Good News in New Orleans
By Margaret Foster | Online Only | Oct. 15, 2008
A New Orleans department store, opened in 1903 but vacant for the past 11 years, has become the first luxury condominium project to open in the city since Hurricane Katrina struck in 2005.
The historic four-story Krauss Building, reborn as 1201 Canal Condominiums, now contains 122 apartments above ground-floor retail space. Developer KFK Group also built a 111-unit condo tower behind the historic building, and so far, about 80 percent of those condos have been sold.
"This is one of the first projects that will bring back residential living on this [street], and I am so excited," said Mayor Ray Nagin at the Sept. 19 opening event. "[The developer] tried to get me to buy one, but I had to tell him I was living on a government check and so I couldn't afford it."
When Hurricane Katrina hit the Gulf Coast, and floodwaters surged through New Orleans' failing levees, KFK put the project on hold—but only temporarily.
"We signed the contract the Friday before Katrina, and we planned on starting construction on Tuesday, once the storm blew over," said Elie Khoury, KFK principal. "About 14 months later, we got our act together."
Katrina upped construction costs by $10 million, says KFK's David Garcia, vice president of development, so the developer secured historic tax credits to offset that financial blow.
"The historic tax credits we used on the [Krauss] building roughly balanced that increase," Garcia says. "We're subsidizing the cost [of condos] with the historic tax credits, so our pricing is a great value."
Residents hope Khoury's success will inspire other developers.
"It's a terrific project," says New Orleans lawyer Camille Strachan, a trustee emeritus of the National Trust for Historic Preservation. "It's important not only because it brings vitality to that part of Canal Street, but it illustrates that these buildings, like a number of others on Canal Street, can be reused."
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