By Ariella Cohen
New Orleans CityBusiness
NEW ORLEANS — If good fences make good neighbors, how about a jail?
In New Orleans, this question of coexistence is gaining relevance as apartment hunters begin eying the fruit of a boom in residential construction in the gritty section of Mid-City that surrounds the city’s interwoven complex of jails, courts and police department facilities.
While people have rented and owned homes in the neighborhood surrounding the notorious House of Detention since the days of jazz legend Louis Armstrong, who lived nearby, the area has never until now been known for much beyond housing the criminal sheriff and thousands of Orleans Parish Prison inmates.
Homeowner Rosella Howard, 66, remembers the doubts she had the first time she saw the block of run-down shotguns and jail facilities where she has lived 1995.
“I drove past and said, ‘Lord, I wonder who these raggedy houses are for,’” said Howard, who passed the house on her way to the public auction where she would buy it. “I didn’t know then one of them were for me. “
Two six-story apartment complexes are under construction a block from Howard’s home. Colorful ads proclaiming the area as the next hip place to “Live Work Play” surround the site, one of four mixed-use developments and a handful of single-family homes being constructed in the neighborhood by New York-based Domain Cos.
One block in the other direction is a functioning, barbed-wire-enclosed Orleans Parish jail.
Howard, a retired nursery school teacher who said she once had police kick in her front door in pursuit of an escaped inmate, is not perplexed by either.
“The police replaced my door,” she said, relaxing on her porch. “I’m used to having all that around by now. “
As for the new development, she shrugs at the prospect of new neighbors.
“I don’t know who they fixing them buildings for,” Howard said. “Sitting here, seeing what I see, you can only wonder. “
Howard isn’t the only one wondering. Between Domain and several other investors, including Provident Realty Advisors of Texas and Falstaff Brewery developer David Miller, hundreds of million of dollars have been sunk since Katrina into an area that for decades has invited little more than low-rent motels and bail bond offices to serve the nearby criminal court.
While representative of recent national real estate trends favoring the redevelopment of centrally located urban tracts, the investment remains a risky one, according to talk in real estate circles.
“They are rolling the dice and only time will tell if it the roll will work,” said Zach Fanberg, a partner with Tommy Crane Group, a realty firm with an office on Canal Street.
One sign pointing toward the area’s successful transformation was the sale in May of a two-story house on South Alexander Street, a block and a half from the Interstate 10 overpass, not far from the criminal justice complex. Domain Cos. bought the house last year for $60,000. After a renovation, the company sold the house for $222,500, a 270 percent increase in value.
“There is no other part of town that has seen this kind of significant investment since Katrina and the prices are reflecting that,” Fanberg said.
But the prices are also reflecting the proximity to the grit of the criminal justice complex, and that, too, seems to be working in the development’s favor. The residential development in the Tulane Avenue corridor is being funded in part with tax credits awarded in exchange for guarantees that some or all the housing being created will be rented at affordable rates, typically in the $600 to $1,000 range for a two-bedroom unit depending on the subsidy.
The relatively low rents are expected to pique interest among a broad range of potential tenants including students at nearby Xavier University, police officers who work even closer and young people typically priced out of downtown.
“The jail guarantees slower gentrification,” said Dan Causgrove, 29, a chef at La Petite Grocery who moved to New Orleans from New York at the beginning of the year. “I can have a cool loft without the price being driven up by professionals who are less intrepid. “
Domain principal Matt Schwartz said he also sees the silver lining in the nearby prison. The developer, who has already begun leasing retail and restaurant space within the developments, said he has been pleasantly surprised by the amount of interest in the area.
“The (criminal justice) facilities are really tucked away, not visible to the street, but there are people who working there everyday,” Schwartz said. “Those people will bring businesses to the area. “
From a practical standpoint, the jail complex could prove to be a smaller disturbance to future residents then the highway overpass that overlooks the new development and the train tracks behind it, said New Orleans folklorist and Tulane University urban studies professor Nick Spitzer.
“Highways, railroads and the constant interruption of traffic make a domestic landscape hard and could be a bigger deal to (residents) than the jail,” Spitzer said.
One benefit universally agreed upon is the proximity to police, a force often in short supply in New Orleans.
Howard said she already knows how it feels to be so close to the nerve center of the city’s crimefighters. Once she accidentally dialed 911 while trying to call her daughter in Mississippi. Within minutes, police were knocking on her door.
“It’s close by,” Howard said. “They was here in a jiffy. "
Copyright 2008 Dolan Media Newswires