Rebuilding Lost Housing in New Orleans

It may seem a stretch to compare steamy New Orleans with often snowbound Ithaca, N.Y., but the similarities caught the attention of Matt Schwartz, principal of New York-based Domain Cos., which is building a $100 million mixed-income housing development in the flood-ravaged Louisiana city.

Article Tools

Latest News

More Latest News

“Some people find it funny when I first mention it,” says Schwartz, whose firm, co-founded in 2003 with Chris Papamichael, currently has 1,500 housing units valued at $250 million in development in New York State and Louisiana. “We've definitely seen a lot of parallels between Ithaca and New Orleans.”

Both cities have major research universities that spawned biotech corridors and attracted well-paid professionals. While other Upstate New York areas suffered economic slumps, the healthy micro-economy around Cornell University and Ithaca College buffered the city.

Schwartz saw opportunity in New Orleans, where a medical corridor of hospitals and institutes fans out from Tulane Avenue. The developer, a 1999 Tulane University grad, says it ranks 10th among private universities in attracting biotech licensing revenue.

Louisiana State University and the Department of Veterans Affairs are building a $1.2 billion medical complex to replace the Charity and VA hospitals flooded following Hurricane Katrina in 2005. The $94 million Louisiana Cancer Research Center is also underway.

“We realized what research institutions can do in terms of sparking the development of new businesses and high-paying job creation,” explains Schwartz. The 183-unit Preserve Apartments and 228-unit Crescent Club are part of a surge to ease a severe housing shortage.

The developments represent a milestone for New Orleans, says Wil Jacobs, housing policy director for the Louisiana Recovery Authority, which coordinates the state rebuilding effort. “These units are being constructed in the heart of New Orleans, in an area that had been bereft of development for the last 30 years.”

The units will house workers for the medical complex, where 10,000 jobs are being created, Jacobs says. The state lost at least 82,000 rental units and its programs are helping rebuild 35,000 units.

Developers face challenges from lending restrictions to soaring insurance rates (please see story, p. 75). One developer's yearly premium soared from $8,000 to $41,000 after the floods, says Thomas LaTour, a state disaster recovery specialist. Officials offered developers like Domain incentives including zero-interest loans.

The two Domain projects, with amenities like putting greens and computer centers, are being built with $36.7 million of housing tax credits through the Louisiana Housing Finance Agency (LHFA) and $35.5 million in Community Development Block Grant funds through the Louisiana Office of Community Development. About 60% of units will be rented at market rates, and 40% to people earning about $35,000 a year or less. Completion is targeted for late 2008.

The mixed-income housing plan met resistance, says Calvin Parker of the state Office of Community Development. “There were a lot of naysayers,” but 33 projects are underway. “So, it is working.”


Acceptable Use Policy
blog comments powered by Disqus

Photo Galleries

New York's Star Deals

http://nreionline.com/images/nyc_big_deals_homepage_thumb.jpgThe city that never sleeps is also the city that never stops growing, not even in the midst of recession. And deals, both bold and unprecedented, continue to be done. Check out image of New York's big deals.

Hudson Yards Development

http://nreionline.com/photo_gallery/hudson_yardsCheck out images for Coach's new global headquarters, which will anchor the initial tower of the Eastern Rail Yards site within the 26-acre mixed-

Videos

JLL at ICSC 2012

http://nreionline.com/video/bjorson_thumbnail.jpgCheck out these videos from JLL at ICSC 2012 in Las Vegas...

 

Click here to view more videos.


Blogs


http://nreionline.com/blog/schein_blog_headshot.jpg

Real Vox

Traffic Court

The Full Nelson

Events

Strategic Real Estate Investment Conference

Date: Thursday, June 7, 2012
Time: 7:45AM-6:00PM
Place: 1290 Avenue of the America, 5th Floor
What: A full-day event exploring portfolio diversification through opportunistic and alternative investments....

Click here to view more events...

http://nreionline.com/nrei-300x125-house-091211-resourcebook-jpg.jpg

This Week's Most Popular

Current Issue

http://nreionline.com/april2012_cover.jpg

NREI Newsletters



Retail Traffic Newsletters

View NREI Newsletters

NREI Newsline
NREI Seniors Housing Finance and Development
NREI The Green Sheet
NREI Institutional Outlook
NREI Distressed Real Estate Strategies
NREI Daily/Central
NREI Daily/New York
NREI Daily/New Jersey
NREI Weekender
NREI Global Real Estate Monitor
REIT Insider
Retail Traffic Online
The Site Optimizer

Join the Conversation