Gulf Coast Resurgence

Ten years ago Hurricane Katrina and its subsequent flooding devastated the Gulf Coast.

More than 1 million housing units in the Gulf Coast region were damaged when the hurricane struck in August 2005. About half of the damaged units were located in Louisiana, with 70% of all occupied units in New Orleans suffering damage.

The catastrophic storm also contributed to more than 1,800 deaths, the displacement of more than 1 million people, and $135 billion in total damages.

Over the past decade since the storm, significant revitalization has taken place in New Orleans and throughout Louisiana and Mississippi, providing needed mixed-income housing for the region.

For the 10^th anniversary of Hurricane Katrina, Affordable Housing Finance is highlighting 10 developments, including the redevelopment of the “Big Four” public housing projects in New Orleans, that have left their marks on the revitalization of the Gulf Coast.

One of the biggest success stories has been the efforts to reduce New Orleans’ homeless numbers, which swelled to more than 11,500 in the years after Katrina because of the lack of housing stock and jobs.

As of January 2014, the number of people experiencing homelessness on any given night had decreased to under 2,000 individuals, slightly lower than pre-Katrina. And in January 2015, New Orleans announced that the city had ended veterans homelessness.

One organization that has played a critical role in these efforts is nonprofit UNITY of Greater New Orleans, a consortium of over 60 agencies providing housing and services to people who are homeless or at risk of homelessness.

After Hurricane Katrina, UNITY began its permanent supportive housing initiative to house some of the city’s most fragile homeless people. The nonprofit partnered with Community Solutions, an organization launched and led by industry veteran Rosanne Haggerty to help communities solve the problems that create and sustain homelessness, and local developer HRI Properties.

“We’ve been really pleased with what we have been able to accomplish,” says Martha Kegel, executive director of UNITY. “With our permanent supportive housing initiative and tenant-based work, we have been able to make a big dent. We are within striking distance to end chronic homelessness and family homelessness.”

The partnership focused on three key elements: the blending of formerly homeless with others who had never experienced homelessness, which was based on the model Common Ground, the nonprofit organization that Haggerty founded, uses in its New York City supportive housing; the commitment to high-quality materials and design; and an emphasis on saving historic buildings.

Their first development, the Rosa F. Keller Building on Tulane Avenue in the Mid-City neighborhood, was completed in April 2012 and became the city’s first mixed-income permanent supportive housing apartment project.

The $16.8 million redevelopment, which was named after civil rights activist Rosa Freeman Keller, includes 60 units—30 for low-wage households and 30 for chronically homeless—a case management team, a landscaped courtyard, and a fitness room. It also is conveniently located across from the new Veterans Affairs Medical Center and University Medical Center.

“It’s an outstanding development that has made a huge impact on the community,” says David Abbenante, president of HRI subsidiary HRI Management. “It’s a model for the rest of the country.”

The team also was responsible for the Dr. Everett and Melva Williams Building in Central City, completed in 2013, which includes 21 units for chronically homeless individuals and 21 units for low-income households.

A third project by UNITY, the 109-unit Sacred Heart Apartments, is still under construction. However, it has played a big role in helping the city end veterans homelessness. When the first building was completed, it received a temporary certificate of occupancy in December 2014 and immediately moved in 11 veterans. As of mid-July, 50 veterans had moved into the development.

Here’s a look at nine other developments that have had an impact on the region.

Bay Waveland Housing Authority Rebuilding Initiative

Bay St. Louis and Waveland on Mississippi’s Gulf Coast, ground zero for Hurricane Katrina’s landfall, were devastated by wind and storm surge.

Both cities’ housing authorities lost their public housing stock, and the communities were facing financial difficulties after the storm. In 2006, the Department of Housing and Urban Development (HUD) decided to consolidate the two into the Bay Waveland Housing Authority.

Five years after the storm, the merged housing authority celebrated the opening of Oak Haven Apartments, a $10.5 million, 80-unit development for seniors in Waveland.

Almost a year later, it opened Bay Pines Apartments, 100 units of family housing in Bay St. Louis. The $18.9 million development includes one-, two-, three-, and four-bedroom units.

“We think we’ve enhanced the neighborhood by providing units that blend in with the image of a coastal community that our city projects, while also providing safe and sanitary housing according to HUD guidelines,” says Janine Lee, executive director of the housing authority. “Since start of occupancy, we’ve had about 50% of the former residents come back.”

Both developments have been 100% occupied since opening with waiting lists. “We have exceeded our expectations of both developments,” she adds.

The housing authority closed on financing at the end of July and planned to start construction at the beginning of August on the rebuilding of Camille Court, which was built in Waveland the 1970s after the devastation of Hurricane Camille. It will provide 30 two- and three-bedroom family units. It also hopes to build a 24-unit seniors project in Bay St. Louis in the future.

Biloxi HOPE VI Redevelopment

At the time of Hurricane Katrina, the HOPE VI development in Biloxi, Miss., was about 30 days away from initial completion.

“It was 90% complete, and we had people living there already,” says Bobby Hensley, executive director of the Biloxi Housing Authority. “The weekend Katrina hit we had another 15 or so apartments scheduled to be moved into.”

The work that had been done was completely destroyed. The seniors building had just been framed out. After the storm, only the slab remained. On the completed buildings, water rose as high as the ceilings on the first floor. Residents were moved out, and the construction process had to start over.

Hensley says some components, such as the community building, had to be scrapped the second time around. With money from the insurance companies, the state and federal governments, and the housing authority, the team managed to put the $60 million deal back together.

In 2007, Cadet Point, the 76-unit seniors building, was completed. “We were the first new housing to open up after the storm on the peninsula area of the city,” says Hensley.

Following that came the 196-unit Bayview Place, which includes public housing and low-income housing tax credit units, and Bayview Oaks, 39 for-sale homes. Unfortunately, because insurance became so costly for homeowners after Katrina, only about half of the homes sold. The rest were turned into rentals.

In addition to the HOPE VI redevelopment, the housing authority, which lost approximately 80% of its public housing stock, continues to grow to meet the need. At the time of Katrina, the housing authority was serving approximately 600 families. Today, it serves around 1,800.

According to Hensley, since Biloxi is an older city, many people had been living in homes older generations had built and didn’t have the resources to rebuild or pay the costly insurance. “So they found themselves in need of affordable housing,” he says. “We have expanded and tried to meet that need.”

Centennial Place and Fresh Food Factor

In New Orleans’ Warehouse District near the Port of Orleans, Renaissance Neighborhood Development Corp.’s (RNDC) redevelopment of two historic buildings along the banks of the Mississippi has exceeded expectations.

RNDC, a collaboration between Volunteers of America and Volunteers of America Greater New Orleans formed in 2006, converted the former Lykes Steamship factory into 52 moderate-income apartments; half of the units are for households earning no more than 80% of the area median income, and the other half are market rate.

“We’ve got a good mix of residents ranging from people who work in the hospitality industry downtown, a couple of first responders, some seniors, some students, and some people who work in the port,” says Victor Smeltz, executive director of RNDC. “It’s a really great cross-section of working families.”

The neighboring Centennial Cotton Press building is now home to the Fresh Food Factor, which is a growing social impact enterprise that serves as a healthy food-service provider for area schools and a job creator.

The program, which got off the ground in May 2013 with a few school lunch projects, served over 277,000 meals in fiscal year 2014. In fiscal year 2015, that number almost tripled to 737,730 meals at four schools, three Head Start programs, and 14 summer camps.

This year, Fresh Food Factor has secured contracts covering five new schools. Approximately 1.4 million healthy meals are expected to be served for fiscal year 2016, with 46 full-time and part-time employees.

“It’s exciting to see the program expanding,” says Smeltz. “The schools have really responded to the quality of these meals and the fresh and healthy approach.”

To aid Fresh Food Factor’s growth, Enterprise Community Partners and UnitedHealthcare recently provided funding for additional equipment for the proram’s state-of-the-art kitchen.

The $19 million redevelopment was financed with New Markets Tax Credits.

Columbia Parc at the Bayou District

Hurricane Katrina took a toll on the already distressed St. Bernard public housing development. Almost a year after the storm, HUD announced that New Orleans’ notorious “Big Four” public housing projects, including St. Bernard, would be redeveloped as mixed-income developments.

The Bayou District Foundation and Atlanta-based Columbia Residential partnered with the Housing Authority of New Orleans (HANO) to transform the 52-acre site in the Gentilly neighborhood.

Between 2010 and 2013, 685 mixed-income units for families and seniors, including 229 for public housing residents, came online in the four-phase, $156 million residential component.

“I think it’s been a massive success on the housing side,” says J.T. Hannan, director of public and governmental affairs for the Bayou District Foundation. “Every unit has been leased with a waiting list since we opened.”

There’s also a focus on education. “We are trying to build a cradle to college education pipeline within and adjacent to Columbia Parc,” says Hannan.

The first component of that is Educare New Orleans, an early education facility that prepares children for kindergarten that opened in October 2013.

To create the Educare facility, which sits in the heart of the neighborhood, the development team preserved three of the 1940s public housing buildings and constructed three new buildings.

“The Educare is the most remarkable piece of the whole site,” says Jim Grauley, principal at Columbia Residential. “It makes the neighborhood so much more vibrant. Literally a child can grow up there and have a top-notch education a few sidewalks distance from their home.”

The development team is in negotiations to build a K-8 school, and a new high school is opening across the street from the development this fall.

New city streets, three playgrounds, a pool, three business centers, two movie theaters, and a community garden also have been installed, but more development is in the works, such as a permanent health clinic and additional recreational facilities.

“It’s 10 years past Katrina, and we’re within a few years of the completion of our vision of a comprehensive mixed-use, mixed-income community,” says Grauley.

Faubourg Lafitte

For Enterprise Community Partners and Providence Community Housing, there were two key conditions for redeveloping the Lafitte public housing project: one-for-one replacement for the public housing units, which was not required by HUD when it announced that the “Big Four” would be transformed into mixed-income communities; and to track down as many of the former residents to give them priority for the new housing.

To replace all 900 subsidized units and create a mixed-income community, it meant the development team would need to construct 1,500 total units on the former Lafitte site in New Orleans’ Treme neighborhood and on scattered sites in the surrounding community.

Enterprise and Providence, who partnered with the L+M Development Partners and HANO, had to overcome deadline challenges and the Great Recession, but funding is now in place for the first large phase of 812 units. At press time, 584 units had been completed, 106 were under construction, and 122 were in predevelopment. The first residents moved into completed homes in January 2011. The remainder of the units will be completed in future phases.

“We expected we would be a lot further. We thought we would have been where we are now five years ago,” says Michelle Whetten, Gulf Coast vice president for Enterprise. “But it has taken three or four years longer than we or anyone would have expected.”

As for the former residents, Whetten says at the time of the storm 865 units had been occupied. The community organizing nonprofit the team hired tracked down about 550 residents scattered in 37 states. Those residents were apprised of the redevelopment plans through monthly newsletters and were offered social services through Catholic Charities.

A conscious effort also was made to involve former residents in the design process. Architects did planning sessions with the residents in Baton Rouge, La.; Houston; and New Orleans.

“The results have exceeded our expectations for return of residents,” says Whetten. “About half of the residents of the new housing were residents of the former Lafitte development, which is higher than the typical return rate. And we are pretty pleased with what ultimately got built, and it is a very close reflection of what residents said they wanted to live in.”

Harmony Oaks

Another “Big Four” public housing development, C.J. Peete, underwent a major transformation in the years after Katrina.

National developer McCormack Baron Salazar (MBS) partnered with Landwide Development and New Orleans Neighborhood Development Collaborative, now known as Harmony Neighborhood Development, to redevelop the Central City site into mixed-income housing.

The $172 million Harmony Oaks created 466 units of low-income, workforce, and market-rate housing, including 193 units set aside for public housing residents; reintroduced the street grid to reconnect the residents to the surrounding community; renovated an existing community center to house supportive-service programs; created a new park that preserves several oak trees, a community pool, and retail.

“It has accomplished what everyone has hoped for. We wanted to make sure that we were providing enough units for those 144 families living there at the time of the storm,” says Yusef Freeman, a vice president at MBS. “Every residential building has one market-rate, one public housing, and one affordable unit. We were really happy that we could create true economic integration.”

Seventy-one former residents returned to Harmony Oaks, with six of the former public housing families moving into market-rate units and four moving into tax credit units.

Urban Strategies, MBS’ nonprofit affiliate, provides supportive services for former and new residents.

MBS continues to remain active in New Orleans on the redevelopment of the final “Big Four” public housing development B.W. Cooper, renamed Marrero Commons, with Columbus, Ohio-based KBK Enterprises, B.W. Cooper Resident Management Corp., and HANO. The developer also is a key partner in the city’s Iberville Choice Neighborhoods Initiative.

HomePort I and II

While Back Bay Mission, a Biloxi, Miss.–based community ministry of the United Church of Christ founded in 1922, has been doing homeownership rehabs for low-income households since after Hurricane Camille in 1969, it created a nonprofit subsidiary—Gulf Coast Housing Initiative—in 2007 to provide additional affordable housing opportunities.

One of the highlights for the Gulf Coast Housing Initiative has been the creation of the first permanent supportive housing for veterans in southern Mississippi.

Phase one of its HomePort project was comprised of a duplex for disabled, homeless veterans.

“We actually would have done eight or 10 units, but the financing was a key part of that,” says Everett Lewis, associate for Back Bay’s housing initiatives. “Rather than not do anything, we pursued funding for the duplex.”

The $158,000 first phase, completed in 2012, was financed through HOME and Supportive Housing Program dollars from HUD and the Harris County Consortium.

The second phase, which was completed in February and contains six units, was more challenging. The team raised almost $50,000 from private donations from local businesses and congregations around the country for the $532,000 development. Additional financing included HOME funds, a Home Depot Foundation grant, and a Federal Home Loan Bank of Dallas grant.

All of the units are furnished, and no security deposit is required. Residents also receive HUD-Veterans Affairs Supportive Housing vouchers so they pay no more than 30% of their income for rent.

“We designed this so that the veterans could literally leave the streets or the woods and move right into these units,” says Lewis. “We just didn’t want to put any obstacles in front of the veterans to prevent them from being housed.”

Iberville Redevelopment

HANO and the city received a $30.5 million Choice Neighborhoods Initiative grant in 2011 from HUD to redevelop Iberville, the last standing conventional public housing development in the city, and the surrounding Iberville-Treme community. More than 2,400 mixed-income units are planned, including one-for-one replacement of the 821 public housing units, on site and off site.

More than 300 blocks are estimated to be revitalized, with a price tag of approximately $600 million for the full plan, according to HANO.

“HANO and the city saw this part of downtown poised for revival and revitalization,” says Josh Collen, vice president of development for local developer HRI Properties, which is a key partner on the initiative.

To develop the Iberville site in the 1940s, Collen says the street grid was removed from the 23-acre portion of the city and an inward-looking development was created, becoming isolated and suffering from concentrated poverty. One of the first items the stakeholder group agreed on was to reintegrate the street grid, creating 10 new city blocks.

The housing on nine of the 10 city blocks has been financed and is under way, with all infrastructure to be completed by the end of the year.

Sixteen of the historic buildings on the site are being retained and restored. “These are three-story brick walk-ups with beautiful iron work—lovely buildings from the 1940s,” says Collen. “They had fallen into disrepair, but the structures are historic gems.”

The remainder of the on-site housing is a mix of new construction building types, such as townhouses and four-story multifamily buildings.

The first two phases of housing on the site, 227 units in a mix of renovated historic buildings and new construction, celebrated its grand opening Aug. 28. The third phase, another 105 apartments, is 40% complete.

One of HRI’s first off-site phases was the renovation of the historic Texaco Building into the 112-unit Marais Apartments for seniors 62 and older. The $35 million renovation was completed in May 2014.

“The renovation scope had to meet National Park Service standards. It needed to look like 1950 and needed to meet 2014 energy and green requirements as well as the current building code requirements,” says Collen. “The result is beautiful from the outside. Inside there are brand-new window views from the 17-story building. The seniors have an amazing place to live.”

The Muses

The Muses, a mixed-income project in New Orleans’ Central City, has not only contributed 103 affordable and 160 market-rate units to the housing stock, but it also has spurred development activity throughout the neighborhood, which suffered from disinvestment before and after Katrina.

“The Muses kicked off all the development work. It has caused tremendous spillover investment,” says Kathy Laborde, president of Gulf Coast Housing Partnership (GCHP), the developer and owner behind the project. “The result has been a lot more private investment in both residential and commercial areas in the surrounding neighborhood.”

GCHP partnered with Louisville, Ky.–based LDG Development and local Jericho Road Episcopal Housing Initiative to build the $60 million project, which was completed in 2010, on more than four acres of vacant land.

The project’s success led GCHP to do a second project deeper in the Central City neighborhood. The King Rampart Apartments, which is adjoined to the mixed-use Harrell Building that houses the offices of the New Orleans Redevelopment Authority, includes 70 units of affordable rental housing for households 55 and older.

“Those developments, I believe, gave the market confidence that this was a good neighborhood in which to invest,” says Laborde. “And that is the point of what we do. It’s to help the folks in the neighborhood and to demonstrate to the folks not in the neighborhood why we should invest here.”

GCHP, which launched in January 2006 to address rebuilding efforts after hurricanes Katrina and Rita, has done additional neighborhood redevelopment, including a performing arts center, office buildings, and condos. It is currently working on a renovation of a homeless shelter in the neighborhood.