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Hurricane Katrina rebuilding hurdles illustrated

July 22, 2012
By REBECCA MOWBRAY , The Times-Picayune

NEW ORLEANS, La. - After Hurricane Katrina, neighbors dreamed of the modest Lake Terrace Center strip mall at 1532 Robert E. Lee Blvd. blossoming into a town center, becoming a focal point for their rebuilding efforts and a brighter future. Their vision was enshrined as one of former recovery czar Ed Blakely's 17 target recovery zones, but seven years after the storm, the Lake Terrace Center remains gutted and fenced with no signs of progress. On June 7, the property was cited at a blight hearing and given 60 days to make improvements.

Ken Charity, managing director of DMK Acquisitions and Properties LLC, which bought the shopping center in spring 2007, said he addressed the blight citation by getting a building permit on June 21. As soon as low-interest loans come through from programs at the city and state, Charity said he's ready to go. He believes those approvals are right around the corner, and construction could begin in 45 days.

"We're moving forward to develop," Charity said. "We have everything that we need."

Article Photos

In this June 26, photo, Lake Terrace Shopping Center at 1532 Robert E. Lee Blvd. in New Orleans, was cited for blight earlier in June 2012. It has remained vacant since Hurricane Katrina in 2005.

But neighbors are fed up, and they say it's the same old story of Charity being unmotivated to develop the property. "He took ownership of the property, and nothing has happened since 2007," said Dalton Savwoir, president of the Gentilly Civic Improvement Association, which represents about 20 neighborhood associations. "You certainly can't buy a piece of property and expect someone else to finance it for you."

Exactly why the shopping center has failed to be redeveloped is a matter of perspective, but the Lake Terrace Center illustrates how public rebuilding money doesn't always perform as expected, and redevelopment projects can fall through the cracks without someone to oversee how all the moving parts fit together.

Billy Fields, a former University of New Orleans urban planning professor who studied Lake Terrace and worked on a public-private partnership plan for the area, said that Blakely's target recovery zones were an excellent idea, but the lesson for the city is that someone needed to be in charge of each one to coordinate all the departments that have a hand in rebuilding and make sure things happen.

"When there's no one in charge, there's no one to take credit for the victories, and no one to blame when nothing happens," said Fields, who is now at Texas State University-San Marcos. "Until you have someone say, 'You are responsible for that,' it's never going to succeed."

Charity said his company bought the property in spring 2007 for $1.35 million at the urging of his then-5-year-old daughter, Dakota, who was sick of having to travel from their storm-battered Lakefront neighborhood to Metairie for ice cream. She thought the Lake Terrace Center would be a great place for an ice cream shop.

Charity said he wanted to bring back many of the original tenants, but they were squeamish about returning when the neighborhood's future seemed so uncertain, and finding other tenants proved challenging without reliable repopulation figures. Blakely approached him about forming a public-private partnership with the city and offered $4 million in financing through grants and loans, Charity said, but that was cut to $2 million and eventually fell by the wayside as the Landrieu administration came into office and had a different plan for how to allocate rebuilding money. Meanwhile, in 2009, Charity asked for $1 million in economic development financing from the city to assist with his plans, but he was approved for up to $250,000. He has spent most of that money.

DMK is now focusing on its application to the state's Project-based Opportunity Program for $4.2 million in loans and an application to the city's Fresh Food Retailer Initiative for $1 million. If both of those come through, Charity says he can come up with the rest to pull off the $7 million to $8 million redevelopment project. He said DMK has already sunk about $2.3 million into it through its original investment, a loan from First NBC bank, and the economic development funding.

The state said his application is still pending, and it declined to comment on its prospects. The city says DMK has not applied to the fresh food program.

While Charity said he understands the change of administration and bears the city no ill will over the policy changes that have affected him, his lender, First NBC, places the lack of redevelopment at Lake Terrace squarely on the city.

"The neighborhood's frustrated, he's frustrated. They blame him, but the reality is, it's not his fault. It's government's fault he hasn't been able to get it done," bank President Ashton Ryan said. "He's been promised the money, but he hasn't been able to get it. They just run you around the block."



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