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Flaws undermine WTC redevelopment plans

By Greg LaRose

CityBusiness

July 2, 2013

A selected committee of city officials were considering the three proposals to redevelop the former World Trade Center site as this column was being written. Inside and outside the industry, it is considered one of the biggest decisions in the history of New Orleans real estate.

The Bureau of Governmental Research stressed its importance in a report issued a day ahead of the presentations. It also noted that two of the three submissions were lean on details, drawing this conclusion even after meeting with the three development teams.

Whether you consider them boldly conceptual or critically deficient, the paucity within the proposals is not the sole fault of developers. As the BGR noted earlier this year, the request for proposals from the city also held scant specifics.

A letter that BGR President and CEO Janet Howard sent to Mayor Mitch Landrieu in February described the city’s RFP as vague and ambiguous. Specifically, she was critical of the selection criteria and their unclear connection to the RFP’s goals as well as open-ended language concerning the use of public subsidies.

The request, issued in January, says the redevelopment “should be” privately financed, which is at best a lukewarm suggestion and hardly a requirement. The RFP also says developers “should be prepared” to pay the New Orleans Building Corp. to use the site, but offers no structure for such an arrangement.

The RFP also listed nine goals for the project, among them a call for a “world-class civic space” and “appropriate commercial uses” for the property. Beyond that, there were no indicators as to what constitutes a “world-class” or “appropriate” development.

Dozens of developers and representatives of construction, architecture and engineering firms attended a pre-bid conference in late January to learn more about the process, with Deputy Mayor Cedric Grant encouraging bidders to be creative, but only three proposals were submitted by the April 3 deadline.

To be fair, some of the attendees at the pre-bid conference have teamed with the developers that submitted proposals, but three proposals cannot be close to the variety city officials had hoped to obtain.
Instead of crafting a clearer vision and a more solid set of standards for the proposals, the RFP positions New Orleans for a repeat of history. Twice since 1998, proposals to redevelop the WTC have fallen apart.

Larry Sisung’s development team was chosen 15 years ago to place a 635-room hotel in the 33-story tower, but their package crumbled under the weight of the Sept. 11, 2001, terrorist attacks, lawsuits challenging the structure of their deal and ultimately Hurricane Katrina.

Full Spectrum, a New York development company, was chosen in a 2007 RFP process that drew eight bids, but it backed out of the project in August 2008 — a day before the City Council was schedule to approve their proposal.

One of the proposals brought forward this week could well take root and provide the long-sought invigoration of the Mississippi Riverfront. But the process to date is wrought with flaws that make such a scenario improbable.

The city may have had the best intentions when it crafted its request for proposals, but its shortage of specifics could lay an unstable foundation for any project that moves forward.

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