In The News › Cesar Burgos in; Gowri Kailas out as developer of Lake Forest Plaza

Apr 17, 2009

Source: Times Picayune

Filed under: Orleans Parish, Taxation & Assessments

Cesar Burgos in; Gowri Kailas out as developer of Lake Forest Plaza

Cesar Burgos in; Gowri Kailas out as developer of Lake Forest Plaza
by Kate Moran, The Times-Picayune
Friday April 17, 2009, 9:25 PM

Attorney and Regional Transit Authority Chairman Cesar Burgos told a neighborhood group this month that he has stepped in as developer of Lake Forest Plaza, a former shopping center whose longtime owners were delinquent on a debt they owe the city.

An investment partnership that included Gowri Kailas and local banker Ashton Ryan for many years controlled the plaza, which was mostly demolished after Hurricane Katrina and remains an eyesore for eastern New Orleans. A state senator briefed on the matter said Kailas has been bought out and Burgos has been recruited to help revive the Read Boulevard shopping center.

Burgos and Ryan did not return repeated calls to their offices and cell phones, but members of an eastern New Orleans neighborhood group said Burgos told them he would act as the primary developer and that the arrears on the property would be settled as part of the new arrangement.

The city made a loan in 2001 to Lake Forest Plaza LLC, the partnership that included Kailas and Ryan. After the loan lapsed into delinquency, a judge ordered the company in 2007 to pay the city $1.5 million plus late penalties and legal fees. A city spokeswoman said this week that the city attorney continues to pursue the debt collection.

Kailas was involved with another partnership, Grand Theatre LLC, that also owed the city a substantial debt. The movie theater is next to the Lake Forest Plaza property, and it could not be determined Friday whether Burgos was also involved in redeveloping the theater.

Burgos is a friend of Mayor Ray Nagin, who appointed him to the chairmanship of the Regional Transit Authority board in 2006. Burgos has made at least one prior foray into real estate development, when he and his law partner bought the former City Hall annex on Canal Street from the city, also in 2006.

Details about his role in the Lake Forest Plaza redevelopment remained murky Friday. The city land records do not reflect that the property has sold in recent months. State Sen. Ann Duplessis, D-New Orleans, said she did not know whether Burgos had joined the project as a partial owner or simply as the developer.

“It appears as though Gowri has been bought out of the plaza, “ she said. “I am not sure if it is now 100 percent owned by Ashton or if it has been sold to the developer who will be developing that property, which is Cesar Burgos.”

Neighborhood meeting

Burgos appeared this month at a meeting of the East New Orleans Neighborhood Advisory Commission, called to address residents’ concerns that basic services, including a hospital and shopping, had not returned to that part of the city. Burgos told residents that he hoped to bring outlet stores to Lake Forest Plaza and possibly work with Wal-Mart to open a store there.

He appeared to be working on a relatively brisk timeline, telling residents that he wanted to have plans in motion by the summer. Although he did not divulge much detail, he left several residents with the impression that he would help take care of the outstanding debt on the property.

Duplessis said this week that the Ryan-Burgos partnership had talked to her about activating a tax-increment financing district to help pay for the redevelopment, a move that would direct sales tax generated at the shopping center back into the site. Groups such as the Bureau of Governmental Research have previously opposed the TIF because of the outstanding debt at the plaza.

“It was my understanding that all of that was cleared out the way and he would be doing the developing. That was part of his taking the job on, “ said resident Mack Slan, who attended the meeting.

Ceeon Quiett, the city spokeswoman, said she had no information about the new arrangement at Lake Forest Plaza. Of the outstanding debt she said, “Our city attorney is moving forward in terms of our collection.”

Kailas, the partner who reportedly sold his interest in the property, declined to comment. He referred questions to Ryan, the president of First NBC Bank, who did not respond to messages left on his cell phone, with his secretary and through a bank spokesman.

Residents optimistic

Residents who heard Burgos speak were enthused about his plans, although they appear tentative. Don Randon, a local real estate broker who represents Wal-Mart, said the big-box retailer still owns property in eastern New Orleans on the other side of the interstate from Lake Forest Plaza. Although the plaza is the type of site Wal-Mart might consider, Randon said there has been “no deal, no agreement and no real negotiation” for the store to move there.

Councilwoman Cynthia Willard Lewis, who represents eastern New Orleans, said this week that she believes Ryan reached out to Burgos because she thought he had the business acumen to redevelop Lake Forest Plaza. She said the pair were still looking at options and not ready to discuss plans.

Council President Jacquelyn Brechtel Clarkson, who attended the eastern New Orleans neighborhood meeting this month, said she is almost certain that Ryan owns the property and Burgos is acting as the developer. She said redevelopment of the property is critical not only to removing blight, but also to building the city’s tax base.

Tangee Wall, who leads the economic development committee of the East New Orleans Neighborhood Advisory Commission, said the group had a positive impression after the meeting with Burgos in early April.

“He is committed to working with us very closely to ensure it is a quality facility, and that was just a wonderful experience to hear that. We look forward to future meetings with him, “ Wall said.

. . . . . . .

Bruce Eggler and Coleman Warner contributed to this report.

Kate Moran can be reached at or 504.826.3491.

Apr 17, 2009

Source: Times Picayune

Filed under: Orleans Parish, Taxation & Assessments

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