McCormack Baron Salazar, KAI Begin Work on New Orleans Neighborhood

Construction has begun on the $172 million project to redevelop the C.J. Peete public housing site in New Orleans, LA. The C.J. Peete HOPE VI Housing Redevelopment project is being developed by Central City Partners (a team made up of St. Louis-based companies McCormack Baron Salazar and KAI Design & Build), in partnership with the Housing Authority of New Orleans (HANO) and the New Orleans Neighborhood Development Collaborative (NONDC), a non-profit organization dedicated to increasing the availability of quality affordable housing in New Orleans’ Central City neighborhood. A groundbreaking ceremony was held on January 7 to mark the start of construction.
 
McCormack Baron Salazar Executive Vice President Vince Bennett said, “Realizing the transformation of the C.J. Peete site in a troubled financial time demonstrates the significance of public private partnerships. The ability of our team to bring in nationally recognized financial partners such as Goldman Sachs and negotiate a complicated leveraged transaction with HANO, state and local funders and navigate numerous tax and regulatory requirements in 60 days was incredible. Moreover, this development will serve as a catalytic spark in the revitalization of the neighborhood and will support families who were displaced by Katrina.  The importance of this development goes beyond bricks and mortar to transform the lives of community and public housing residents.”
 
McCormack Baron Salazar is a nationally recognized urban developer of affordable housing with extensive experience in the creation and management of large-scale, mixed-income communities.  The firm has developed 131 developments for total development costs in excess of $1.9 billion.
 
“We see this as a tremendous opportunity to revitalize a community and to provide much needed mixed-income housing in the heart of New Orleans’ Central City neighborhood,” said KAI Design & Build President Michael Kennedy, Jr.
 
KAI Design & Build, a minority-owned firm, has a broad range of experience in design, construction and development services and has worked on multiple mixed-finance HUD HOPE VI development programs around the country.  KAI is providing architectural, interior, mechanical, electrical and plumbing/fire protection design on the project, in addition to providing overall direction, coordination and management of the engineering consultant team.
 
C.J. Peete is located in Central City New Orleans and is bordered by Louisiana Avenue, South Claiborne Avenue, La Salle Street and Washington Avenue.  C.J. Peete, named after Cleveland Joseph Peete, a graduate of Xavier University who managed the development from 1952 to 1978, was constructed in 1941 and expanded to 1,403 total units in 1955. The Housing Authority of New Orleans demolished more than half of the site, approximately 723 units, in 1997 with plans for revitalization. Only 146 families were still living at the site when Hurricane Katrina struck on August 29, 2005.  These families were all displaced by the Hurricane Katrina emergency, many of them to out of state locations. The vacant buildings that remained following the Katrina disaster were demolished in the spring of 2008. 
 
Plans for the $172 million, 550,000-square-foot redevelopment, designed to replicate the traditional Central City neighborhood, include:

• Construction of 410 garden and townhouse low-income, affordable and market rate units.
• Construction of a 40-unit, three-story apartment building.
• Renovation of an existing administration building and three-story, residential apartment building with 10 units.
• Renovation of an existing community center to house supportive services programs.
• New streets that tie into existing streets.
• A new park at the southern end of the site that preserves several old oak trees.

Richard Baron, chairman and CEO of McCormack Baron Salazar, explained, “We want to create a stable, safe and sustainable mixed-income community which will increase economic and educational opportunities for all of its residents.”
 
Construction on the project has been put on the fast track and is expected to be completed in January 2011. The general contractor on the project is Woodward Design & Build of New Orleans, LA.
 
In addition to the physical development of the site, the development team joined with Urban Strategies, its non-profit partner, to provide and coordinate essential services and programs for former and new residents of the C.J. Peete community. These programs are designed to assist residents in achieving self-sufficiency, and include intensive case management, job training and placement, technology programs, quality child care and schools, access to physical and mental health services, senior programs, and enrichment activities for children and youth.
 
Urban Strategies is also working with the Recovery School District to rebuild and reopen Woodson Middle School as a K-8 school to serve the children of the revitalized community.

“The success of the revitalization effort at C.J. Peete rests on whether life is stable and filled with opportunity for the most vulnerable families. With many partners, Urban Strategies is focused on making stability and opportunity happen,” said Urban Strategies President Sandy Moore.
 
In October 2006, the Housing Authority of New Orleans issued a Request for Qualifications (RFQ) to revitalize the C.J. Peete site. Central City Partners was selected as the development partner through this competitive national application process. The team combines the deep local experience of NONDC with the nation’s leading for-profit developer of economically integrated urban neighborhoods. The experience of this team in partnership with the Housing Authority of New Orleans and support from local, state and federal agencies has been instrumental in bringing the project together. 
 

The C.J. Peete development represents a financial investment of over $170 million. The permanent sources of funds are from the U.S. Department of Housing and Development, the Housing Authority of New Orleans, the Louisiana Office of Community Development, the Louisiana Industrial Development Board, and Goldman Sachs, the purchaser of tax credits awarded by the Louisiana Housing Finance Agency. Additional funding for pre-development and community supportive services and activities was provided by the Annie E. Casey Foundation, the Kresge Foundation, the Greater New Orleans Foundation, the Local Initiatives Support Corporation, Living Cities, and the Ford Foundation.           
 

 

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