The Steel City Refuses to Rust

After years of economic restructuring and in spite of a dwindling population, the Steel City is perhaps better than ever. Pittsburgh must be doing something right because The White House chose it as host of the upcoming G-20 Summit of world leaders. City officials hail the event as a chance to showcase the major improvements and attract future events. The Summit also confirms Pittsburgh's new status as a world-class city and the great American success story.


There are myriad reasons behind this success. For one the area is home to the 8th largest concentration of Fortune 500 companies nationwide, partly behind Pittsburgh's low unemployment rate and its remarkable personal income growth rate. Steel and coal giants, US Steel and CONSOL are still big players in town but the University of Pittsburgh Medical Center is now the area's largest employer. Another top employer in town is PNC Bank, which grew to become the country's 5th largest financial institution through acquisitions and its avoidance of the sub-prime mess. These large institutions are all packed into the nation's 6th densest central business district--a great place to locate your business as well.


Don't let its small population of roughly 315,000 people fool you. Pittsburgh definitely has all of the normal big city amenities: from major league sports teams to world class museums and theaters; from first-rate shopping to skyscrapers--this is definitely a major cultural and economic hub. Thanks to all this town has to offer, smart investors know that Pittsburgh is both undervalued and poised for economic growth.


It seems like just about everyone's talking about the Steel City:


- Forbes named Pittsburgh its 6th best city for job growth in 2009.


- The Economist declared Pittsburgh the 29th most livable city in the world, beating out every other city in the US.


- Mercer ranks Pittsburgh as having amongst the lowest costs of living nationwide.


- The New York Times can't seem to get enough of the Steel City, calling it both "cool" and "hip."


A renaissance is currently underway in the heart of town. Old factories and historic office buildings have recently been converted into condos, bringing thousands of new residents downtown. Several miles of the riverfront are being redeveloped and major projects are sprouting up around town:


- North Shore Center. Early this year the North Shore redevelopment brought hotels, office buildings, and retail to the area adjacent to the stadiums and new casino.



- Three PNC Plaza. Two weeks ago, Three PNC Plaza, the first skyscraper to be built since 1987 opened. A LEED certified building, the project includes a Fairmont hotel, condos, retail, and office space.


- August Wilson Center for African American Culture. Opened earlier this year, the center brought a new theater, museum, and classrooms to Pittsburgh's cultural district.


- Casino Gaming. The Rivers Casino opens this week on the city's North Shore, bringing 1000 jobs and the potential for more tourists.



- New Arena. The Consol Energy Center, is currently under construction to provide a new home for the NHL champions, the Pittsburgh Penguins. The arena will open in time for the 2010-11 season.


- Point Park University Expansion. The university recently purchased buildings along Wood Street in hopes of creating an attractive and livable university neighborhood in the heart of town. It plans to build a new academic village, a theater, residential halls, student centers and a park.


- Light Rail/Subway North Extension. The ambitions plan calls for an underground station at the convention center and a tunnel connecting to the North Shore.


For the aforementioned reasons and many more, Pittsburgh is one of America's best up-and-coming investment destinations. Below, we've listed our top 3 ways to invest in the Steel City:


1. Downtown Housing. Since only 5,000 people actually live downtown and due to a growing sentiment amongst suburbanites to live closer to their downtown jobs, an investment in downtown housing could be a good idea. There is growth in this housing market through the conversion of older buildings or developing on parking lots; however, the city government is providing incentives to developers who convert vacant upper levels of office buildings into residential space. Downtown's small size and high density of office buildings means that there is potential for property appreciation.


2. Downtown Retail. Locate a restaurant or other retail establishment in the re-emerging Market Square district or the North Shore. These areas are currently undergoing revitalization; Market Square Place is within walking distance from several Fortune 500 companies and the North Shore center gives you access to sports fans and casino goers.


3. Single-Family Homes. Nearly 50% of Pittsburgh homes have sold for less than $ 100,000 this year, but prices could go higher once the national real estate market gets better. You might be able to find a better deal than you think, especially if you're willing to buy a fixer-upper. Check the
city's inventory as well as other sources for foreclosed and distressed properties.

Top 10 Fastest Growing Economies

The global economic recession doesn't mean that every economy has to suffer. The following list features countries that are still witnessing stellar economic growth rates, although slightly lower than in previous years. The majority of the countries on our list are in Sub-Saharan Africa, which are both diversifying away from primarily commodities-based economies and developing infrastructure. The remaining countries on the list are in Asia. Western nations, specifically in Europe suffered the biggest declines and aren't expected to see positive growth until 2011.



10. The Gambia +3.8%

Down considerably from last year's growth rate of more than 6%, Gambia was affected by a decline in commodities prices. Agriculture makes up the vast majority of the West African nation's economy, but tourism is now its fastest growing sector. Most tourists are European, but future growth in the industry will depend on expanding to include American tourists as well.










9. Indonesia +4.2%

Although its economic growth has slowed to a 6-year low, continued growth in government and consumer spending has kept the economy afloat. Most government and private sector development has gone primarily to the telecommunications and transportation industries which saw double-digit growth rates.






8. Tanzania +5.3%

Tanzania continues to grow, albeit less than last year, as it is less dependent on agriculture. Significant growth has been seen in the tourism, services, and mining sectors. The mining industry has grown so much that Tanzania is now Africa's third biggest gold producer, with metals exports growing at an average annual rate of 4%.






7. India +5.8%

After growing by nearly 9% in 2008 and close to 10% in 2007, things have definitely slowed down. A sharp decline in FDI of over 40% is certainly to blame, as the US overtook India as the second largest recipient of FDI this year. Economists are optimistic that economic growth will pick up in 2010, but don't expect a return to its normal 9% rate until 2011.









6. Djibouti +6.5%

A key port of entry to East Africa and the Red Sea, Djibouti has been a key recipient of FDI in the region. Most of that investment has gone to the service sector, which makes up over three quarters of the economy. Although, Djibouti's banks have benefited most, future growth will be in infrastructure--specifically with the development of Al-Nour city and intercontinental bridge projects.










5. Republic of Congo (Brazzaville) 6.5%

The growth of the oil sector over the past decade has contributed to its robust average annual growth rate of over 7% from 2005 to 2008. Home to a portion of the world's second largest rain forest, there is potential for future growth in eco-tourism as well as infrastructure development in the capital, in which 1/3 of the country resides.










4. Ethiopia 6.5%

The government's program to pave and expand the country's roadways is mainly responsible for continuing economic growth this year. As a result, travel times have been cut in half, vastly improving the flow of commerce.

Despite a slower demand for the country's chief export, coffee, lower oil prices have pretty much balanced things out. Future growth is seen in the growth of luxury exports such as leather.






3. China +7%

After slowing to a rate of 6.1% during the first quarter, China recently returned to its normal average annual rate of nearly 8%--in line with government forecasts. The "easy credit" stimulus program pushed the growth of both consumer spending and exports back to double digits. Nonetheless, the government cautions that recent growth depends largely on the stimulus due to a worldwide decline in demand for Chinese goods.









2. Malawi +7%

Surging corn, tobacco, and telecommunications industries have propelled Malawi to become Africa's fastest growing economy. Although things have slowed down this year, the country is still growing briskly. Further growth can be seen in other agricultural products like tea and sugar as well as in the eco-tourism sector thanks to Lake Malawi and wildlife.







1. Qatar +9%
Not nearly as popular as other Persian Gulf investment destinations, Qatar offers the world's fastest growing economy and one of its wealthiest consumer markets. With 15 Billion in oil reserves, the petroleum industry has long been the cornerstone of its economy. As a result, the national GDP per capita is one of the world's highest at over $65,000.


In order to maintain economic growth, Qatar has realized the need to diversify. With 5% of the world's natural gas resources, the gas industry has recently become the largest contributor to the national GDP. But, government plans to boost tourism to 1.4 million annual visitors will help revive its retail and hospitality industries.










* Average economic growth rates calculated for the first half of 2009 using respective national government and IMF data resources. Images courtesy of respective government tourism agencies.