Week in Review, Sept. 7-11: N.O. Business Leaders Hope for Big Gains
NEW ORLEANS – As the Saints prepared to play the Tom Brady-led Buccaneers in a mostly empty Superdome, Gov. Edwards announced the state will move to ‘Phase 3’ of its pandemic restrictions and the New Orleans business community continued to game plan an economic recovery. Here are the week’s highlights compiled from staff and wire reports:
Deals and Debuts
Dobbins Group LLC, a national multi-family real estate investment firm, along with general contractor Capstone Building Corp. announced the completion of a $43 million luxury apartment development, The Collins, in Covington. The developers said The Collins is an upscale 346,539-square-foot, 272-unit, apartment community that offers two-story apartment homes with ground-floor private entries, a direct-entry garage, and a private patio or balcony.
Louisiana Gov. John Bel Edwards announced a California-based manufacturer will invest $5.1 million to build a new facility in Lafayette and create nearly 70 new jobs for the state. The investment will come from Westfield Hydraulics’ affiliate company, Westfield Fluid Controls, according to a statement from the Louisiana Department of Economic Development. The company, which makes hydraulic and fluid control components for aerospace and defense applications, is relocating an existing operation from San Fernando, California, to Louisiana.
HUB International Limited, a global insurance brokerage, announced that it has acquired the assets of Hollis Companies LLC and the Employee Benefits Corporation. Located in Metairie, the companies provide benefits solutions, workplace-wellness plans and guidance on compliance issues to clients. “Hollis Companies and TEBC are great additions to HUB. They create even greater potential in the markets we serve,” said a rep.
After months of closure due to Covid-19, the team at Commander’s Palace, arguably New Orleans’ most iconic restaurant, said it is eager to get back to “serving friends, family and the community.” Doors reopen Friday, Sept. 11. A rep for the Louisiana Creole restaurant said it is “taking every precaution and ensuring we are staying safe and healthy. The dining rooms will look different with more space in between the tables, masks will be required and worn by employees. Dinner will be served seven nights a week starting at 6 p.m. and jazz brunch will continue on weekends.” Boucherie in the Carrollton neighborhood also announced a reopening.
First the Bad News …
Hotel job losses in Louisiana will number 54,182 this year, out of a total of 120,404 hotel jobs in the state, according to projections by the American Hotel & Lodging Association. Hotel job losses and employee furloughs are unprecedented and increasing by the week, the AHLA reported. The industry supports about 8.3 million jobs nationwide, either directly or indirectly, according to the association. 2020 is expected to be the worst year on record for the hotel industry, with eight in 10 hotel rooms remaining empty during the coronavirus pandemic and an overall 50 percent drop in revenues for hotel operators, the analysis says.
… then the Good News
Consumers in the Gulf South are more ready for things to open than they have been just weeks ago. Extreme concern over the coronavirus pandemic in the U.S. has dropped 5 points since July to just 37.5%, according to updated Gulf South Index research, conducted September 6-9. “The first of September looks like a launching pad for moving to the next phase of reopening our communities,” said Marc Ehrhardt, president and partner of the Ehrhardt Group. “Across the Gulf South, public and private schools reopened in the second half of August. Pre-COVID-19 routines emerged, along with greater feelings of normalcy. As we saw in July, there is building consumer demand for experiences we may have taken for granted when 2020 began, like eating out with family and friends. In early September, this demand is ready to turn into action.”
The National Federation of Independent Businesses said its Optimism Index increased 1.4 points in August to 100.2, a reading slightly above the historical 46-year average. Seven of the 10 Index components improved, two declined, and one was unchanged. The NFIB Uncertainty Index increased two points in August to 90, the second-highest reading since 2017. “Small businesses are working hard to recover from the state shutdowns and effects of COVID-19,” said a NFIB rep. “We are seeing areas of improvement in the small business economy, as job openings and plans to hire are increasing, but many small businesses are still struggling and are uncertain about what the future will hold.”
And U.S. consumer borrowing rose by a solid 3.6% in July, the second monthly gain after the coronavrius pandemic had sent consumer borrowing down sharply in the previous three months. The Federal Reserve reported Tuesday that the 3.6% increase in July, which represented a $12.2 billion advance, followed a 3.3% rise in June and sharp declines in March, April and May. The strength in July came from a $12.5 billion rise in the category that includes auto loans and student loans. The category that covers credit cards fell by $293 million, the fifth straight month that the credit card category has declined. Consumer borrowing is closely watched for signals it can send about consumers’ willingness to take on more debt to support their spending. Consumer spending accounts for 70% of U.S. economic activity.
… and a Silver Lining
Amid all the pandemic struggles, the University of New Orleans said it has increased its overall enrollment by nearly 2%, marking the first time in 15 years that the University has grown enrollment in three consecutive years. Fall 2020 enrollment is 8,375 students, uplifted by a 20% increase in new freshmen students, a 21% increase in new graduate students and significant growth in the number of local and African American first-time freshmen.“These figures are proof of our continued momentum as a university community,” said UNO President John Nicklow. “I am so proud of our admissions teams and all of our faculty and staff for their focus on student success. They have also worked hard to eliminate barriers that might prevent students from accessing a quality UNO education.”