The 1 million square foot landmark building, shuttered since Hurricane Katrina in 2005, has seen renovation costs rise “well north of $500 million” compared with an estimated $300 million two years ago when proposed anchor tenant Tulane University signed a lease to occupy a significant part of the building.
Such mounting costs and disruptions in who should be leading the project have resulted in new developers being brought in, the report said. Louisiana State University, the building’s owner, originally selected development company 1532 Tulane Partners.
“1532 has done a good job, but the world has changed quite a bit from the time the deal was inked,” said Rob Stuart, president and CEO of the LSU Foundation. “With the convergence of inflation, interest rate increases and COVID, the project requires more capital than was originally envisioned.”
The project, which could eventually result in the formation of a biomedical district stretching through central New Orleans and encompassing Tulane University and LSU medical campuses and hospitals, will likely not be partially open until 2027, two years later than planned, the report said.
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