The Times-Picayune – The odd sight of New Orleanians makin‘ groceries in the 700 block of Baronne Street on Tuesday morning offered the latest evidence that the city’s once-moribund downtown is continuing to morph from a land of surface parking lots and blighted buildings into a living, breathing neighborhood. The debut of a 40,000-square foot Rouses Market — the first full-service grocery to open its doors in the Central Business District in 45 years — fills a void for a sector that has seen significant residential growth in the past decade.
Perhaps more important for retailers, the data center found that 62 percent of downtown households are individuals living alone, meaning they are more apt to have disposable income to burn.
Developer Brian Gibbs believes the new grocery could be the missing link for prospective transplants contemplating a lifestyle change.
“Part of the appeal of living down here is the idea that you won’t be stuck in traffic all the time,” said Gibbs, who has invested more than $85 million in a pair of residential developments just a stone’s throw from the supermarket.
“But if you have restaurants, bars, museums and sport venues all within walking distance, it’s a bit of a headache not to have groceries. I would say this opens up the field of those who would consider living here. If a grocery store is among your critical items, now you can scratch that deficiency off your list.”
With well over a half-billion dollars of new investment flowing into the area, residential development is only part of the story of the downtown rebirth.
The Hyatt Regency New Orleans reopened in October after a $243 million renovation. The Benson family continues to build out its $100 million office-sports-entertainment district alongside the Superdome. And in July, the 155-unit Saratoga Lofts apartment building opened at 212 Loyola Ave.
Meanwhile, the Regional Transit Authority is on schedule to launch a new streetcar line along Loyola Avenue next summer, sparking optimism that more projects are on the way.
“It’s just another very strong anchor,” Mayor Mitch Landrieu said, minutes after picking up a Rouses broccoli salad to take back to City Hall. “It’s what I call a fundamental foundation to re-creating a neighborhood that’s really never existed like this before.
“This neighborhood, for the most part, is well on its way to being completely transformed.”
Downtown Development District director Kurt Weigle says that even with downtown’s residential growth, the grocery industry usually estimates it needs twice as many people to support a supermarket the size of the new Rouses.
“Typically, retailers tend to look at those statistics,” Weigle said. “And a lot of them will operate based solely on those statistics.”
But Weigle said the family-run grocery chain, which operates 37 other locations across the state, is banking on the vibrancy of the entire downtown area, confident that workers will shop on the way home and on lunch breaks and that sporting and music events at the Superdome and the New Orleans Arena will bring in other customers.
‘Success begets success’
Donny Rouse, managing partner of the grocery chain, acknowledged that his company might be taking a risk.
“This neighborhood is very unique,”‘ he said. “It’s the most unique area that we’re in.
“But you look around and you see a lot of office buildings, a lot of apartments, a lot of new development that’s going to come behind us in the near future bringing more condos and more office area. So it’s exciting.”
Councilwoman Stacy Head, who represents the CBD, said downtown has been adding 300 to 500 households annually in recent years, and she expects the growth to continue.
“It’s sort of success begets success,” Head said. “So the number of households made it possible for Rouses to feed the future and to invest in downtown. Now Rouses will in turn encourage more people to live downtown because of the quality of life improvement.”
Across the street from the Rouses parking lot, colorful signs recently went up heralding the coming of the South Market District, a proposed $200 million residential-retail development targeted for at least four large surface lots between Loyola and Baronne streets.
Matt Schwartz, principal at the Domain Cos., said he expects to break ground on the project next summer.
Schwartz said the start of construction on the streetcar line, along with the openings of the Hyatt and Rouses, have made it easier to sell his vision of 450 apartments and 125,000 square feet of shops and restaurants to prospective lenders.
“We were out there all morning this morning with some lenders from Texas,” Schwartz said last week. “It’s very different from when we were out there in July.”
Humming right along
Progress has been steady. The city has approved Domain’s infrastructure plan, its request to close a lane of traffic in each direction on Girod Street so that it could widen the sidewalks to support outdoor cafes, and a zoning change to allow those cafes.
Meanwhile, state Rep. Helena Moreno passed a bill in the Louisiana Legislature earlier this year that extended the definition of the Louisiana Enterprise Zone Act to include South Market District to help the project’s financing.
Domain hopes to use New Markets Tax Credits to help finance the project. The company should have a better idea of how the financing will work out in January after the federal government allocates the amount of tax credits that will be available.
Schwartz said conversations with prospective retailers and restaurant operators are ongoing.
Less certain is the fate of the nearby Plaza Tower, which is under contract to be sold by month’s end.
The vacant and gutted 45-story skyscraper at 1001 Howard Ave., which had most recently been slated to become shops, offices and residential living units, went to auction on Sept. 20.
Corporate Realty of New Orleans and DJM Realty of New York, which accepted bids and evaluated offers, said the winner of the auction will be announced after the deal closes late this month.
Upbeat about the future
With the downtown resurgence coinciding with more than $2 billion in construction under way on a new federal veterans hospital and a state teaching hospital, Landrieu said developments like the South Market District are no longer considered “pie-in-the-sky” ideas.
“One of the things that does is give the private sector confidence that the framework has been set and the foundation has been laid,” he said. “And that their willingness to risk is a much better bet today than it was four years ago.”
Lost on some in the euphoria of Tuesday’s festive supermarket opening was the fact that the new business was filling an empty shell left by a car dealership that closed after Hurricane Katrina.
“I think if you would have asked people five years ago if they ever thought Sewell Cadillac could be transformed into one of the finest residential supermarkets in the country, they would say, ‘That’s crazy, that doesn’t make any sense,'”‘ Landrieu said. “Well, actually it does make a lot of sense.”
By: Frank Donze and Rebecca Mowbray