Given the rash of new residential buildings recently finished or underway in or near New Orleans' Central Business District, the sight of another apartment building construction site may not seem noteworthy. But in light of its surroundings, the development now in progress at 1535 Canal St. is something of a head-turner.
The complex is taking shape on a full block that lies between the CBD and Mid-City, in an area that for decades developers regarded as a no-man's land.
On this site, close to Claiborne Avenue and an elevated stretch of Interstate 10, Dallas-based Provident Realty Advisers Inc. is investing $60 million to build a nine-story luxury apartment complex that will include 330 units, a parking garage and ground-floor retail space.
Setting this project apart is its demographic target. Unlike many neighboring developments that include affordable housing units designed for low-income residents, tenants of the Canal 1535 apartments will pay rents ranging as high as $3,000 a month, according to Matt Harris, Provident's managing director.
Features will include a central courtyard and pool; a fifth-floor deck overlooking both the courtyard and Canal Street; and a parking garage with an upper-level dog park.
Provident Realty Advisers is not alone in venturing into local territory previously considered off-limits. Extensive renovations are nearing completion just across Canal Street, where veteran hotel developer Joseph Jaeger Jr., CEO of the MCC Group, has put $140 million into renovating a decades-old hotel, which soon will open as the Jung Hotel and Residences.
Jaeger stripped the interior of the original hotel building down to its support beams to create 207 upscale guest rooms and 113 one- and two-bedroom luxury apartments. He demolished a smaller building to add a parking garage and created rooftop entertainment areas with pools and a bar. The Jung's ground floor contains nearly 20,000 square feet of space for restaurants and future retail shops.
"The project is considerably more robust than simply a hotel," a spokesman for Jaeger said.
Meanwhile, in the 1600 block of Canal, in the 13-story former ODECO building, which most recently housed the University of New Orleans Foundation, Texas-based developer NewcrestImage soon will open the dual-branded SpringHill and TownPlace Suites by Marriott hotel.
General Manager Chris Anderson said SpringHill Suites, on the building's lower floors, will serve corporate and group travelers. TownPlace Suites, on floors seven through 13, will target extended-stay guests with apartment-like living spaces and full kitchens.
Anderson also hopes to tap into the increasingly popular rooftop bar scene. "I see our bar drawing a local crowd, particularly from the medical district, with great happy hours," he said.
The amount of investment that is pouring into the 1500 and 1600 blocks of Canal Street would have shocked city leaders just a few years ago. That's because chronic building vacancies and deterioration in this area of so-called upper Canal Street reach back some 30 years, when many companies began relocating their business offices away from Canal and into new high-rise buildings that were sprouting a few blocks away along Poydras Street.
The shift of the city's main business corridor left lots of empty buildings along Canal, and while many structures would be renovated into hotels and retail establishments, the blocks near Claiborne Avenue continued to struggle.
But optimism in the area finally is rising, thanks primarily to the opening of the massive new University and Veterans Administration medical centers in the heart of Mid-City. This new hub of health care jobs and the anticipation of increasing medical employment during the next few decades are powerful drivers for development in surrounding areas.
"What you're seeing play out in that area is just the kind of investment that we were trying to attract," said Kurt Weigle, president of the Downtown Development District, referring to long-term plans the agency laid out for Canal Street years ago.
Weigle said a new era is at hand for several blocks that have resisted progress for decades. "I walked that portion of Canal Street 15 years ago," he said, "and when I walk it today, the feel is entirely different."
The DDD's pursuit of commercial development has paid off slowly. An initiative launched around 2005 created new "streetscapes" on the lower part of Canal Street, with tree plantings, new sidewalk pavers and a general upgrading of the street scene.
Efforts to draw more upscale retailers have also started to gel, Weigle said. High-end denim retailer True Religion and professional makeup provider M•A•C, for instance, have moved into spaces on the ground level of the Astor Crowne Plaza hotel at Canal and Bourbon streets.
Across the street, the Art of Shaving provides personal grooming services for men, and the upscale Brazilian steakhouse Fogo de Chao operates on the ground floor of the JW Marriott hotel.
"All of those have increased the quality of the retail experience in that part of Canal," Weigle said. "Now, at the upper end, we're creating a new experience."
Rejuvenation of some parts of Canal Street got a boost from funds that flowed in to help New Orleans recover from Hurricane Katrina. The renovation and reopening of the Saenger Theatre helped draw developers' attention to the area, as did private projects such as the redevelopment of the Krauss department store into upscale apartments, many of which now are being turned into condominiums.
Farther up the street, the New Orleans Bioinnovation Center opened in a sleek high-rise at 1441 Canal to support research into biomedical technologies.
Such efforts gained steam from the redevelopment of the nearby Iberville housing project, a sprawling complex of apartment buildings in the Treme neighborhood that housed thousands of low-income residents.
Most of the old Iberville buildings have been replaced with a mix of residences including apartments and townhomes for renters in a range of income levels. And part of that redevelopment included the conversion of the former Texaco office building at 1501 Canal into affordable apartments for elderly tenants.
These changes coincided with rapid growth in downtown living options that have added thousands of apartments and condominiums as more and more local residents began to show a preference for inner-city homes. "We've got close to 7,000 people living downtown today, about double the total before Katrina," Weigle said.
He and others say that what could put still greater momentum behind downtown growth would be the redevelopment of the former Charity Hospital building on Tulane Avenue. "I think redeveloping Charity and the (former) VA Hospital sites are going to be the next step," he said.
But in the view of some developers who have tackled projects on upper Canal Street, the city should first pay attention to a more pressing priority — public safety.
In addition to opening the Jung Hotel, MCC Development plans to renovate the long-vacant hotel building at 1630 Canal, right next to Claiborne Avenue and the I-10 overpass.
Peter Aamodt, a developer with MCC, said the company some time ago drew up plans to renovate the site into a 200-room hotel, but it ran into financing obstacles that stem in part from worries over conditions in the area. "We have had challenges with that end of Canal Street because of crime in the French Quarter and elsewhere, and the homeless population under the interstate," he said.
Noting that MCC's Canal Street hotels would likely serve many people who visit New Orleans for services at the medical center a few blocks up the street, he said that short jaunt will be more problematic than it should be. "As it is, we're thinking we will have to bus people from the hotel to the medical center rather than make them cross under the interstate," he said.
Aamodt believes that MCC will get the 1630 Canal St. project off the ground and that construction may begin next year. But he says progress throughout the area would speed up if the city would focus more attention on the businesses' environment.
"You're asking a lot for the private developers of these new projects to bear the entire responsibility for public safety in the area," he said.