Multiple bids are expected by Dec. 3 for the purchase of the failed Louisiana ArtWorks building near Lee Circle, including one from a group of restaurateurs who are working with Delgado Community College to turn it into a state-of-the-art cooking school.

“We want to do something with the building,” said Dickie Brennan, a prominent local restaurant owner. He’s a prime mover to create the Delgado culinary arts institute, along with his cousin Ti Martin, another prominent restaurant owner, and Brennan’s brother-in-law George Brower, a financial expert.

The University of New Orleans and Tulane University also would play a role.

Brennan declined to give more details; Monty Sullivan, Delgado’s chancellor, declined to comment.

Taxpayers in New Orleans and throughout Louisiana have a major stake in what happens to the building. They have sunk at least $18 million into it and could spend millions more.

$7.1 millionLoaned by city of New Orleans for ArtWorks building$6.8 millionUnpaid to city as of end of 2012

Delgado received $9 million from the state Legislature this year — as part of a $250 million community-college construction bill — to expand its existing culinary institute, which is housed on its City Park campus. The bill requires Delgado to get an additional 15 percent in funding from other sources.

The ArtWorks building has been closed for two years. Government and private donors spent some $25 million to create a giant artists’ studio, only to see the venture become a widely panned boondoggle that couldn’t generate the revenue to pay its bills.

“Four or five people have indicated that they plan to submit bids,” said William Hines, the Jones Walker law firm managing partner who is leading a newly constituted, five-member board of the nonprofit Louisiana Artists Guild that owns the building and will choose the winner. Hines declined to identify who has called him about the building.

Officials at Corporate Realty have shown the building to seven or eight people, said Hayden Wren III, a senior commercial broker there, adding that he expects more inquiries before the Dec. 3 bid deadline.

“There’s a ton of interest,” Wren said.

A 2012 appraisal valued the building at $4.5 million. “The anticipated sale price is likely to be in this range,” said Douglas Baker, communications director for the state Division of Administration.

“A home run is someone offering the highest price and an arts-related, public purpose use. That would be perfect. My fear is that it won’t be that easy.”—William Hines, leader of effort to sell ArtWorks building

But price won’t be the only factor, Hines said. Because the loans were intended for an arts nonprofit, the winning bidder also must include a “public purpose” and an “arts” component.

This means that a developer who wanted to turn the building into condos or a hotel – as others have done in the Central Business District and the Warehouse District – would have to incorporate some sort of public purpose.

“A home run is someone offering the highest price and an arts-related, public-purpose use,” Hines said. “That would be perfect. My fear is that it won’t be that easy.”

Hines and Wren said potential bidders have been trying to decipher what they would have to do to meet the public purpose criteria.

Hines said one test is whether media outlets would write favorable articles about the winning bidder’s project. Another: “Will the mayor and governor want to come to cut the ribbon?”

City, state could veto sale

The auction is anything but simple, Hines said, because of the public money spent transforming several buildings, including the former Bradford Furniture store, into the ArtWorks complex. The five-story, irregularly shaped building has 93,000 square feet of space and fronts Howard Avenue, Carondelet Street and St. Joseph Street.

Hines said city of New Orleans officials could effectively veto the sale if the board chooses a bid that’s less than what the city is owed from a loan to renovate the building. The outstanding amount was $6.8 million at the end of 2012, city records show — nearly all of a $7.1 million loan made with federal Department of Housing and Urban Development funds.

If the city receives the full amount it is owed, that would free up $630,000 in spending for 2014 – the amount it plans to pay in debt service next year to HUD, documents show. The city is supposed to pay off the entire loan by 2022.

Among the interested bidders in the ArtWorks building is a group that wants to create a culinary arts school. Any proposal for the building must include an arts and a public-purpose component because of the public money that has been poured into the project. It’s unclear whether the city and state will recoup their money. Credit: Corporate Realty

Tyler Gamble, a spokesman for Mayor Mitch Landrieu, declined to say whether the city would accept less than the full amount.

State officials also could exercise a veto if the purchase price does not cover a $2.25 million state loan, Hines said.

Even if the state receives its $2.25 million, Gov. Bobby Jindal and his senior officials could have the final say because the state office of Facilities and Planning Control has to approve the transfer of the land to the winning bidder, said Baker, the state spokesman.

The state poured another $8.45 million in construction money into the building, Baker said, but state officials are not seeking repayment for that.

Hines said the Arts Council of New Orleans chose the four others on the selection board because the previous Artists Guild board was dissolved. They are:

  • Thomas Reese, the current chairman of the Arts Council Board. He’s a professor of art history at Tulane University and executive director of the university’s Roger Thayer Stone Center for Latin American Studies.

  • Donna Klein, the past chairwoman of the Louisiana Artists Guild Board. She is general counsel for Peoples Health, which primarily serves Medicare patients.

  • Beverly Matheney, a civic activist and former member of the boards of the Louisiana Artists Guild and the Arts Council.

  • Tara Carter Hernandez, a former board member of the Arts Council. She is president of JCH Development, a real estate and consulting company.

Tyler Bridges

Tyler Bridges covers Louisiana politics and public policy for The Lens. He returned to New Orleans in 2012 after spending the previous year as a Nieman Fellow at Harvard, where he studied digital journalism....