@Arifa Khandwalla
Right now, the entire real estate investing community of Pittsburgh is obsessed with the question of what the next Lawrenceville is going to be. I don't think there's going to be a next Lawrenceville.
I agree with you completely -- the tech sector only has so much potential in Pittsburgh as things stand.
CMU's robotics department is indeed a very big part of it, but when you look at the combined education endowments of the major Pittsburgh universities compared to places like Palo Alto and Boston, the comparison becomes a joke. There's only so much potential with the money and people that's there. One world-class tech university with $1.72 billion and 13,503 students isn't going to set the tech world on fire.
As you say, young people want urban chic, affordability, walkability, and transit.
Pittsburgh sucks at transit. That could change with the advent of self-driving tech. It will not happen overnight.
Pittsburgh really sucks at urban chic -- most of the area's population defines itself as the polar opposite of chic.
Walkability? Look at the weather, look at the terrain, look at the crumbling infrastructure, look at the perennially impoverished 100% old-union-town Democratic political machine. Making Pittsburgh more walkable outside the areas that have already been snapped up will take serious structural investments, and this town will never have the money to do it.
Pittsburgh is cheap. But so are half-a-dozen other major cities in the Rust Belt. And what do you get for your money? The restaurants? Where are the culinary schools producing quality chefs? They had a shot a few years ago, and then they closed down. I have met little more than disappointment after disappointment eating out in this town, bland boring food praised by locals brought up on little better than pig slop and sugar water.
Let's talk about some other things that young people want: a flourishing art culture with deep roots in the past, good educational opportunities for their young children, diversity, proximity to other major cultural centers, natural beauty. Do I need to go down the list in order? I would instead just focus on diversity. Black people are confined to living in traditional ghettos in this city as surely as if there were barbed wire around them, locked gates, and jackboot-wearing SS on 24-hour patrol. Don't believe me? Get on a bus and talk to members of the African-American community here. Then go on walkabout through some of the white-flight communities in the north of the city and see how many hoods are showing.
The ESL issues in Pittsburgh are legendary. The city and the county largely turn a blind eye to the Hispanic population that is here, working, contributing to the culture. Other nationalities are given equally short shrift. They're all damned foreigners out to take our jobs. Don't believe me? Well, be a Greek-American man and marry an attractive Russian woman here and see how often you're asked if you bought your wife off a website. You can practically smell the backwards hick in the local accent as they ask the miserable question.
Young professionals are NOT flocking to Pittsburgh as the place to be. Some end up here in the tech sector, and they put the bravest face on it they can, but the ones that are here often want out and are looking for every opportunity to get out.
My brother came here in the late 90s to attend CMU and he passed on the same hopeful stories back then - Pittsburgh is changing, Pittsburgh is reinventing itself, Pittsburgh is become new and fresh and different, Pittsburgh will become a tech hub...I've heard over twenty years of broken promises like that, and so I'm not putting any money on the explosive potential of the tech industry to change everything in the region overnight. A flourishing city has no real reason to be here if there is no major transportation happening up and down the rivers, most especially of finished steel, iron ore, and coal. I don't think enough real estate investors ask the question of WHY when it comes to simple geography.
What I am putting my money on is what's obvious and what anyone with access to demographics data can see, as you have. Pittsburgh is destined to have at least 30 more years of oodles of decrepit and dying old people needing care-in-place. They're not going to pack Alzheimers patients in cattle cars and ship them to Florida. They'll need facilities here, and robots aren't going to wipe up after these patients, so they'll need careworkers being paid a modest wage. So I care about inexpensive rentals in safe places with easy commutes to existing and planned facilities. Nursing assistants are not going to go running for A-class rentals as they become available. Registered nurses are so busy that they have no time for anything other than calculating down to the minute how long their commutes will take. Home care aides will go and live wherever facilities for old people are built. That's what I think is going to make the steady money in this town until 2050.
So if I were you, Arifa, as an out-of-town investor, I would sell and get out of Pittsburgh. If there's no spectacular appreciation to be had anymore, and I don't think there will be, this is not a great place of out-of-towners. If the only steady rental growth industry is going to be cheap apartments, you have little hope of competing with the locals, and little incentive to for the piddling money involved.
The city will change, that much is certain. But change for the better, on and on and on? No. Change until the old people die? Yes. And then it will empty, and what will be left will be a much smaller, very different community centered around the much reduced city center and the endowed institutions that will not pick up and move.
