Original Texaco Building on Canal Street renovation financing approved

Posted on: January 23 2012

Retail will be placed on the street level and the rest will be housing for the elderly.

Sunday, January 22, 2012

By Ed Anderson, The Times-Picayune The Times-Picayune

New life might soon be coming to a tired, dilapidated Canal Street building. The State Bond Commission has approved the issuance of up to $22 million in bonds to retool the dilapidated Texaco Building at 1501 Canal St. into housing for older people.

The renovations are expected to begin in April and take about 15 months to complete, said Joshua Collen, vice president of development of HRI Properties, the firm handling the renovation.

The bond issue will cover about two-thirds of the $33.2 million cost of the project, which will also receive federal and state historic tax credits and loans.

The 17-story building, constructed in the early 1950s, is listed on the National Register of Historic Places, symbolic of the style of architecture that was used on commercial structures 60 years ago.

Although some modifications have been made to the building over the years, the renovation will "restore it to its original state," Collen said.

Because the building has been vacant for at least 15 years, he said, it is leaky and "in deplorable condition." The oil company moved out of the Canal Street building years ago in favor of a new office complex in the Poydras Street area.

The bond issue originally was approved 11 months ago, but ownership of the structure changed, and a nearly identical redevelopment plan has been submitted, necessitating the second round of approvals, according to an analysis by Bond Commission staffer Jessyka Aizprua said.

Collen said about 4,500 square feet of the building along Canal Street will be used for retail. In addition to the 112 units, the development also would have a community room fronting on Marais Street, a fitness room, a garden terrace and a beauty salon.

The units will primarily accommodate low-income senior citizens, especially those who might be moved by the retooling of the nearby Iberville Housing Development.

Aizprua's analysis said the project is expected to employ about 175 temporary construction workers during the renovation.

The project caught some flak from commission members who complained that the cost to renovate and build out the 112 units averaged about $297,000 each.

Rep. Jim Fannin, D-Jonesboro, said for that price, the bonds could be used to build individual homes in New Orleans for the tenants. He said another housing proposal before the commission would cost about $92,000 per unit.

"That seems to be a significant increase" for the Texaco units, Rep. Cameron Henry, R-Jefferson, said.

Collen said more work has to be done to improve the structure than some other properties seeking bond commission authorization.
texaco_building_1950s.jpgView full sizeThe 17-story Texaco Building, constructed in the early 1950s, is listed on the National Register of Historic Places.

The Texaco building project was approved even though the commission passed a resolution several months ago placing a moratorium on bond issues involving construction of new housing in New Orleans that is financed with federal block grant money or recovery dollars.

Commission Director Whit Kling said the panel has heard -- and approved -- two other housing requests at the behest of New Orleans officials, like the mayor.

Kling said the rule remains in place pending hearing from officials of the newly created Louisiana Housing Corp., which is expected to verify the need of additional residential and rental units in Orleans Parish and other areas.

"There were some questions raised about New Orleans becoming overbuilt" with housing, state Treasurer John Kennedy told new panel members. Kennedy is chairman of the commission.

Kling said the approval of the Canal Street project was only the third exception made to the general moratorium.
texaco_building_horizontal.jpgView full sizeKathy Anderson, The Times-PicayuneRenovating the Texaco Building is expected to cost $33.2 million.

Gov. Bobby Jindal's chief fiscal adviser, Commissioner of Administration Paul Rainwater, urged the panel to approve the Canal Street project..

"We have always supported this as seniors housing," Rainwater said. "This particular project will not have an impact on the overall (housing) marketplace."

Rainwater said Mayor Mitch Landrieu supports that project and that the development needs to be done. "This project has been delayed quite some time," he said.