An unexpected benefit from the Marcellus Shale boom is Pittsburgh hotel occupancy has reached the highest level in 21 years USA Today reports. Employees coming from out of town have to sleep somewhere. The parking lots of hotels and motels along the PA turnpike and I-79 are filled with trucks of oil and gas workers. Just like the hotels and motels, development companies are working hard to keep up with the demand for office and warehouse space. The Buncher Company has broken ground on Jackson Township Industrial Park, a 341,000-square-foot flex space north of Cranberry. This will provide much needed flex space for the Cranberry market. Interstate 79 and the PA Turnpike Interstate 76 are only a few miles away and provide easy access for employees to reach drilling sites.
The Southpointe complex in Washington County has also taken advantage of the oil and gas boom. Burns & Scalo has plans to develop 125,000-square-feet office buildings in 2013. The new office buildings will continue to drive oil and gas companies to the area. Range Resources recently moved into a new five-story, 180,000-square-foot building. Pittsburgh can be compared to the California Gold Rush of the 1800′s with everyone wanting to get a piece of the opportunity. The later companies wait, the more the opportunity decreases, and the more they will be paying for office space.
The Pittsburgh area received more good news when Shell announced a land-option agreement with Horsehead Corporation to build an ethane cracker plant in Beaver County, PA. This was a huge victory for Pittsburgh, as Beaver County was selected over locations in Ohio and West Virginia. The plant is estimated to create 10,000 sustainable jobs, and the site is 35 miles northwest of Pittsburgh. Shell and other oil and gas companies are continuing to move to the Pittsburgh area. As these companies continue to move from out of town, it is very important that they work with a local commercial real estate agent. Landlords can take advantage of companies that are not aware of the Pittsburgh market and rates. Pittsburgh currently has a 8% vacancy and landlords are not offering as many concessions and are charging higher rates.