Despite slumping oil prices that have caused thousands of layoffs across Louisiana, the Crescent City is taking forward-moving steps to be poised for economic growth, local business leaders and economists said Tuesday at an annual forecast symposium at Loyola University.
They cited national and local forecasts and credited work in their own fields, including New Orleans' expanding airport; climbing tourism figures that are driving a downtown construction boom; and a growing real estate market that's been aided by a boost in out-of-state buyers.
Frank Nothaft, senior vice president and chief economist for data analytics company CoreLogic, predicted average long-term mortgage rates will "rise from dirt cheap all the way up to low," perhaps hovering below 4 percent until the end of 2017.
"What I see going forward is an extended period of extraordinary low mortgage rates — not dirt cheap, but extraordinarily low, well below 5 percent from now until 2018," he said
Locally, Nothaft said foreclosure sales are down in New Orleans since 2010, "which is good, but it's also contributing to some of that lean inventory that we've seen in the marketplace."
Among recent homebuyers in New Orleans, about two-thirds were people who already lived in the city, while most of the others lived out-of-state, he said, a factor that's also fed rising demand.
As local officials across metro New Orleans work to draw new businesses to the area, a recent selling point may be new international and domestic flights at Louis Armstrong New Orleans International Airport, said Deputy Director and Chief Operations Officer Walter Krygowski.
The local airport's passenger count grew about 37 percent since 2010 and now has 15 airlines and 57 nonstop destinations, he said. That upward trajectory is likely to continue, he said, citing the facility's $950 million expansion, which includes a new three-story, 650,000-square-foot terminal.
The facility is "doing real well as a medium-hub airport," he said, having surpassed the 1 million passenger mark in May, the largest single-month tally in its seven-decade history.
But Krygowski said they've got bigger goals: While almost 10.7 million passengers went through the airport last year, good for No. 37 nationwide, the airport is looking to crack into the top 30 in the U.S. That would place it among airports that handle at least 1 percent of the nation's passengers.
Iftikhar Ahmad, the airport's director of aviation since 2010, was originally slated to speak. However, Ahmad announced last month that he was resigning from his post to oversee Rhode Island's six airports.
"When you start getting into 29, 30, you start edging yourself up to a large hub," Ahmad said. "That's where we would like to be and grow into."
During a question and answer portion of Tuesday's event, Krygowski deferred when asked by an audience member about recent speculation that the airport was close to announcing a nonstop flight between New Orleans and a premiere European destination via British Airways, as The Advocate has reported.
Instead, Krygowski noted the planned return of transatlantic service when the German airline Condor begins seasonal service to Frankfurt next year.
"That's certainly another big win, because it's opening up the whole European markets to our community," he said.
Meanwhile, construction activity continues to boom downtown, thanks in large part to the $1.1 billion University Medical Center, which opened last year, and the $1 billion Veterans Affairs Medical Center.
That additional work includes a Homewood Suites New Orleans French Quarter, a 207-suite hotel being developed by HRI Properties that's expected to open in early 2017.
"The answer is: We're still building, we're still buying, we're still active," said Gary Gutierrez, HRI Lodging's president and chief operating officer.
Already, there are about 4,900 hotel rooms recently added or in the pipeline for the next four years, he said, which will add to an inventory of about 25,000 rooms in and around downtown.
"I certainly feel confident that we can absorb this additional inventory," he said.
Recent numbers back his forecast as New Orleans' annual visitor count neared the 10.1 million people who traveled to the city in 2004 before Katrina’s devastation.
Hospitality leaders are shooting for 13 million visitors by 2018, in time for the city's tercentennial celebration.
Lenny Wormser, senior managing director of Latter & Blum's hospitality division, drew gasps from Tuesday's crowd when he noted that the planned $380 million Four Seasons hotel, slated for the former World Trade Center building, will fetch $650 a night after it's built.
"We have one of the most compelling comeback stories in the country," he said. "This is one of the best illustrations of that."
