Top Ten Stories of the Year
A look at the headlines that changed business in 2017
1 | Healthcare Industry Explosion
New Orleans is leading the nation.
By Kim Singletary
Greater New Orleans currently ranks first in the nation for healthcare job growth.
In the past 10 years, jobs in this sector have increased by 78 percent, and research by GNO, Inc. predicts that healthcare will continue to be the top sector for job growth in the region through at least 2026.
This may not come as a surprise if you’ve been paying attention to all the hospital, health center and clinic openings recently, including the $1.1 billion University Medical Center, which opened in 2015, followed only one year later by the $1 billion VA Medical Center in 2016.
In 2017, the growth just continued, especially with Ochsner, Louisiana’s largest not-for-profit health system and the largest employer in the state. Ochsner celebrated more than half a dozen openings of clinics or health centers, including in Gretna, Houma, Slidell, Laplace and Denham Springs.
In June, the healthcare giant opened the Ochsner Baton Rouge Cancer Center, a 20,000-square-foot center that is currently the only cancer program in Baton Rouge utilizing a fully-integrated electronic medical record system.
The center is included in the announcement of Ochsner’s pledged $100 million expansion into the Greater Baton Rouge region, which includes development of a new medical office building, micro-hospital and surgical center along the I-10 Bluebonnet/Siegen Corridor, and the expansion of several new clinics across multiple parishes. Anticipated completion date for the new medical office building, micro-hospital and surgical center is scheduled for 2019.
Additional openings in 2017 have included the following:
In January, The Family Doctors, a division of West Jefferson Medical Center, opened a new primary clinic in Port Sulphur at Plaquemines Medical Center.
In February, Tulane University Medical Group opened Tulane Orthopaedic Spine Center at East Jefferson General Hospital’s campus.
In May, Tulane opened the $1.1 million Professional Athlete Care Team Clinic for former pro athletes as part of the Tulane Institute of Sports Medicine.
In July, Tulane opened Tulane Pediatric Inflammatory Bowel Disease Center at Tulane Lake-side Hospital for Women and Children in Metairie.
In August, CrescentCare broke ground on a $23 million comprehensive health center on Elysian Fields Ave. in New Orleans.
Finally, in September, New Orleans East Hospital opened the New Orleans East Clinic, Tulane opened its newly renovated $3.8 million Bone Marrow Transplant (BMT) program and Children’s Hospital opened its Children’s Pediatrics clinic in Laplace.
2 | MSY Continues to Take Off
Airline service is expanding and passenger totals are breaking records.
By Kim Singletary
Louis Armstrong New Orleans International Airport (MSY) was the second-fastest growing airport in the nation (behind Dallas Love Field) from 2006 to 2016 according to the Federal Aviation Administration (FAA).
Passenger totals for 2016 were record breaking — topping 11 million, a 4.4 percent increase over the previous record set in 2015, of over 10 million. MSY now hosts 15 airlines and serves 59 nonstop destinations, including six international, with about 150 daily departures.
The highly anticipated new North Terminal project has been underway since January 2016, but this January, the New Orleans Aviation Board voted to expand the project from 30 to 35 gates.
Calling the terminal “the most transformative project for New Orleans since the Superdome,” Mayor Landrieu has noted the projected $1.7 billion in economic impact from construction of the terminal and $3.2 billion in expected annual economic impact on tourism. The 972,000-square-foot addition is set to open February 2019.
Starting in February, Allegiant Air began nonstop service to New Orleans from Cleveland and Raleigh-Durham. In March, British Airways launched its first flight. The route received such a strong reception that the airline quickly added another day, bringing service to five days a week during peak months.
More than one-third of all flights from MSY are Southwest, which also expanded service. New seasonal departures to Indianapolis and Pittsburgh started once a week in March, and nonstop service to Raleigh-Durham International Airport in North Carolina and John Glenn Columbus International Airport in Ohio began in April.
From May 19 through June 16, Vacation Express expanded its service to Cancun, and May also brought new routes from Spirit Airlines to Baltimore, Cleveland and Orlando.
This fall, Alaska Airlines began nonstop daily service from New Orleans to San Francisco on Sept. 21, and Spirit Airlines expanded its service with nonstop flights from New Orleans to Boston, Newark/New York, Tampa and Minneapolis/St. Paul in November.
Looking into the future, on March 22, 2018, Spirit Airlines has announced it will also begin seasonal flights three times a week to Columbus, Ohio, through Nov. 7, 2018.
Following up on its inaugural service this past summer, Condor Airlines also announced it will again be offering twice-weekly flights on Thursdays and Sundays from May 17, 2018, through Sept. 30, 2018, from New Orleans to Frankfurt International Airport.
3 | Louisiana Coastal Master Plan Allocates $50 Billion
The third installment of the plan to save our coastline passed in June.
By Kim Singletary
Since the 2007 version of the Louisiana Coastal Master Plan, $18 billion has been spent on restoration and coastal protection projects in 20 parishes, 256 miles of levees were improved, and 45 miles of barrier islands and banks were constructed.
That sounds like a lot, but 10 years later, Louisiana’s land loss problem is so bad that both the Louisiana state government and federal government have declared it a national crisis.
Two-thousand and six square miles — that’s how much of Louisiana’s coastline disappeared between 1932 and 2016 according to a study by the U.S. Geological Survey.
“Basically, the problem is an existential threat to not only our coastline, but our culture and way of life,” explained Marty Mayer in the August 2017 issue of Biz New Orleans. President and CEO of Stirling Properties, Mayer also heads a business-led advocacy group called the Coalition for Coastal Resilience and Economy (CCRE) which spent three years working to support the latest version of the master plan.
The 2017 Louisiana Coastal Master Plan passed on June 2. It calls for 124 projects to be created that will build or maintain 800 square miles of land.
The first 15 years of the $50 billion plan will be financed primarily from an $8.7 billion BP oil settlement, plus an additional $100 million a year in anticipated revenues from offshore oil and gas. The two biggest pieces of the plan in terms of cost are $19 billion allocated for structural protection and $18 billion for marsh creation. Another $6 billion will go toward nonstructural risk reduction, $5 billion to sediment diversions and $2 billion to other types of restoration projects.
Besides its work to ensure Louisiana still exists for generations to come, the plan was also praised by Michael Hecht, president and CEO of Greater New Orleans, Inc., for its aid in creating a new industry in the region.
“Due in large part to the implementation of the plan’s projects, the water sector is expected to grow by 22 percent by 2026,” he said in an official statement praising the plan’s passage in June, “providing nearly 36,000 high-paying jobs for the region.”
4 | Riverfront Plans Announced
New Orleans aims to develop the largest contiguous public waterfront in the U.S.
By Kim Roberts
On Oct. 27, Mayor Mitch Landrieu announced that multiple riverfront redevelopment projects are in the works between Spanish Plaza and Crescent Park, which will be developed over the next two to three years. The 3.2-mile stretch of property is projected to become the largest contiguous public waterfront in the country.
“Despite their proximity, many historic neighborhoods and the public have been cut off from the river in areas by floodwalls, railroads and industrial wharves,” Landrieu said, adding, “Since we were founded 300 years ago, the Mississippi River has been our most cherished resource.”
While the plan, for now, calls mostly for open park space along the riverfront, Landrieu isn’t discounting the possibility of turning the riverfront into a revenue generator in the future. A proposal is on the table to create an economic development district that would cover the area, allowing the city to gain additional revenue from any attractions that may be built there in the future.
Projects cited by the Mayor’s Office as part of the overall riverfront redevelopment include $15 million to convert the Esplanade and Gov. Nicholls Street wharves as part of the New Orleans Public Belt Railroad trade. There’s also $37 million for a new ferry terminal at the foot of Canal Street, $6 million in improvements to Woldenberg Riverfront Park and $3 million in renovations to Moonwalk Park, the $400 million redevelopment of the World Trade Center into a Four Seasons hotel and condos and a $7.5 million refurbishment of Spanish Plaza.
Also included in these plans is Crescent Park, which was completed in 2015 at a cost of $31.2 million.
The series of projects will be completed over the next several years, with many not wrapping up until after Landrieu leaves office in May 2018.
5 | Railroad Exchange
Ending years of uncertainty, the New Orleans Public Belt Railroad now lies in the hands of the Port of New Orleans.
By Chris Price
This past September, the City of New Orleans traded the New Orleans Public Belt Railroad to the Port of New Orleans in exchange for the Gov. Nicholls and Esplanade Avenue wharves, prime waterfront real estate just downriver from the French Quarter. The deal ended years of speculation as to whether the city would sell the railroad to a private operator.
With the acquisition of the railroad, it is expected that the port will gain a greater competitive advantage in international trade, many of its 22 tenants will invest and grow their operations, and real estate on the Industrial Canal will see redevelopment.
New Orleans is the only city in the United States with a deep-water port and a north-south and east-west railroad gateway served by all six Class 1 railroads – CSX Transportation, Norfolk Southern Railway, BNSF Railway, Union Pacific Railroad, Canadian National Railway, and Kansas City Southern Railway. The NOPB connects the city to a combined network of more than 132,000 miles of tracks that reaches every major market in North America.
These efficiencies provide port tenants lower shipping rates and faster shipping times due to direct delivery on one railroad line compared to using multiple carriers. In addition, companies can ship goods directly to multiple markets from the Big Easy, lowering costs by preventing shipping, warehousing and distributing from multiple locations across the country.
“With the NOPB and Port NOLA alignment, the port controls a larger portion of the supply chain and can plan future investments and operations synergistically and strategically,” said Port of New Orleans President and CEO Brandy D. Christian. “This increases our logistical competitive advantage globally.”
For the past two years, many port tenants held off on multimillion dollar capital improvements in New Orleans until the railroad’s future was settled.
“With the resolution of the railroad’s ownership, port tenants who rely on the NOPB’s service can invest in New Orleans with confidence,” Christian said. “The NOPB will continue its service to the port, its tenants and as a switching railroad for the six Class I railroads, as it has since its inception.”
New Orleans Mayor Mitch Landrieu called the transfer a “win-win-win” for the city, railroad and the port, and said the move would allow for greater opportunity to facilitate commerce and economic development. The city plans to convert the wharf space into part of Crescent Park, which will stretch from roughly Iberville Street in the French Quarter to Alvar Street in the Bywater.
6 | Proton Therapy Center On Its Way
Promising cancer treatment with fewer side effects, the $100 million Louisiana Proton Therapy Center could be a boon to medical tourism in New Orleans.
By Ashley McLellan
Cutting-edge cancer treatment is coming to Louisiana with the development of a $100 million proton therapy treatment center in New Orleans.
Knoxville Tennessee Provision Healthcare aims to partner with University Medical Center, LCMC and LSU Health Services Center in New Orleans to provide ProNova SC360 Proton Therapy System treatment. Louisiana Governor John Bel Edwards and Provision Healthcare CEO Terry Douglass made the announcement in a press conference this past April.
The Louisiana Proton Therapy Center will provide 60 new jobs,with salaries starting at $100,000, along with an additional 63 indirect jobs. Provision aims to open centers in Knoxville and Orlando, although the total number of proton therapy centers in the U.S. is limited. Nearly 1.7 million Americans are diagnosed with cancer each year. With 340,000 people currently considered good candidates for proton treatment, only 24 treatment centers are available in the U.S.
The center is another step in the city’s focus on medical tourism, bringing patients to the area for premium diagnosis and care, and making New Orleans a destination city for cancer treatment. Both patients and their families will benefit from the city’s availability of hotel rooms, restaurants, attractions and easy access to facilities.
Proton therapy provides a gentler alternative to more well-known cancer treatments, such as radiation, by inundating cancer cells with positively charged energy directly into the tumor, and producing less side effects for the patient.
The new 31,000-square-foot center will be built within the growing University Medical corridor along Canal Street, with its closest proton treatment center competitors located in Shreveport and Houston. After breaking ground in late 2017, the center is slated to be up and ready for patients in late 2019.
7 | Downtown Boom Gets Another Boost
The neighborhood’s renaissance includes the opening of three notable historic renovations this year.
By Ashley McLellan
Downtown New Orleans covers over 1.2 miles of walkable space, is the largest employment center in Louisiana at 62,000 jobs, and with its access to art galleries, museums and sporting events, the demand for hotels and housing has made it the fastest-growing neighborhood in the city.
The Pythian, located at 234 Loyola Avenue, was selected for a 2017 Downtown NOLA Award by the Downtown Development District for its contribution to the neighborhood through its historic renovation. The building, which started as the Pythian Temple community center in 1908, reopened in May after a $44 million renovation by co-developers ERG Enterprises, Crescent City Community Land Trust and Green Coast Enterprises.
Construction is complete on the 69 apartments — 25 dedicated to workforce housing, 38 available at market rates and six penthouse apartments. One- and two-bedroom apartments are currently available for leasing, as well as six penthouses.
The Pythian also includes a community clinic, a physical therapy center through Magnolia Physical Therapy and will soon be adding the much-anticipated Pythian Market, featuring food vendors and dining.
After a more than $33 million renovation, the NOPSI Hotel held its grand opening on July 6. Located at 317 Baronne Street, in the former New Orleans Public Service Inc. building, NOPSI is an upscale boutique hotel with 217 rooms, 14,000 square feet of meeting space and a restaurant called Public Service. The historic, nine-story 1927 building, which will be managed by Salamander Hotels and Resorts, was acquired for $11.6 million by Connecticut-based Building and Land Technology.
The transformation of the former Pickwick Social Club, 1028 Canal Street, is the latest development to be announced in the downtown area. Located directly across from the Saenger Theater, the building was purchased by Hostelling International, USA, with plans for a hostel featuring more than 126 dorm-style shared rooms, 24 private rooms, a café and meeting space. The renovation on the building is set to be complete in fall 2018.
8 | The Short-Term Rental War Rages On
This year's new regulations aim to help police a practice that some say just exacerbates New Orleans' already unaffordable housing market.
By Jessica Rosgaard
New Orleans’ long anticipated short-term-rental zoning ordinance went into effect on April 1 — regulating an activity that, until then, had been technically illegal, but rarely enforced. New Orleans became the first city to enter into an agreement with Airbnb regarding licensing and enforcement of short-term rentals advertised on their platform.
The ordinance allows for three types of short-term rental properties, with different occupancy allowances for each one. An accessory STR is one where the owner lives on the property full-time and rents out a spare bedroom, or, for example, the other side of their double.
If you live on the property, you can run part of it as an STR for 365 nights a year.
For a temporary STR, the owner does not need to be on the premises while a guest rents out the house — but this kind of rental is limited to 90 nights per year. The commercial STR is limited in scope — though unrestricted by the number of units or nights rented, the property has to be in a commercially zoned area.
A website maintained by the city government shows the status of applications for over 6,000 short-term rentals in New Orleans — approved, pending and denied.
The issue has been polarizing in cities around the world — and New Orleans is no different. The explosion of short-term rentals in the city has raised concerns about the availability, and cost, of rental properties for residents at a time when housing affordability is already an issue. The potential income for a property owner running a short-term rental is often more than what could be charged for monthly rent, which drives up rental prices.
Taking properties off the full-time rental market and moving them to the short-term rental market puts a squeeze on the residential housing supply.
While the regulations are meant to bring some order to the chaos and revenue to the city, even the New Orleans City Council admitted that the regulations would likely need to be revised after going into effect — which means we may see more changes to short-term rental policies next year.
9 | Besh Announcement Signals Bigger Problem
In the wake of sexual harassment allegations against John Besh and BRG, the restaurant industry, and companies of all sizes, take stock in their policies.
By Kim Roberts
With all the accolades and accomplishments under the chef hat of John Besh — arguably one of the most widely recognized New Orleans chefs of the past 20 years and someone who frequently focused on his love of family — it came as quite a bombshell when an exposé by Times-Picayune restaurant critic and features writer, Brett Anderson, published Oct. 21, revealed that his company, Besh Restaurant Group (BRG) had been the subject of an eight-month-long investigation that revealed a BRG culture in which sexual harassment flourished. In all, 25 women, nine of whom spoke on the record, contributed to the report, with some of the allegations specifically involving Besh.
The story was published on a Saturday; by Monday Harrah’s New Orleans Casino, home to the second-oldest Besh restaurant, Besh Steak, announced it was terminating its relationship with BRG. On Monday, WYES announced it would no longer air his cooking shows. Besh officially stepped down from BRG later the same day.
One week later, Harrah’s announced the renaming of Besh Steak to BH Steak, a nod to the casino’s founder, William “Bill” Harrah. On Nov. 7, Besh resigned from the advisory board of the Center for Ethics and Culture at the University of Notre Dame.
BRG includes 12 restaurants, a bar and an event space. The company operates three businesses outside New Orleans, with another restaurant under construction in Houston. Although BRG employed approximately 1,200 people, the company hired its first HR director on Oct. 11.
The Besh revelation has since resulted in a renewed focus on the importance of both HR departments and established sexual harassment training programs and disciplinary procedures across all industries.
It also threw a spotlight on the prevalence of the problem specifically within the restaurant industry. A 2015 study by the Restaurant Opportunities Centers United (ROC) reported that 46 percent of male and 60 percent of female and transgender restaurant workers view harassment as “an uncomfortable aspect of work life.”
According to the Bureau of Labor Statistics, the amount of restaurant jobs created in the U.S. since January of this year eclipses health care, construction, manufacturing and government. More than a third of the new jobs in New Orleans since 2010 have been in restaurants.
10 | New Leadership at the Port and WTC
Brandy Christian and Caitlin Cain both assumed their positions in January.
By Ashley McLellan
In January, two top female businesswomen took over the reins of two bastions of trade in New Orleans. Brandy Christian, president and CEO of the Port of New Orleans, and Caitlin Cain, CEO of the World Trade Center, are about to complete one year on the job, with each receiving accolades for their leadership.
Christian took over the Port of New Orleans as one of only 11 female port directors in the U.S., and the first female director in the port’s 120-year history. At the Port of New Orleans, Christian oversees a public agency that employees nearly 300 with more than $60 million in revenue.
In September, the port also acquired the New Orleans Public Belt Railroad.
With her close ties to the cruise ship community, Christian also has eyes on growing the port’s cruise profile. In October, Norwegian Cruise Lines announced it will bring the largest cruise ship of its kind to New Orleans, the Norwegian Breakaway. Additionally, Royal Caribbean Cruise Lines will dock its 2,435-passenger Vision of the Seas starting next December. Last year, the port welcomed more than 1 million passengers, and is on track to match or surpass that number this year.
Caitlin Cain took over as CEO of the World Trade Center with an eye toward embracing and expanding international trade with New Orleans as the hub for a variety of exports.
Cain’s more than 15 years of experience includes serving as regional advocate for the U.S. Small Business Administration Office of Advocacy covering a five-state territory, and director of economic development for the New Orleans Regional Planning Commission. Her expertise in economic development, working with nonprofits and public-private partnerships will amplify the voice of over 1,000 corporate and individual members of the World Trade Center of New Orleans.
Her goal is to combine global policy issues with small business entrepreneurship by guiding the WTC to act as an advocate for local endeavors on an international level. Cain implemented Louisiana International Trade Week in November, which celebrated New Orleans trade culture and recognized leadership at a black-tie award ceremony, and is working to boost involvement with the Louisiana Consular Corps, the Small Business Association, Idea Village and various chamber associations across the area.