Giant Eagle's 3 Pittsburgh office buildings go up for auction

Three Pittsburgh office buildings formerly used by Giant Eagle are going up for auction this month, totaling more than 177,000 square feet in the region’s largest industrial park, according to real estate listings.

The buildings in the RIDC O’Hara industrial park are slated to be on the auction block from June 20-23, according to marketing materials from JLL, the commercial real estate firm handling the deal. Giant Eagle doesn't own the three properties, but holds a lease on two of them. The grocer, in an email to WGB, said it is committed to fulfilling those lease obligations. 

The buildings are no longer necessary because the retailer has moved to a work-from-home model since the pandemic began. At one time, 800 Giant Eagle employees worked in the industrial park, according to local reports.

"As is the case with so many other businesses, the COVID-19 pandemic was the catalyst for Giant Eagle’s initial shift to having its corporate support staff work almost entirely remotely," Dan Donovan, the grocer's senior director of corporate communications, said via email. "Over the past three years, our corporate support staff has adjusted well to the remote working environment and as such we have no plans to change that structure.

Up for auction is 701 Alpha Drive (69,019 square feet with a starting bid of $750,000), 101 Kappa Drive (96,000 square feet with a starting bid of $3.5 million) and 649 Alpha Drive (12,600 square feet with a starting bid of $500,000).

All of the buildings are being sold separately or as a trio. Giant Eagle has six years remaining on its lease at 101 Kappa Drive and five years left on its lease at 649 Alpha Drive, according to listing documents.

Giant Eagle decided in December 2020 not to renew its lease at 701 Alpha Drive, according to media reports.

That building, which was built in 1984 and sits on 8.2 acres, is now being marketed as an “excellent repositioning or headquarters opportunity for a buyer looking to enter a stable area with a strong workforce,” according to JLL.  

Giant Eagle currently pays $932,236 a year, with annual increases, for the largest of the spaces, 101 Kappa Drive. The two-story building includes a partial basement and parking.

Giant Eagle’s rent at 649 Alpha Drive is currently $146,562 a year, with a 1.5% increase annually. The single-story building includes about 5,000 square feet of office space and about 7,300 square feet of warehouse space.

Last week, Giant Eagle announced plans to launch a retail media network as part of its “digital transformation.”

The grocer operates more than 470 supermarkets in Pennsylvania, Ohio, West Virginia, Maryland and Indiana.

This story has been updated with information from Giant Eagle.