In January, after Walnut Capital pulled its plans to build Oakland Crossings, a 426-unit apartment building and grocery store in Oakland, from the Planning Commission’s review, the president of the development company blamed inflation, interest rates, rising construction costs and labor shortages for the delay.
Todd Reidbord, Walnut Capital’s president, talking to the Pittsburgh Post-Gazette, described the delay as a “pause.”
What he didn’t mention was that Walnut Capital still didn’t own the land where it wanted to build Oakland Crossings.
On July 18, 2021, Walnut Capital inked a deal with the owners of 19 properties on the 200 and 300 blocks of Halket Street in Oakland to purchase all of the properties for a combined total of $25.6 million.
The developer’s plan was to have the city change the zoning to urban commercial mixed-use by December, buy all of the land in the 200 and 300 blocks on the east side of Halket Street, and then build high-rises — one of which (at the corner where Halket Street meets Zulema Street and the Boulevard of the Allies) would have a grocery store.
The agreement to sell — signed by all of the property owners — called for Walnut Capital to pay the property owners $100,000 each in advance of the closing as hand money. The closing was scheduled in the agreement for Dec. 15, 2021.
However Walnut Capital did not meet that closing date.
Months later, it sent a letter in July 2022 telling the property owners to bring their deeds and any loan payoff paperwork to Two Gateway Center on Aug. 17, 2022. None of the property owners showed up.
Even now, all 19 properties are listed under the original owners’ names on the Allegheny County Real Estate Portal. Walnut Capital is suing the owners of 12 of the properties, those on the 200 block of Halket Street, to force the sales. The owners of the homes on the 300 block of Halket were not named in the lawsuit, which was filed on Feb. 23.
The 300 block is where the developer planned to build the high-rise with a grocery store on the first floor and 426 apartments above. It was to have been one of the first buildings developed in the project.
The agreement, which was filed as an exhibit to the lawsuit, states no one was to disclose the terms of the agreement until the purchase was closed and that none of the terms of the agreement could be “changed, modified or amended, in whole or in part, except in writing, signed by all parties.”
Walnut Capital counted on the zoning changes going through by mid-December so it could close on the sales by Dec. 15, 2021, with those changes in place. But some residents and community groups, such as the Oakland Planning and Development Corporation, opposed rezoning 18 acres of the neighborhood for the development that Walnut Capital had named Oakland Crossings.
The controversy continued as former Mayor Bill Peduto left office in 2022 and Mayor Ed Gainey took over. Gainey further delayed the passage of the new zoning that would allow the project to move forward.
During that time the Halket Street homeowners did not notify Walnut Capital that the developer was in breach of the agreement, according to the lawsuit.
Walnut Capital states in the lawsuit that the company paid more than $1 million for the rezoning, engineering and design of the project.
Pittsburgh City Council passed the zoning changes in June to allow the Oakland Crossings project to go forward on 13 acres.
Then in July, the developer scheduled the closing for August when it would pay the rest of the $1.35 million of the purchase price to the homeowners for the properties. The highest assessment listed for any of the 12 parcels that are the subject of the lawsuit is $285,400. The other 11 properties are assessed between $92,000 and $152,700.
Now the company is seeking to have the court order the homeowners to hand over their deeds and if they don’t, have the Allegheny County Department of Court Records “make, execute and deliver” the deeds necessary for Walnut Capital to take ownership of the property.
Additionally, the company says that when it has possession, it will pay the property owners the purchase price — minus the amount spent on rezoning, engineering and design of the project and all legal fees.
Walnut Capital, through a spokeswoman, would not comment on the litigation.
Dan Casciato, an Allison Park real estate agent who owns the property at 223 Halket St., one of the homes included in the lawsuit, says the homeowners had all agreed not to comment on the lawsuit.
