SOUTHEAST SNAPSHOT, JULY 2004

New Orleans Retail Market

For most of the metro New Orleans area, new development means redevelopment of existing occupied properties due to the lack of available vacant ground.

Richard Kirschman Senior Sales Associate NAI/Latter & Blum Inc.

“New Orleans is a very mature market with limited room to grow due to the unique geography of the area,” says Richard Kirschman, senior sales associate with NAI/Latter & Blum in New Orleans. “This factor is especially prevalent in east Jefferson Parish, but there are signs of this trend on the Westbank as well.”

Another trend is the willingness of major department stores to consider locations outside their normal habitat of regional enclosed malls. JC Penney is a local example, with its recent opening on the Northshore.

The continuing growth and dominance of Wal-Mart is having the same kind of fallout on the grocery industry that it had with discount department stores, as evidenced by Albertsons’ recent decision to exit the market. Wal-Mart recently began construction on its eighth area Supercenter, a 217,000-square-foot store to be located on the site of the former St. Thomas housing project in the New Orleans inner city.

Retailers new to the New Orleans market include Cost Plus World Market and Whole Foods. Major recent leases include Circuit City in Slidell and Whole Foods in Metairie. At more than 50,000 square feet, this new Metairie Whole Foods store — the grocer’s first entry into the suburban market — will be more than 50 percent larger than its successful uptown location.

Active retail developers include Weingarten Realty Investors, Stirling Properties and Realm Development.

The majority of retail store growth is taking place in suburban St. Tammany Parish, as it is the area of highest population growth and income levels. “The corridor that may see increased interest in the near future is Uptown, an under-retailed area, notwithstanding barriers to entry caused by scarce commercially zoned land, active neighborhood associations, historic preservation organizations and the cost of assemblage of large land tracts,” says Kirschman.

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