More than two years have passed since Hurricane Katrina blasted New Orleans and the Gulf Coast, killing nearly 2,000 people, eliminating jobs, and resulting in billions of dollars in property damage. That period has been characterized by agonizingly slow governmental redevelopment and uncertain private investment prospects. But apart from leadership errors, which contributed to the recovery's slow pace, I have come to the conclusion that the devastation was so extensive, it was essentially inevitable that this length of time elapse in order to advance the region's recovery to the point that private sector investment can proceed on a large scale.
California's 1994 Northridge earthquake. Compared with the damage I saw after those natural disasters, it was clear from the time of my first trip to the Gulf Coast region that Katrina's losses were far more massive.
I spent a great deal of time on the ground in New Orleans in the 1990s because of its troubled public housing projects and impoverished neighborhoods. The existence of dire poverty, bereft senior citizens, and unemployment–which became evident to the nation as a result of Katrina–had been the story of Gulf Coast communities for decades. The unmasking of these realities offers a wider citizenry the opportunity to address them directly and correct old mistakes, build better structures, enhance the job base, and create stronger communities with a better quality of life.
Delays and Damage
Beyond the unprecedented magnitude of loss of life and property damage, what struck me as different about the consequences of Katrina was that so much of the area's basic infrastructure was completely destroyed. After other disasters, we have been able to expedite rebuilding because the task was to clear away damaged surface property and redevelop on site. However, Katrina destroyed underground water systems, sewage systems, electrical power generation, and other basics.
It has taken the better part of two years to replace the damaged infrastructure, and so only now is it possible to begin the process of vertical construction. That is not to excuse the delays, indecision, and inefficiencies associated with the governmental response, but it does suggest that we are now at the point where it is possible to proceed with private investment, plat lots, and begin home building and commercial construction.
Make A Difference
I have seen from my CityView experience that when workforce housing is available, it sells. There are now serious opportunities for residential and commercial builders across the country to invest in the Gulf Coast region. Investments that may not have been possible before are now worthy of a second look and of action.
New Orleans and the Gulf Coast represent an immense home building opportunity. Just analyzing the volume of what needs to be replaced marks the region as one of the strongest growth areas in the country. Compared with the housing construction slowdown in other regions, this may be an excellent counter-tactic for companies to continue to build through the trough in the economy.
There are sound business reasons that make investment in Gulf Coast projects worthy to consider. There are valid national interest reasons as well. It is not the American way to write off a region, to lose a city, or to turn one's back on people when the capital and expertise they need is available and can be rewarded with reasonable returns. As a nation, we refer frequently to the power of free enterprise institutions to produce results under circumstances where government cannot, and to drive the real economic accomplishments of our society.
A little over two years after Katrina, the time has come to show what home builders as an industry can do in New Orleans and the Gulf Coast.
Learn more about markets featured in this article: New Orleans, LA.