Retail sales continue to climb in Orleans Parish, due in part to a recent development boom and a crop of younger residents with more money to spend and eager to live downtown, local commercial property developers said Tuesday.
Sales in New Orleans passed pre-Katrina levels in 2012 and grew $500 million from 2013 to 2014, Michael Bucher, a development director at Stirling Properties, said Tuesday during the second day of a two-day symposium at Loyola University that featured forecasts for the region’s economic and real estate trends.
Bucher credited the opening of the Outlet Collection at Riverwalk along the riverfront. That likely kept more sales in the city rather than being siphoned by shopping outlets in the suburbs.
An expansion to Stirling’s Mid-City Marketplace on Carrollton Avenue will add another 40,000 square feet to the development by the end of the year, he said. That includes redeveloping a building to house retail and office space that is already about 75 percent pre-leased.
Although New Orleans’ population is down by about one-fifth from before Hurricane Katrina devastated the region in 2005, the number of residents who are between ages 20 and 34 is up 4 percent and the median household income is up about 18 percent.
“That tells me that there’s a younger profile here of people who are very well-educated who have disposable income,” he said, “and when it comes to retail, that resonates very well.”
Matt Schwartz, cofounder of the Domain Companies, the firm developing the South Market District, a $200 million mixed-use project that will take up four blocks in downtown New Orleans, said he’s seen firsthand the recent interest in downtown living.
The Paramount, the first phase of the South Market development, a $48.4 million building that includes 209 apartments, was leased in less than five months, which was “a very fast pace for a product like that.”
“It’s completely across the board,” he said of interest among potential tenants. “It’s very diverse: a real mix, a lot of people that have lived in the area surrounding downtown that wanted that kind of product downtown, where they could walk to work or have a short commute to work.”
Schwartz said he’s also seen a “major shift in momentum” in interest among retailers, which has allowed the city to lure some upper-end “lifestyle brands” that are now “filing a niche that was largely absent in the downtown market.”
“We’re definitely starting to see a lot more interest among national retailers in New Orleans and downtown, and that process of attracting them has certainly changed a lot over the last several years,” he said.
Follow Richard Thompson on Twitter, @rthompsonMSY.