100 positions at Washington Mall, which had a hard-core base of shoppers.
• Washington Crown Center: Stagnation concerns have stagnated at the Franklin Township mall, where five tenants moved in and two others remodeled their spaces during the year.
All of this followed the fourth-quarter 2013 opening of Marshalls, a big-box department store.
“We’re really excited. We’ve had close to 85,000 square feet of new development this year,” General Manager Mike Joyce said.
Jo-Ann Fabric and Craft, Ross Dress for Less, Ulta cosmetics, Books A Million! and Encore By Shoe Dept. debuted at Crown Center this year. Kay Jewelers and Europe Nails refurbished their stores.
• Community Bank: Two banks headed by guys named Pat did not stand pat in 2014. The regionally based holding companies for Community Bank and First Federal Savings Bank announced in April that they were merging.
CB Financial Services Inc. of Carmichaels and Monessen-based FedFirst Financial Corp. joined forces in a $54.5 million transaction, which was finalized Oct. 31, The result is a larger CB, with more than $860 million in total assets and 17 branch offices in five counties, including seven in Washington and five in Greene.
Pat McCune remains in charge as president, chief executive officer and vice chairman. Pat O’Brien, FedFirst’s president and CEO, is now senior executive vice president and chief operating officer at CB.
• WesBanco: The week before Thanksgiving, Mike Mooney was giving thanks to Marcellus Shale.
Mooney, WesBanco market president for Western Pennsylvania, was discussing the Wheeling, W.Va.-based company’s expansion in Western Pennsylvania. Not only had it launched a branch in Southpointe II, its 16th in Southwestern Pennsylvania, but it had acquired the 23-branch ESB Bank of Ellwood City on Oct. 30 for $324 million – a deal expected to close in the spring.
“Shale definitely has had an impact [on the firm’s plans],” Mooney said at the Southpointe grand opening Nov. 18 – 15 days after the branch actually began operations.
“We have 71 percent of our offices in the Marcellus Shale region, and after the merger, that number goes to about 90 percent. After the merger, Western Pennsylvania will account for $2.5 billion of the bank’s $8.5 billion in assets.”
• Southpointe II completes land sales: The Washington County Authority, which handles land sales and infrastructure development within the Southpointe II mixed-use business park, completed the sale of the last available parcel to Quattro Investment Group, a subsidiary of Burns & Scalo Real Estate, which is developing the Zenith Ridge office complex in the park. Burns & Scalo intends to construct the third office building for Zenith Ridge.
• Southpointe II buildout continues: In October, engineering software developer Ansys Inc. moved from its original headquarters in Southpointe to Building One of Zenith Ridge.
Also completed this year was an 85-room Holiday Inn Express and Crossgates Inc.’s new 45,000-square-foot building at 300 Woodcliff Drive with leases signed by Rice Energy, Computer Aid, NiSource Midstream Services and Stallion Oilfield Services. Collectively, the companies brought about 200 employees to the site.
Other buildings in Southpointe II that began construction with plans for completion in 2015 included the J. Barry Stout building, where principal tenant Noble Energy, which partners with Southpointe II neighbor Consol Energy, plans to move about 200 employees in the first quarter; and 1400 Main, a 371-unit luxury apartment building that will open in the spring.
• Starpointe: Began building a 104,000-square-foot flex building, half of which will be occupied by Mach 1 Global Services, a current park tenant that is expanding.
• A Meadows ‘campus’: A 155-room upscale Hyatt Place hotel that will connect to The Meadows Casino was one of two projects taking place this year that will contribute to the 180-acre campus for the North Strabane Township entertainment and gaming venue along Racetrack Road, according to Meadows General Manager Sean Sullivan.
The other campus component, “Street at The Meadows,” is being developed by Southpointe-based Horizon Properties on 14.5 acres that fronts Racetrack Road. When it opens later next year, “The Street” will include 90 one- and two-bedroom apartments, several casual dining restaurants and 34,000 square feet of retail space.
• Washington Health System: Outpatients and young patients have new options – and venues – for treatment within this system.
WHS’s outpatient center has been completed, but is not completely occupied, at Meadows Landing in South Strabane. Six tenants moved in this fall and are operational: Tri-State Surgery Center, WHS’s Women’s Center, laboratory draw site, Keystone Pain Consultants, Southwest Gastroenterology and Washington Ear Nose & Throat.
The old emergency department at Washington Hospital – unused since 2009 – has been refashioned into a Children’s Express Care center, for treatment of minor injuries and illnesses. It is open from 5 to 9 weeknights and noon to 8 p.m. Saturdays and Sundays – when pediatrician and family physician offices usually are closed.
WHS partnered with Children’s Hospital of Pittsburgh of UPMC, which now has six Express Care sites in Southwestern Pennsylvania.
Several years ago, it was believed the cornerstone of retail development in Greene County would become Waynesburg Crossing in Franklin Township, site of the Walmart complex.
But Walmart, which opened a store there in March 2009, has remained the development’s only tenant. Waynesburg Crossing, across Route 21 from Greene County Airport, was developed by McHolme Waynesburg LLC, which purchased the land from the county in 2003.
The company sold one lot to Walmart, but failed to find other buyers.
In August 2013, it was reported the remaining properties in the retail development were sold to Kari Resources LP, headed by Gary R. Bowers of Producers Supply in Waynesburg.
Bowers purchased the 152.9 acres for $1.3 million from Land Holding LLC. The sale included all the property in the retail development except the 46.3 acres owned by Walmart.
Robbie Matesic, executive director of Greene County Department of Economic Development, said, “We would very much like to work with him to develop the property in a way that is beneficial to him and to the community. It’s an enormously important property, because of its location.”
While that project remains static, another retail development site is beginning to take shape. Plans have begun to design an access road at Greene County Airport as part of a plan to prepare properties fronting Route 21 for commercial development.
That project had been discussed for years, always with a caveat that the second phase could not begin until the first was completed.
Now, results are visible, particularly with the demolition of old hangars and construction of a T-hangar.
This paves the way for a major part of the project – constructing a road into the airport property that will be aligned with Murtha Drive to make a new four-way intersection at Murtha and Route 21.
All of this, of course, is the end game for the development of parcels along Route 21 for retail and commercial development.
Don Chappel is executive director of Greene County Industrial Development Inc., which markets the 248-acre EverGreene Technology Park adjacent to the county airport in Franklin and Paisley Business Park in Cumberland Township. He saw success at both venues:
• At EverGreene, R.J. Johnson Co., which constructs shafts for the coal mining industry, began moving 28 employees into two new buildings in excess of 33,000 square feet in late 2013. The buildings became fully operational at the start of 2014;
FMC Technologies Inc., a global oil and natural gas equipment service corporation, moved into a new 14,000-square-foot building in the park in July. The company’s operation at the park employs 48 people;
Irwin Car and Equipment, a mine equipment company, also moved in July into a 12,000-square-foot building at EverGreene. The operation employs seven;
During the year, GCID also sold a 10.2-acre parcel at the park to Cameron International, an oil and gas service company. Cameron is expected to begin constructing a new building in the spring;
EverGreene, which has the advantage of being close to the Waynesburg interchange on Interstate 79, has four pad-ready sites open for development, Chappel said.
• At the 72-acre Paisley Business Park at the intersection of Route 21 and Route 188, Universal Belting Resources, a supplier of industrial belts, began construction of a 7,500-square-foot addition to its existing building this year. The addition is expected to be completed in 2015. Three parcels are still available for development.
“I expect 2015 to be even more productive as some of the interest we have right now spills over into next year and comes to fruition,” Chappel said.
Another positive development, perhaps on a lesser scale, was that the former Kyowa America Corp. building on Route 21 in Franklin, vacant for two years, was sold to SunCap Waynesburg LLC for $4.5 million. The property covers 13.3686 acres.
In retail activity, Peebles, a department store chain in existence since 1891, opened at the Widewaters Commons shopping complex outside Waynesburg; McDonald’s reopened in Morrisville; and Taco Bell opened in Greene Plaza on Route 21.
O-R Greene County Bureau Chief Jon Stevens and staff writer Bob Niedbala contributed to this story.