Urban Wal-Marts

No Big Easy

Pres Kabacoff of Historic Restoration is the very picture of the hard-charging, smart growth-based developer, whose projects (in New Orleans and St. Louis) tend toward revitalization of derelict inner-city properties and brownfields. His track record and emphasis on sustainability have long made him the darling of New Urbanists, but all that’s now changed in his hometown of New Orleans, and the reason can be summed up in a single word: Wal-Mart.

Wal-Mart’s usual procedure is to colonize open space or take over suburban shopping centers. It doesn’t usually locate in center cities, and that’s what makes its plans for New Orleans—as part of a Kabacoff master plan for replacing a demolished housing project—so unusual, and so reviled.

Everyone in the Big Easy agrees that the 1930s St. Thomas Housing project, with 1,510 units and a huge amount of crime and despair, had to go. But its closing displaced 850 public housing families, who were promised relocation to something better. Kabacoff’s plan, supported by a federal Hope VI grant, will mix former St. Thomas families with upscale market-rate tenants, but critics say only about 70 families will be able to return. And a 200,000 square-foot Wal-Mart (with 825 parking spaces) will be their neighbor.

Kabacoff argues that to complete the project he needs Wal-Mart sales tax revenues to back $20 million in bonds (a process known as "tax increment financing"). "Wal-Mart was the only chain willing to give this a chance," Kabacoff says.

But the plans for River Garden, as it’s known, have drawn hordes of dissenters, some of them as wealthy as Kabacoff. They’re outraged at the prospect of many millions in state, city and federal financing supporting one of the world’s richest and most acqusitive corporations, whose store could suck the life out of the revitalized Magazine Street district. Supporters say the plan will create much-needed jobs, but detractors point out that the company pays low wages, and its presence could drive away higher-paying work.

"This project would irreparably harm the Lower Garden District," says Bill Martin, a New Orleans lawyer and former Kabacoff supporter who now leads the opposition. "It would also provide a huge subsidy to Wal-Mart, one of the most recalcitrant of the big-box retailers." Martin, whose own restored Garden District mansion was built in 1859, says 70 percent of Magazine Street’s retailers sell products also sold in Wal-Mart, which expects to do $100 million in annual business when its New Orleans store opens in 2005.

Opponents have sued to stop River Garden in both state and federal court, so the project (which is otherwise approved) could be stillborn. In the meantime, it’s causing considerable angst in the city that once let the good times roll. "New Orleans is having a lot of trouble figuring out what progress looks like," says Wade Ragas, a professor at the University of New Orleans.