The board of the Ernest N. Morial Convention Center has selected a master development team for a major project to build an entirely new neighborhood and “entertainment district” on 39 acres of adjacent land owned by the center, a plan that will require more than $20 million in direct public funding and possibly more in tax incentives.
The winning development team is the River District Neighborhood Investors consortium, a partnership between several companies including New Orleans-based Lauricella Land Company, Dallas-based Cypress Equities and New Orleans-based JCH Development.
The scope of the project is huge. The plan includes housing, office space, retail, a new civil rights museum, entertainment space, hotels and more. According to the River District proposal, the new district will see $1 billion of investment to build 2.4 million square feet of new housing and business space. The plan would include 1,100 new residential units, including 450 “workforce and affordable housing units.”
But the proposal is more of a vision statement than an exact plan. The proposal was submitted in October 2019, prior to the coronavirus pandemic. But it, along with a controversial publicly funded hotel, were put on hold last spring after public officials and labor advocates questioned why the Convention Center was moving forward with expensive capital projects when the city’s tourism industry was in tatters, local government agencies were facing massive tax shortfalls and thousands of hospitality workers were unemployed.
The developers said during a presentation on Monday that the pandemic would change some aspects of the plan. Convention Center President Michael Sawaya stressed that more important than the exact plan was picking the right developers.
“We’re choosing a partner and not a plan,” Sawaya said on Wednesday. “Our expectation is to sit down with that chosen partner and come back with a plan.”
The board of the Convention Center — formally named the Exhibition Hall Authority — approved a resolution on Wednesday to allow Sawaya to enter a year-long negotiating period with the developers. The resolution requires Sawaya to provide updates to the board every 30 days.
The ultimate plan will require some public money. To start, the Convention Center, which is largely funded with public dollars, has committed to spending $26 million to prepare the site for construction. The River District proposal also lists several other subsidies that the developers will seek for the project, including low-income housing tax credits, qualified opportunity zone tax incentives, community development block grants and payment in lieu of taxes, or PILOT, agreements.
The plan is years in the making. The Convention Center originally bought the 45 acres of land on its upriver side for roughly $56 million in a series of purchases between 2000 and 2003, Sawaya said on Monday. The original plan was to expand the existing convention center, but that was scrapped after Hurricane Katrina.
Soon after the expansion plan was ditched, the Convention Center began work on creating a new entertainment district that could draw conventions and revitalize a mostly vacant part of the city. The plan was to build a marquee hotel that would be attached to the convention center, with the remaining 39 acres of land used for an entertainment district to help draw people to the hotel and convention center.
The Convention Center board picked a master developer for the hotel in 2019, but after the pandemic-related delay, the developer dropped out of the project in October 2020, throwing the project into flux. The Convention Center is moving ahead with the entertainment district plan anyway.
Sawaya said on Monday that although the entertainment district was necessary to make the hotel financially viable, the entertainment district would be able to stand up on its own without the marquee hotel. The River District developers agreed.
After a request for proposal process in 2019, the Convention Center received pitches from three groups of developers for the entertainment district. Originally, the three teams we’re going to present their proposals on March 23, 2020. But before that happened, the coronavirus crisis kicked into full gear, and the presentations were subject to a series of temporary delays.
Almost a year later, on March 22, the Convention Center board finally heard the presentations. One of the development teams dropped out of the running, leaving just two. The other group was made up of developers including New Orleans-based Woodward Design+Build, Massachusetts-based Carpenter and Co. and New Orleans equity investor Alan Leventhal. The neighborhood would be called “Muse Landing District.”
The River District group put a greater emphasis on the residential side of the development. They said the residential development should come first to create the foundation of the neighborhood before moving on to the entertainment pieces.
The River District group also emphasized the number of local, black and women-owned firms on its team. According to its proposal, the development will have 27 percent Black ownership and 17 percent women ownership.
“We’re thrilled,” said Louis Lauricella, one of the leaders of the River District team. “We’ve worked hard at this. We’ve put together a team that we believe is very reflective of our city. And one of the guiding principles from day one is that we wanted this to be a local team.”
The footprint of the River District neighborhood will be even bigger than the 39 acres owned by the Convention Center. The River District team announced on Monday that they would be purchasing additional acres of adjacent land that includes the Market Street Power Plant. And they said they plan to purchase even more nearby land from Tulane University and the Port of New Orleans.
But don’t expect construction to start tomorrow. The negotiating period to produce a plan will last up to a year. A member of the River District team said on Monday that getting regulatory approval from the City Planning Commission and the City Council could also take a year.
