Ahead of its tricentennial celebration in 2018, the New Orleans economy is coming off a busy year: After hosting nearly 10.5 million visitors in 2016, the city may have set a new record in 2017, lifted partly by the addition of transatlantic service between the Crescent City and London and Frankfurt.
And returning visitors will soon find some changes in the local landscape, ranging from the apparent — the planned development of the last piece of an uninterrupted three-mile stretch of public riverfront slated for the downriver end of the French Quarter — to the more subtle — a slowly-diversifying tourism economy, underscored when one of the world's biggest technology companies unveiled plans to open a 2,000-person office in the iconic Freeport McMoRan building in the Central Business District, the single largest jobs announcement in the state's history.
Here's a glance at those and other events that made metro area business headlines in 2017, including an ongoing downtown construction boom being driven largely by historic renovations, the nearly $1 billion failure of First NBC Bank, and a rapidly expanding airport that's scheduled to open a new terminal in early 2019.
Job market gains modest
Industrial and other projects enabled the New Orleans metro area to grow in 2017 despite hammer blows delivered by a struggling oil and gas sector — a sector expected to continue struggling over the next two years, with a possible modest recovery dependent upon rising oil prices.
The metro area added about 400 jobs in October compared with the year before, according to the latest figures, putting it among the five (of nine) Louisiana regions that could claim more jobs than a year earlier.
At roughly 578,800 positions, the New Orleans area gained ground in professional and business services positions, which rose by 3,200; construction, up by 1,400; and manufacturing, up 800 jobs. Overall, government agencies lost 2,900 jobs over the year, with local government taking the biggest hit, according to Louisiana Workforce Commission data.
Enormous industrial projects, especially in St. James Parish, will help the New Orleans metro area add 4,600 jobs in 2018 and 7,600 in 2019, according to an annual economic forecast.
The New Orleans area will grow at 0.8 percent in 2018 and 1.3 percent in 2019, making it the state's third-fastest growing metro on a percentage basis, behind Lake Charles and Hammond, according to the Louisiana Economic Outlook.
The New Orleans economy also will benefit from expansions in the health care sector and the National World War II Museum, as well as airport construction.
Of the area's $33.7 billion in industrial announcements, about $11 billion is underway, economist Loren Scott said in the economic forecast.
The projects underway include the first phase of Yuhuang Chemicals' $1.85 billion complex in St. James Parish; Monsanto's $975 million expansion in Luling; and Entergy's $869 million power plant in Montz.
Meanwhile, Scott expects growth to accelerate in 2019 because it will be late 2018 or early 2019 before construction begins on the biggest of the announced projects. Those include Formosa Petrochemicals' $9.4 billion complex in St. James Parish and Venture Global's $8.5 billion liquefied natural gas export facility at the Port of Plaquemines.
DXC growing the tech sector
The metro area's biggest 2017 win isn't reflected yet in the overall numbers: Virginia-based DXC Technology's plans to open a New Orleans office early next year that will eventually employ 2,000 people.
DXC Technology, which describes itself as an "end-to-end IT services company," arrives nearly a decade after Louisiana began working to position itself — and especially New Orleans — as a fledgling technology hub, an effort that was advanced using tax incentives as a recruiting tool and the city's culture as a key selling point.
Valued at more than $25 billion, DXC is roughly the 110th largest company in the world, with 170,000 global employees and nearly 6,000 clients. In New Orleans, it will grow to be among the region's largest employers.
The new jobs, which are expected to pay $63,000 on average, include tech positions and others such as project managers, business analysts, software developers and engineers.
First NBC failure biggest since recession
Perhaps New Orleans' biggest business news of 2017 wasn't tied to the promise of a new company but the collapse of another: First NBC Bank, a one-time darling that failed in April, capping a tumultuous year in which its stock price tumbled by 90 percent.
With concerns mounting about its business practices, state and federal regulators seized the beleaguered bank, closed it and initiated a $1 billion cleanup, making it the costliest failure of an American bank since the height of the 2008-10 financial crisis.
After the seizure, First NBC's best assets were acquired by Whitney parent Hancock Holding Co. in a deal that included $1.6 billion in deposits and $1 billion in assets — including $600 million in cash. The cost to the Federal Deposit Insurance Corp., an arm of the government, was estimated at $1 billion.
In the months since, some clues have emerged as to what caused the bank's portfolio of loans and tax-credit investments to deteriorate so rapidly, absorbing heavy losses in its final months despite efforts to shore up its finances. Recently, an after-the-fact regulatory review confirmed many long-held suspicions about First NBC's banking practices: that its years of rapid growth came at the hands of a domineering chief executive who had grandiose dreams, nearly unfettered authority and an unusual appetite for risk.
Released in November, the 41-page analysis by the FDIC's inspector general found the bank frequently issued or renewed loans to distressed clients even after their long-term prospects were exposed as questionable at best. In many cases, loans were issued without the necessary paperwork or adequate collateral.
While focusing much of its criticism on First NBC's founder and CEO, Ashton Ryan Jr., the report also criticized a lack of oversight by the bank's board as well as by federal and state regulators. What's more, the report offered an assessment on claims of mismanagement just as a federal grand jury has issued subpoenas to the bank's board, upper management and large customers, with an eye toward potentially bringing criminal charges.
Whitney making its move
DXC isn't the only company ready to leave its mark on a Poydras Street high-rise building long associated with the energy companies that once carried Louisiana's fortunes. Whitney Bank plans to move its operations from its headquarters at 228 St. Charles Ave. to One Shell Square, Louisiana's tallest building, which is being renamed the Hancock Whitney Center.
The deal, nearly a year in the making, allows Whitney's Mississippi-based parent, Hancock Holding Co., the opportunity to sign a long-term lease in arguably the city's most iconic office tower and to hoist its name at the top.
The bank and its roughly 400 employees will relocate about three blocks into more modern facilities than Whitney's early 20th-century headquarters, where space has grown tight, forcing the bank to spread out into other nearby structures.
Burgeoning medical sector
Meanwhile, local economic development leaders continue working to diversify New Orleans' tourism-heavy economy, helping usher in a wave of medical construction projects that are expected to add thousands of health-services jobs over the next decade, potentially helping lift the region's low- and middle-skilled workforce.
Thanks in large part to the new $1.1 billion University Medical Center and the $1 billion Veterans Affairs Medical Center, New Orleans' profile as a health care destination has improved, according to a report produced by Greater New Orleans Inc. and funded by Blue Cross and Blue Shield of Louisiana, the state's largest health insurer.
From 2007 to 2016, employment in the metro area's health-sciences sector grew by 27 percent, beating the national growth rate of nearly 10 percent and surpassing New Orleans' pre-Katrina pace, according to the report.
Also to thank for the quick pace: Ochsner Health System, the state's biggest nonprofit health care company, which added more than 4,400 jobs over the past five years.
Ochsner also had a busy year. Construction began on a project that will double the size of the Gayle and Tom Benson Cancer Center at Ochsner Medical Center on Jefferson Highway. The work, funded by a $20 million gift from the Bensons, is part of a $360 million expansion of its main campus that Ochsner first announced in 2015.
Additionally, Ochsner continued growing its footprint in surrounding parishes. Three years after acquiring River Parishes Hospital in St. John the Baptist Parish, Ochsner opened a new $12 million, 20,000-square-foot medical complex there that includes a 13-bed medical facility offering emergency and primary care and laboratory and radiology services.
Ochsner also reached a long-term pact to manage the troubled St. Bernard Parish Hospital in Chalmette, enabling the publicly owned hospital to expand services and operate more efficiently under the bigger Ochsner umbrella. The Chalmette hospital was beset by management issues since it opened in 2012, including problems with billings and collections that caused millions of dollars in losses.
While New Orleans works to bolster its standing as a health care destination, work still remains to be done on promoting its existing medical facilities and the highly trained specialists involved in providing care, officials say. Having the infrastructure in place to do it is a big part of getting there.
Airport flying higher
A nearly $1 billion new terminal is slated to open at Louis Armstrong International Airport in early 2019, a project that's larger and more expensive than initially planned — thanks to the addition of five gates, bringing the total to 35 — to accommodate the city's latest tourism gains. The North Terminal project is being paid for with a combination of bonds, backed by fees on the airlines, plus state and federal money.
Local tourism industry leaders said the project is much needed: More than 11.1 million passengers — including both arrivals and departures — went through the New Orleans airport in 2016, its highest figure ever. That was up nearly 4 percent from the year before. What's more, when the new terminal is open by 2019, the airport expects the number of passengers flying out of the city will be roughly 18 percent greater than was projected for that point in 2013, when the project was first unveiled.
Overseeing the effort is the airport's new aviation director, Kevin Dolliole, a New Orleans native who was named to the top post this year.
The New Orleans airport also added regular transatlantic service this year to two new destinations. After years of recruiting by local officials, British Airways launched direct flights to and from London. Two months later, German airline Condor began seasonal service to and from Frankfurt, a hub that boasts connections to more than 120 destinations, including most of Europe and the Middle East.
Downtown redevelopment accelerates
As visitors continue to fan into the city, they'll likely find a new draw at the city's waterfront, where plans are underway to develop perhaps the country's largest swath of uninterrupted public riverfront access.
Officials at the Port of New Orleans and the Public Belt Railroad approved a swap this year involving two port-owned wharves at the downriver end of the French Quarter in exchange for the city-owned railroad.
Since then, Mayor Mitch Landrieu has floated plans to convert the wharves into a park connecting Crescent Park along the Marigny and Bywater riverfront with the Moonwalk and Woldenberg Riverfront Park in the Quarter, creating a more than three-mile park stretching from near the Industrial Canal to Spanish Plaza.
The framework of the swap was announced in June after months of uncertainty over the fate of the Public Belt, which manages 26 miles of track connecting six major rail lines serving the port and industrial facilities.
Before the announcement, Landrieu had spent nearly two years publicly weighing the idea of selling or leasing the Public Belt to a private firm to generate revenue for the city. Five firms expressed interest in taking it over, which could have netted as much as $55 million upfront and another $76 million over 40 years.
However, port officials and railroad customers vocally opposed the notion, worried that a private operator would focus more on increasing revenue than keeping costs down.
Construction boom hums along
Nearby, close to the foot of Canal Street, a prominent high-rise hotel changed hands again, just as the nearby riverfront appears primed for activity.
More than three decades after it was built, the Westin New Orleans Canal Place Hotel was purchased by a group led by Berger Co., in partnership with Cerberus Real Estate Capital Management, a New York-based investment firm. The deal came together less than two years after the New Orleans-based Berger Co. and Ogden Development sold the Shops at Canal Place, an adjacent, high-end shopping and entertainment center housed in the 32-story Canal Place complex in the 300 block of Canal Street.
The 437-room, 29-story Westin hotel has changed hands several times since it was built in 1984, but this marked the first transaction that put it under local ownership.
Additionally, Berger has been involved in talks to build a 1,200-room hotel at the upriver end of the Ernest N. Morial Convention Center, part of a broader expansion project that could eventually include residences, restaurants and a performance venue.
Not far away, after being stalled for more than two years by litigation, work finally is underway to transform the former World Trade Center building at the foot of Canal into a Four Seasons Hotel and condominiums. The potentially $400 million project is slated to bring one of the world's most prestigious hotel brands to the city.
When the Four Season opens, likely in 2020, the hotel will be a big piece of a recent construction boom in New Orleans that has included nearly two dozen hotels in various stages of construction or conversion. The effort has gained steam as the city's tourism numbers have picked up in recent years.
The National WWII Museum is also getting involved, breaking ground in December on the eight-story, $67 million Higgins Hotel and Conference Center. It's one of the final pieces of the sprawling educational complex dedicated to celebrating America's involvement in World War II. The 230-room hotel is scheduled to open in 2019.
Elsewhere across the city, a hotel construction boom continued humming.
After decades of dormancy, the NOPSI Hotel opened at Baronne and Union streets, with the renovated 1920s-era building breathing even more new life into an area of New Orleans that's buzzing with new development.