Home economics
IF MARKET FORCES ARE GOING to determine much of what happens in the rebuilding of New Orleans, the announcement this week by Los Angeles-based builder KB Home that it will partner in the construction of new homes outside the city and its flood zones offers a hint of what that will mean -- for good and ill.
KB and its smaller local partner, the Shaw Group, are eyeing acreage just outside the city in Jefferson Parish and in Baton Rouge, Louisiana’s capital. They could eventually build tens of thousands of entry-level homes. They are unlikely to consider rebuilding individual homes in the city because that’s not how they do business. KB, once known as Kaufman & Broad, succeeds with big, uniform housing developments that make use of grand economies of scale.
It’s a plan that makes business sense, given the loss of housing in Katrina. It could also give an economic boost to the region, though there’s no guarantee that New Orleans residents would get the skilled construction jobs that would result.
Where does that leave the city? Its first steps toward developing a reconstruction plan have not fared well. A commission ordered by Mayor C. Ray Nagin recently proposed that New Orleans concentrate its efforts first on the areas most lightly damaged, meaning that the ravaged homes of the mostly African American and mostly poor Lower 9th Ward would be last on the list. Objectively, the plan makes sense, but it triggered angry accusations of racism, and Nagin backed off. And, as The Times’ Peter Gosselin reported Sunday, the federal government shows no sign of embracing President Bush’s early suggestion of a huge public reconstruction effort.
Homeowners are left to decide whether to rebuild in neighborhoods that may or may not be safe from the next storm. The Army Corps of Engineers has made no promises that it will repair or rebuild the failed levees that it built in the first place. Businesses have to wager on the return of their customers, and whether they can survive in the interim.
The city’s mostly undamaged downtown core is staggering back, but the districts that tourists don’t see are in a suspended state. Flooded homes are being cleaned out, and some have been gutted to stop the creep of toxic mold. Beyond that, even residents with the means to rebuild are locked in doubt, without assurances of safety or a master plan.
KB Home rides into this situation not as a rescuing knight but as a seeker of open-market opportunity. The company and its partner are already looking for creative ways to qualify disaster victims for new mortgages. Nagin welcomed the effort Tuesday. In a different situation, KB could be open to criticism as a carpetbagger whose projects will attract those who could otherwise have rebuilt homes in the city. But in New Orleans, the vacuum of authority is too profound, and the prospects for full rebuilding are too distant, to spurn a homebuilder ready to spend money to make money.
