Developers visualize a viable shopping district that could compete with Lakeside Shopping Center.
Developers tapped to recreate the Iberville public housing complex believe they can also build a retail development nearby that could rival Lakeside Shopping Center.
View full sizeDiscussion around a proposed federal grant has mostly centered on the redevelopment of the Iberville public housing development. But co-developer Pres Kabacoff believes that the larger, less historic real estate on the lake side of Basin Street can provide the base for a substantial retail development long desired by New Orleanians accustomed to driving to Metairie for everything.The Housing Authority of New Orleans and the city are hoping for the chance to redo Iberville with a Choice Neighborhoods grant from the federal Department of Housing and Urban Development. The program will award a total of $62 million for perhaps as few as two sites. HUD officials won't say how many are in the running.
A public investment of that magnitude could do more than just recast the old brick housing development at the edge of the French Quarter, officials and developers say. With a simultaneous boost from two new hospitals and a possible government reuse of Charity, they say, that part of downtown could see its population triple and its median income rise exponentially -- and in turn become an attractive site for retailers.
New Orleanians have long lamented the decline of Canal Street shopping and the need to go elsewhere for even the most basic goods.
'Canal Street was our thoroughfare'
Iberville residents mourn the loss of shopping too, said Elaine "Mawmaw" Robiho, 62, a member of the new seven-member Iberville resident committee giving input on the redevelopment. "They wouldn't mind seeing Canal Street revitalized, that's what people back here say," said Robiho, waxing nostalgic for the days of shopping nearby at Maison Blanche and D.H. Holmes department stores. "Canal Street was our thoroughfare where we met anyone and everyone," she said.
Developer Pres Kabacoff, who was tapped by HANO to lead the envisioned Iberville redevelopment, said that a key reason for the downtown retail desert is that the French Quarter portion of Canal and its narrow side-by-side buildings provide few available properties big enough for national and big-box retailers to make a profit.
Those impediments fall away across Basin Street, said Kabacoff, pointing to a cluster of underused real estate with larger available parcels and few historic buildings. It's there -- between Iberville and the old Charity Hospital site -- that Kabacoff envisions a "major retail center," with the range of stores found at a suburban shopping center but built onto a much smaller footprint in a way that complements the city's historic architecture. Residential housing would be mixed with stores, which would front onto vibrant sidewalks and streets, he said.
"If you get the retail, you have transformed the city," he said.
Kabacoff, who's both a shrewd businessman and a hopeless romantic when it comes to his hometown, said he believes the Iberville redevelopment could be "the most transformative" project of his lifetime.
A return to splendor?
After co-chairing the housing task force for Mayor Mitch Landrieu's transition team, he wrote an sprawling essay called "A Return to Splendor" about how New Orleans is uniquely positioned to revive its historic neighborhoods. And he's passionate enough about his newest project to spend four straight hours discussing it in a conversation that included three different PowerPoints, several handouts and one conference call.
Kabacoff's firm, HRI Properties, which redeveloped the St. Thomas complex into the mixed-income River Garden community, is remembered for bringing the controversial but much-used Walmart to the edge of the former complex, on Tchoupitoulas Street. In order to finance the housing, the City Council and the State Bond Commission made a highly debated decision to divert sales tax from the city treasury by authorizing a tax-increment financing district, or TIF. The sales tax was used to cover $20 million in bonds, which went to HRI to pay for much of the market-rate housing in River Garden.
A TIF or some sort of public subsidy would also be necessary to pull off the new mixed-use retail district, Kabacoff said. "No major catalytic project in the U.S. can be accomplished in this economy without fed, state and/or local subsidy," he wrote in an e-mail, adding that "public subsidy should be made available for those projects that will stimulate revitalization."
For the Iberville redevelopment, HRI will partner with St. Louis developer McCormack Baron Salazar, which has redone public housing sites across the nation, including the former C.J. Peete site in New Orleans, now re-named Harmony Oaks.
A lot of 'ifs'
The shopping development Kabacoff envisions nearby is far from a done deal, he emphasized. There are no contracted retailers. There is no design.
But a shopping destination can be created, Kabacoff said, if all -- or most -- of several chips fall into place: If HUD gives one of its few Choice Neighborhoods grants to Iberville. If the state puts together the necessary money for the state teaching hospital, the successor to Charity. If City Hall relocates to the 1-million-square-foot Charity Hospital building, which is owned by the state. Some observers have named it as a good choice for the government complex and historic architects believe it could be renovated into an Art Deco jewel.
While the city is partnering with HANO and its developers for the Choice Neighborhoods grant, Deputy Mayor Cedric Grant said the administration has not committed to city occupancy in the Charity building. Instead, he said only that the "adaptive reuse of Charity Hospital" was part of a larger vision for a redeveloped New Orleans, and that the city was working with the state to consider options.
But Kabacoff noted that Landrieu has been clear that the current City Hall is outmoded. And, in Kabacoff's view, a move to the Charity building would be "a lot more important than just a new house: It would also kick-start a transformation of the city. Two birds with one stone."
Other projects on drawing board
The timing for a transformation of the Iberville area is right in other ways, said Tara Hernandez, the development team's retail specialist. Just a few weeks ago, the City Council approved a 52-year lease with the Saenger Theatre Partnership of Houston, clearing the way for a $46 million redevelopment. Also, she noted that the Regional Transit Authority has set its sights on a St. Claude Avenue streetcar and is trying to secure its share of financing for the corridor in order to vie for a federal grant that would cover the rest.
Meanwhile, Target, Walmart and other national retailers recently announced that they plan to open smaller stores in urban areas, Hernandez said. Some have said that the announcements signal not only a willingness to consider core city locations but also that the retailers have saturated the suburbs and need to turn to cities.
The retailers' announcements come in the wake of recent research by Social Compact, the Brookings Institution and other groups, which has shown that urban market data has been poorly gathered in the past, leading retailers to opt against stores in core cities.
Hernandez seemed confident that major retailers can be persuaded to locate downtown. "We know that there's a demand, that there are retail sales that leave this area every day and go to other parishes," she said.
The estimated 2,200 apartments that are likely to be part of the Iberville proposal would not only provide needed workforce housing for downtown workers but will ensure a critical mass of customers for prospective retailers, said Eugenie Birch, co-chairwoman of the Penn Institute for Urban Research in Philadelphia and an expert in the nation's downtown areas.
In general, Iberville residents say, they can bank, see a doctor, and pick up prescriptions within walking distance of their homes. But the commmunity is direly in need a grocery store, "not a corner store," said resident and Council President Kim Piper.
Kabacoff believes that in addition to the retail district on the Uptown side of Iberville, a grocery store can also be secured for the former Winn-Dixie site on the downtown side of the development.
Necessities like these "are a huge chicken-egg issue," Birch said, recalling how developers subsidized a grocery store during the early days of development in lower Manhattan, a step that may be unnecessary with today's retail data, which shows that downtown stores can be profitable.
Birch has looked at trends and changes since 1970 in about 45 downtown areas, including New Orleans, and has seen dramatic changes.
"Downtowns used to be the exclusive holder of jobs, but now most job starts are in the suburbs," she said. "So today downtowns don't have the jobs and certainly don't have the retail," she said.
In response, downtowns reinvented themselves. Over the past few decades, an increased emphasis on housing has transformed downtowns from daytime-only destinations into round-the-clock neighborhoods. The result: downtown neighborhoods that are attractive both for retirees who want to walk home from a late dinner at a sidewalk cafe and surgical technicians who have to be at work at 5 a.m.
But downtown living doesn't attract the same people who live in the rest of the city.
Instead, a distinct downtown demographic has emerged across the country. Nearly three-quarters fall into a category that Birch terms "non-families": mostly young adults and childless couples. Downtown residents are also more likely to be college educated than the city in general.
According to Birch's analysis of four dozen cities, downtown New Orleans -- defined roughly as the Central Business District, the Warehouse District, and a portion of Mid-City -- has the nation's sixth-highest share of 45- to 64-year-olds. That group includes "empty nester" couples who move downtown after raising children, a demographic found in most revitalized downtowns. Such households often have higher disposable income.
There still are very poor people living in parts of downtown New Orleans and other cities. But the reason more wealthy people are moving downtown is because they can afford to make that choice: core-city land is costly, which pushes up rents, Birch said. A large tract of public land like the Iberville site reduces development costs and ensures that downtown can also be home to families of little means, she said.
Choice Neighborhoods requires that all of the Iberville 821 public housing-level rentals be replaced. Typical mixed-income redevelopments set a ratio of one-third public housing, with the remaining two-thirds divided into two other tiers: the top, market-rate apartments and a midrange tier financed by low-income housing tax credits.
Birch recalled how she and a graduate student flew to 45 different cities and then drove into downtown, asking themselves if they'd want to live there. She since used that same gauge to predict whether new downtown developments will succeed.
"In places like New Orleans, where you can walk to the river, to restaurants, of course it will work," she said. "It's an interesting place to walk around and be."
Katy Reckdahl can be reached at kreckdahl@timespicayune.com or 504.826.3396.