Upper Pontalba Building apartments on Jackson Square are in line for higher rents

Residents of the city-owned Upper Pontalba Building on Jackson Square likely will be paying higher rents by midsummer as the agency that manages the historic building attempts to bring leases more in line with market rates in the French Quarter.

At its monthly meeting today, the board of the Upper Pontalba Building Restoration Corp. will consider a staff recommendation to raise monthly rents for all 50 units in the four-story complex, which range from $560 for a 543-square-foot fourth-floor unit to $2,510 for a 1,688-square-foot unit on the second floor.

The increases, which are expected to win board approval, would be the first in about four years. While the bulk of the suggested rent increases falls into the 20 percent to 40 percent range, a couple would rise about 70 percent, with a handful going up 15 percent or less.

The state-owned Lower Pontalba on St. Ann Street and the city-owned Upper Pontalba across Jackson Square on St. Peter Street were built in 1849-51 by Baroness Micaela Almonester de Pontalba. Arguably one of the most desirable parcels in New Orleans, each building consists of 16 four-story townhouses that have commercial tenants on the first floor and apartments on the upper floors.

The current Upper Pontalba tenant list features some notable names, including former New Orleans City Councilwoman Suzanne Haik Terrell; former U.S. Rep. Claude "Buddy" Leach, the chairman of the state Democratic Party; Ellis Henican, who co-wrote Sean Payton's memoir about coaching the New Orleans Saints to their first Super Bowl victory; insurance executive John Casbon; and Baton Rouge family court Judge Toni Higginbotham.

But the Pontalba building lacks certain amenities, including parking and security, and some of the units feature less-than-ideal floor plans. The structure also has no handicapped access and no elevator.

'Something for their money'

For more than a decade, the panel of mayoral appointees has raised rents every three years or so, using comparable properties in the Quarter for guidance. A plan to bump up rents by 10 percent across the board was tabled last summer after newly elected Mayor Mitch Landrieu overhauled the membership and the agency's top administrator resigned under fire.
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Frank Pizzolato, the new executive director of the French Market Corp. and the Upper Pontalba agency, said he made rent adjustments one of his top priorities after taking over the job in January.

While it's no secret that tenants oppose higher rents, Pizzolato said his agency is legally bound to get fair market value for the city's property.

If the board adopts his plan, Pizzolato said he intends to address longstanding tenants' concerns by reinvesting the extra revenue into security cameras and two full-time positions: a maintenance supervisor and a building manager.

"They're certainly going to get something for their money,'' he said. "This is an old building and this has become an issue of how good a steward we're going to be of the people's property.

"We recognize that this is an incredibly valuable piece of real estate. We can do nothing less than make sure it's maintained properly.''

Pizzolato said he will offer board members two options: one that boosts all rents to levels recommended by a market survey, and another that incorporates the advice of three brokers who said the survey lowballed the value of units with balconies and overestimated the amount renters would pay for other apartments, particularly those on the fourth floor.

The across-the-board increase would raise rents an average 39.2 percent compared with the status quo, and it would generate about $372,000 more annually, assuming the complex is full, records provided by the agency show.

While the change could bring in top dollar, steeper increases also could drive away tenants, Pizzolato said.

"The potential downfall on this is a mass exodus of tenants from the less desirable units and the potential of not being able to fill them at the much higher rents ... resulting in a substantial decrease in revenue," he said.

The other choice, which the French Market staff recommends, "allows us to stay competitive in the market, at the same time generating a good deal more revenue," he said.