Three local realtors and developers share the commercial and residential projects that have them most excited for 2020.
According to a recent market statistics report by Wade Ragas PhD, MAI, entitled “Single-Family Housing Price Trends New Orleans Metro Area January to June 2018 and 2019,” New Orleans has been in a strong period of economic growth since July 2017. Ragas noted that in the first five months of 2019, the New Orleans economy gained 6,900 jobs while the state gained only 1,900.
This economic growth, he noted, has continued to fuel housing demand.
“Prices rose in nearly every parish,” he wrote in a report published on NOMAR.com. “Within the eight parishes of the Metro area the typical price increase was between 2% and 10%.”
Low interest rates in 2019 also served to help bolster sales.
“I believe we will continue to experience low rates,” says real estate broker Delisha Boyd, who formed Delisha Boyd, LLC, in May 2014 to service Greater New Orleans. “They are a welcomed bonus in our real estate market and increase a buyer’s purchasing power. In addition, the lower interest rates help counteract the current higher home prices. They are a true catalyst to home ownership. It is now cheaper to own a home in New Orleans than it is to rent.”
The following is a look at some of the projects currently being completed or on the way for 2020.
Housing Projects in Marrero and Uptown
While she works to sell the last home among 17 in a small subdivision called Three Oaks in Marrero, developed by Hacienda Construction, Boyd says she’s also excited about a new condominium project currently in the permitting stage that is being developed by Neighborhood Housing Services and Green Coast Enterprises at 4528 Freret Street. The development will include 10 one-bedroom units, 10 two-bedroom units, eight studio apartments and first-floor commercial businesses.
“Once we establish a price point, we will begin presales in the spring of 2020,” she says. “We are anticipating the completion [at] year end 2020 or during the first quarter of 2021.”
Medical & Higher Education Growth
Full-service general contracting and construction management firm The Lemoine Company has several projects underway, including The Garage Condominium in Downtown New Orleans, where a 70-year-old five-story parking garage is being transformed into apartments, condos and retail space.
Lemoine is also working on the Children’s Hospital New Orleans campus expansion and renovation, which includes a 600-vehicle parking garage, a surgical/ICU tower, expansion of the Central Utility Plant, a two-level public circulation concourse and the renovation of the center and west towers, research building and ambulatory care center.
At the same time, Lemoine has taken on the West Jefferson Medical Center campus expansion, which will include renovations to the surgical department, along with renovations and additions to the existing emergency department, south wing patient tower and ambulatory surgery center.
Looking ahead, Lemoine has multiple projects in planning and preconstruction, including the new Cohen College Prep, Downtown UMC parking garage, Northshore Cancer Treatment Facility, Shell Chemical, and the Delgado Community College Nursing, Allied Health, Culinary and Hospitality campus.
“Most are fully funded and expected to break ground by no later than end of first quarter,” says William Lemoine, the company’s vice president of east market New Orleans and healthcare. “We are confident in a strong 2020 with a great deal of activity expected in the medical and hospitality sectors, which we believe will carry into 2021 and beyond,” he says. “In addition, we continue to see new activity and expansion of both the lower and higher education building markets, as well as commercial building in industrial and chemical plants.”
Housing Demand Continues in St. Tammany and Plaquemines Parishes
Outside of Orleans Parish, David L. Waltemath Interests is leading ongoing developments in St. Tammany and Plaquemines. Owner David Waltemath has over 35 years of experience in real estate planning, development, construction and project management.
Waltemath developments include the Bedico Creek Preserve community, a 1,000-acre property that has been transformed into a conservation community development where 60 percent of the land is dedicated to parks and green spaces.
“We have a collection of neighborhoods ranging from $275,000 to $1 million plus,” Waltemath says. “We just opened Bedico Trail — a collection of lots and new homes priced from the $300,000s — which features an amazing island peninsula next to our second pool and park pavilion.”
Waltemath also has two developments located in Belle Chasse: Parks of Plaquemines — a high-end neighborhood of 225 home sites — and Cypress Park, which has 50 completed lots and 65 under construction.
“Both West St Tammany and Plaquemines parishes are in high demand with homebuyers,” he says. “With a shortage of supply in competing neighborhoods, plus our beautiful green space and amenities, we are expecting another great year.”
Anticipated Challenges for 2020
Despite low interest rates, Boyd says a gap still exists between buyers and lenders.
“We have a growing pool of entrepreneurs, as well as young millennials, that don’t have a lengthy work history,” she says. “If lenders are not willing to work with and/or accommodate non-traditional buyers, we will have a growing inventory of homes available.”
Another challenge area is the rising costs of goods and services, which affect a project’s budget, and ultimately its viability.
“We see this having an effect on the actual number of multifamily and hospitality projects that might make it to market in 2020 or 2021,” Lemoine says.
Like so many industries, the real estate and development industries also suffer from workforce development issues.
“Skilled labor forces who are adept in building knowledge and performing safely continue to be a growing concern,” Lemoine says. “With the high levels of construction activity there is a strong need for the builders and trade partners in our market to strengthen our positions on recruiting and training skilled workers, while also standing strong on not sacrificing safety, quality and other standards to meet pricing.”