Like many downtown residents, whenever I open my front door I catch a glimpse of the decaying Plaza Tower, once the grande dame of Loyola Avenue. I see the blown-out windows, black netting and colorful graffiti that makes the building an ongoing eyesore. I’ve been in New Orleans long enough to remember when the Plaza Tower was the home or workspace to creatives types like urban planner and artist Bob Tannen and his wife Jeanne Nathan, who appreciated the building’s unique aesthetics. Current owner Joe Jaeger is trying to unload the asbestos-laden structure and the avoid hefty unpaid fines that have caught the attention of Inspector General Ed Michel.
A 45-story 531-foot skyscraper, the Plaza Tower was the third tallest building in New Orleans when it debuted in 1968 but lost that distinction when the taller One Shell Square opened four years later. The Plaza Tower was designed in the modern style as an office building with a few residential spaces on the upper floors. By 2001, the building was suffering from leaks and deferred maintenance, which created a welcoming environment for toxic mold. In 2002, the building closed after hundreds of public employees whose offices were in the building relocated to another site.
In 2005, the Giannasca Development Group acquired the building for $4 million and planned to build 197 condominiums until Hurricane Katrina and insurance issues got in the way. Plainfield Asset Management purchased the building at auction for $583,000 in 2007 and two years later began what was expected to be a $10 million preliminary renovation and asbestos remediation project. Yet work stalled and the building reappeared on the auction block again in 2011. After several more years of non-action, the Plaza Tower (also once known as the Crescent City Towers and Crescent City Residences) became part of Joe Jaeger’s portfolio in 2014.
Developer Joe Jaeger started out as a blue-collar plumber and has built a modern-day empire through ingenuity and hard work. He is a major hotelier and currently working with David and Andre Rubenstein on an upscale conversion of their two upper floors at the intersection of Canal Street and St. Charles Avenue into a luxury boutique hotel. Known for his aptitude as a wheeler-dealer, Jaeger and Mardi Gras World’s Barry Kern are also creating a new attraction expected to draw thousands of visitors each year.
Jaeger has been involved in many other projects, including the troubled former naval base in Bywater, since acquiring the Plaza Tower redevelopment, and it never really became a priority. Now the building has become an expensive albatross that must be eliminated. Given the building’s physical condition and overall market conditions, who would want to acquire the Plaza Tower at any price?
“It’s hard to finance anything today,” said one major New Orleans developer who is familiar with the property but wanted to remain anonymous. The building’s floor plate is also so small — only 6,000 square feet instead of 25,000 square feet to 40,000 square feet in many other available properties — which means a lot of space will be taken up by a central utility system. Also, the problems with the structure will be especially costly to repair.
“Even if a new buyer got the building real cheap, almost for free, a low purchase price may not get him or her over the hump. Beyond the normal historic credits, federal funds would not be available, which makes any use more challenging,” he said. The purchase of the existing building would certainly be a long-term investment that could challenge any new owner. The property would also be more attractive if a master plan was underway for the revitalization of the nearby Union Passenger Terminal.
Considering that the cost of bringing the Plaza Tower back into commerce might not make financial sense at this time, demolition may be the only viable option. Jaeger’s team might even be suggesting the same to potential buyers. Real estate development projects used to be surefire bets in New Orleans, but not anymore. Our market, like the nation, is cool right now, and we are additionally impacted by the crime problem. Jaeger will address the City Council again next month on the status of the building. Whether Jaeger sells the property or tears it down, it’s long past time for definitive action at the Plaza Tower.
Danae Columbus, who has had a 30-year career in politics and public relations, offers her opinions on Thursdays. Her career includes stints at City Hall, the Dock Board and the Orleans Parish School Board and former clients such as former District Attorney Leon Cannizzaro, former City Councilman Jared Brossett, City Councilwoman at-large Helena Moreno, Foster Campbell, former Lt. Gov. Jay Dardenne, former Sheriff Charles Foti and former City Councilwomen Stacy Head and Cynthia Hedge-Morrell. She is a member of the Democratic Parish Executive Committee. Columbus can be reached at email@example.com.