Stalled plans to expand Bakery Square are being revived in a new rezoning proposal that includes additional affordable rental units and 100 affordable for-sale houses in surrounding neighborhoods.

On Tuesday, the City Planning Commission reviewed plans from Shadyside-based Walnut Capital to expand the 20-acre Bakery Square residential and retail complex through a zoning change.

The commissioners generally lauded the developer’s efforts — held up in the fall amid affordable housing concerns — to expand the special zoning district by 14 acres west along Penn Avenue at the site of a Trader Joe’s grocery store and surrounding retail cluster.

The proposal, which requires a City Council bill amending the district, will return to the commission for a second briefing in two weeks. It must clinch buy-in from both bodies before plans can advance.

In September, a community benefits agreement between East Liberty community groups and Walnut Capital laid out a path to fund various housing efforts as part of a larger effort to expand Bakery Square. But the city’s Zoning Board of Adjustment didn’t take up the request, stalling the expansion efforts. Mayor Ed Gainey weighed in at the time, saying the Bakery Square expansion required more affordable housing.

“I’m not asking Walnut Capital to do anything different than any other developer has done throughout time. Period,” Gainey said during an interview in October. “We know that if we want to stabilize these neighborhoods we need affordable housing.”

Following Tuesday's commission meeting, Olga George, Gainey’s press secretary, said: “While the City Planning standard process is ongoing, we remain hopeful for affordable housing.”

Jonathan Kamin, Walnut Capital’s attorney, said at the meeting that the plan’s original affordability component called for 5% of new apartments to be reserved for people making between 80 to 100% of the area’s median income. But with this latest iteration, Walnut Capital will allocate 15% of new apartments as affordable units, with 10% reserved for people making 50% or below median income and 5% for people making 80 to 100%.

Along with these allocations, Walnut Capital will also help fund an effort to build or rehabilitate 100 affordable for-sale houses in lots around Larimer and East Liberty outside the expansion area. Kamin said more details will be revealed at the next City Planning meeting.

Walnut Capital bought the former Nabisco bakery in 2007, redeveloping the site into retail, office and hotel space. The site boasts Google and other tech brands among its commercial tenants.

A Bakery Square sign.

“We think Bakery Square is the most successful and transformative project in Pittsburgh,” Todd Reidbord, Walnut Capital’s founding partner and president, said to the commissioners on Tuesday. “We started something unique to the city of Pittsburgh. And we always say we're only halfway there. For us, this is a legacy project.”

Reirdbord said that one of Bakery Square’s key assets is its ability to connect the various neighborhoods surrounding the site.

“We think we've been able to work with communities all around Bakery Square to make it a comfortable place for everyone,” Reidbord said. “We're a showpiece. We have bike paths, neighborhood connections. We're the most transit-oriented area in the city.”

Walnut Capital’s team on Tuesday confirmed that the Trader Joe’s market will continue to operate in the area.

These plans help change the design of the area from a suburban strip mall-like design to an urban center where the emphasis moves from cars to alternative forms of transportation, Kamin said.

The 14-acre parcel being eyed for expansion is currently zoned for highway commercial development.

Due to that, Kamin said, “There's not the strong urban core that you would traditionally have … what you see here is not the highest and best use today.”

Correction (6/25/2024): A previous version of this story described plans for the location and operation of a Trader Joe's grocery store based on former statements by Walnut Capital that have since changed.

Eric Jankiewicz is Rtvsrece’s economic development reporter, and can be reached at ericj@rtvsrece.com or on Twitter @ericjankiewicz.

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Eric Jankiewicz is a reporter focused on housing and economic development for Rtvsrece. A native New Yorker, Eric moved to Pittsburgh in 2017 and has since fallen in love with his adopted city, even...