The Oldest Skyscraper in New Orleans
5 January 2010
Woodward Design+Build is currently performing the historic conversion of The Maritime Building into luxury apartments.
Maritime building being converted into apartments, offices, shops
23 December 2009
Construction is under way to convert New Orleans’ oldest skyscraper, the Maritime building, into apartments, offices and retail space after an unusual financing package that had been in the works for three years finally came together this fall.
Architect and developer Marcel Wisznia is turning the eleven-story 1893 building at Carondelet and Common streets in the Central Business District into 105 market-rate apartments, with retail on the ground floor and offices on the second floor.
“This just did not just happen at the last minute. We’ve been working on it for three years,” Wisznia said.
In making the $38.9 million project a reality, he used a combination of federal and state historic tax credits and new markets tax credits with Federal Housing Administration-backed financing. To bring all of these components together, Wisznia had to do a special “two-tiered” lease that required a change in program rules at the U.S. Department of Housing and Urban Development.
HUD said the Maritime was the first project nationwide to go through a special pilot program to give developers more flexibility when using FHA-guaranteed loans in concert with different tax credit finance programs. Developers in other cities are now using the blueprint.
While the Maritime project was not delayed by last year’s financial meltdown, the project did have to shift gears when its original lender, Wachovia, was swallowed up in the banking crisis. The Texas office of Minnesota company Dougherty Mortgage LLC completed the deal.
John Sibal, president and chief executive of Eustis Commercial Mortgage, said that apartments are about the only type of commercial projects moving forward right now because of HUD’s involvement.
Regular commercial deals such as office buildings, shopping centers, hotel conversions and industrial sites aren’t moving forward because lenders are concerned about deflating real estate values affecting their portfolios and uncertainty surrounding the $1.5 trillion in commercial real estate debt that is expected to become due in the next few years. “It really has slowed down tremendously,” Sibal said.
The Maritime building, vacated after Hurricane Katrina when Latter & Blum Realtors Inc. moved to the Warehouse District, has already gone through major transformations in its 116-year history.
In 1920, when Canal Bank & Trust Co. wanted to move into what had become the heart of the city’s banking sector, the previously symmetrical building was extended along Carondelet Street to make more room for the vaults. The second floor was modified to create elegant, arched windows befitting a bank lobby, and an observatory on top of the building that overlooked the river was enclosed to create an 11th floor. All the window bays on Carondelet have views of Bourbon Street because of the curve in the road.
A fire escape added to the U-shaped building to meet safety codes was used in a scene of the action movie “12 Rounds,” which was released earlier this year.
Hancock Bank now occupies a large section of the ground floor, and Wisznia’s team plans to restore the rest to its original use as small retail and restaurant spaces. Upper floors are being converted into one- and two-bedroom apartments. The eleventh floor will have a party space and gym, and a portion of the top floor will be opened up as an outdoor room with an endless swim pool.
Carl E. Woodward LLC is the general contractor on the building, which is expected to be completed in September or October 2010.
While many in the city are becoming concerned about an oversupply of market-rate apartments, Wisznia said he doesn’t believe that’s a problem downtown because many apartments have been converted into condominiums as their historic tax credit obligations have been fulfilled.
Using the same sort of financing mechanism, Wisznia has also received financing commitments to redevelop the 1956 Saratoga building at 212 Loyola Ave. into apartments, a $41.8 million project. Located in the shadow of the city’s medical district, the Saratoga’s 155 apartments will be marketed to doctors, hospital workers and medical students.
The Saratoga deal is expected to close early in the new year, and construction will begin soon afterward.