After years of failed attempts, the redevelopment of the former World Trade Center building is poised to move forward after the city approved a 99-year lease giving developers control of the site at the foot of Canal Street.
The highly anticipated, $364 million redevelopment, which Mayor Mitch Landrieu’s administration has touted as a key project that it wants up and running for the city’s tricentennial in 2018, will include a 350-room Four Seasons hotel and 76 hotel-serviced condominiums.
The lease, which was previously approved by the board of the New Orleans Building Corp., sailed through the City Council with a unanimous vote in support early Thursday afternoon and was signed by Landrieu before the day was out.
That cements the deal between the city, which owns the vacant 33-story, 1960s office building, and the development team of Carpenter & Co. and Woodward Design + Build.
“I’m very excited about the Carpenter/Woodward venture,” Councilwoman Susan Guidry said. “Bringing the Four Seasons brand to New Orleans should be a game-changer.”
The lease calls for the developers to pay the city $3.5 million a year in rent for the first 10 years, $3.75 million a year for the next 10 years and then an amount that would be adjusted based on the consumer price index. The city also would get a share of the proceeds of a cultural attraction to be built on the property and of certain other elements of the project.
The city also will benefit from property taxes generated by the project, though if those are high enough, they would be used to offset a portion of the rent payments.
Redeveloping the WTC building has been a city goal for many years, but all previous attempts failed to materialize. The most recent attempt, last year, fell apart because the chosen developer and the city could not agree on what the building was worth.
That set off a second attempt to seek interested developers, which drew 11 proposals, later cut to five finalists. The Carpenter team was selected to helm the project in March.
Referring to a rendering of the final plan, Landrieu drew a stark contrast between the existing, vacant building and “the way the river could have always looked, had we done it right.”
“We’re going to reveal to the world New Orleans the way it always should have been,” he said.
Construction is expected to begin this fall, with a grand opening expected in December 2017.
The plan also cleared another hurdle Thursday when a Civil District Court judge refused to grant a restraining order sought by one of the losing bidders that would have prevented the lease from going through.
While the suit brought by Two Canal Street Investors, whose proposal was ranked last among the five analyzed by a selection committee, will continue in the courts, a restraining order would have forced the city to delay moving forward on the lease.
The details of exactly who will be working on the project raised some concerns Thursday, with several residents and advocacy groups questioning whether the lease contains enough safeguards to ensure that “disadvantaged business enterprises” — companies owned by minorities or women — will receive the work promised by the developers.
“No longer should the rich get richer off public assets and dollars and the whole entire community continue to lose,” resident Steven Kennedy told the council. He added, “We need to make sure minorities and disadvantaged businesses have real opportunities.”
Kennedy pushed for provisions that would require the operators of the hotel also to focus on DBEs.
Colette Tippy, with the workers advocacy group Stand With Dignity, said she fears there will not be opportunities for workers to be trained on the site — allowing them to improve their situation — and that the construction jobs will not pay enough.
However, City Council members and Landrieu administration officials said the Carpenter team presented one of the best proposals for DBE participation of any of the companies involved in the process and the city will be monitoring the work to make sure the project adheres to those terms. To ensure compliance with those provisions and other elements of the lease, the city has required the developers to put up a $1 million deposit.
“We understand what the lease says. We intend to live up to our part of the bargain,” Woodward President Paul Flower said.
While acknowledging that some past projects did not live up to their promise in terms of employment, Councilman Jason Williams pledged this one would be different.
“We have seen language like this before, and we have seen contracts like this before, but we have not seen execution like this in the past,” Williams said. “But I would say you haven’t seen this council.”
Follow Jeff Adelson on Twitter, @jadelson.