NEW ORLEANS, LA – Mayor Mitch Landrieu and the New Orleans Business Alliance announced that national retail giant Costco Wholesale Corporation (Costco) has chosen New Orleans as its newest location.
Costco has agreed to build a brand new, 148,000 square foot warehouse at the 14.7-acre site formerly occupied by the Carrollton Shopping Center. The project will create approximately 200 full and part-time jobs, utilize 120 prevailing-wage local construction positions and result in a capital investment of over $40 million. The warehouse is expected to open in 2013.
“New Orleanians have said they wanted retail, so we’re delivering,” said Mayor Landrieu. “Costco will bring quality shopping to the city and will attract shoppers from the region, improving quality of life and generating new tax revenues. It also will create quality jobs, as Costco is well known for providing some of the best wages and benefits in the retail sector. Finally, it will revitalize an important commercial property that has been vacant and underutilized for several years. We look forward to welcoming Costco to the community.”
Costco looks forward to it as well. “We are thrilled to be opening a location in New Orleans,” said Costco Chairman Jeff Brotman. “We’ve seen first-hand the resilience of its residents, and we are excited about contributing to the area’s revitalization. The entire community has enthusiastically welcomed us, and we appreciate the warm reception we’ve experienced.”
New Orleans Business Alliance Chairman Henry Coaxum said, “Attracting Costco, the second largest U.S.-based retailer, to New Orleans is a major success for those of us looking to keep our retail tax dollars in Orleans Parish. We were able to match the growing momentum of our city with common sense incentives.”
Costco offers its members quality, brand name merchandise at substantially lower prices than are typically found at conventional wholesale or retail sources. Costco's warehouses present one of the largest and most exclusive product category selections to be found under a single roof. Categories include groceries, candy, appliances, television and media, automotive supplies, tires, toys, hardware, sporting goods, jewelry, watches, cameras, books, housewares, apparel, health and beauty aids, tobacco, furniture, office supplies and office equipment.
Before deciding on New Orleans, Costco performed extensive due diligence on design, site requirements and costs. Further, Costco engaged with neighborhood residents and solicited feedback from the community that was incorporated into plans.
The New Orleans Business Alliance completed an economic and fiscal analysis for the City to evaluate the impact of the Costco project, which revealed the direct net fiscal impact of Costco, taking into account City incentives, over a ten (10) year period is at a minimum expected to be $21 million.
Based on the strong positive impact and other benefits of the project, the New Orleans Business Alliance has determined that the Costco project is appropriate for receiving economic development incentives.
The City expects to facilitate the project by making needed public infrastructure improvements and contributing toward extraordinary on-site costs of the project. Planned public infrastructure improvements in the immediate surrounding area include street grading improvements, curbing replacement, sidewalk repairs, new traffic signals, and catch basin repair on Palmetto, Dixon, Dublin and Cambronne streets. In addition, the City will make improvements to South Carrollton Avenue in front of the warehouse, adding a left turn lane. These costs are expected to be paid with Community Development Block Grant (CDBG) funds.
The City will also contribute to the cost of site elevation work necessary to meet FEMA base elevation height requirements to mitigate flooding and site stabilization through the use of pilings. The City will propose a short-term (5 year) reimbursement of these costs from a portion of sales taxes generated at the warehouse to fund these improvements.
New Orleans Business Alliance analysis determined that the new tax revenue generated by the warehouse can more than offset the investment by the City. Based on expected sales projections, the City expects to receive a net significant increase in sales tax revenue, even during the proposed 5-year reimbursement period.
Costco has committed to use good faith efforts to (i) use New Orleans residents in the construction phase workforce, (ii) hire New Orleans residents as employees at this location, and (iii) meet or exceed the City’s goals for participation of disadvantaged business enterprises.
District A Councilmember Susan Guidry said, “I am excited that Costco will bring its unique shopping opportunity to our city and region. Costco is an engaged community partner that will provide well-paying full and part time jobs with benefits for our local residents. Throughout this process, I have been impressed with Costco’s professionalism and its commitment to opening a store in New Orleans, and I welcome this corporate partner to District A. With this development, the Carrollton Corridor reaches full recovery.”
City Council President Jacquelyn Brechtel Clarkson said, “This is the kind of venture capital that brings investments, jobs, sales taxes and clears blight that we are so proud to now be procuring. Our city is on a roll!"
Chair of the City Council’s Economic Development Committee and District E Councilmember Jon D. Johnson said, “This is another great sign of growth in the City of New Orleans. The addition of Costco to this City will provide a unique shopping experience to locals and visitors alike. We are excited about big box retailers’ growing interest in this city and are prepared to accommodate all retailers with strong reputations for offering quality products and services. We are hopeful that the presence of Costco will serve as an incentive to bring additional high quality retailers to other areas of the city such as Eastern New Orleans, Canal Street, and Algiers.”
“Attracting a top retailer like Costco to New Orleans is a monumental victory in terms of economic development in District A and increasing sales tax revenue for the entire city. It will also increase the quality of life for neighbors that have watched the lot sit vacant since Hurricane Katrina. I want to commend the Administration for ensuring that Costco’s infrastructure needs were met so that this large scale development can progress, and I look forward to working on similar initiatives throughout the city,” said Councilmember-at-Large Stacy Head.
"The commitment of Costco coming to New Orleans is extremely exciting and is a testament to all of the hard work Mayor Landrieu and the City Council have done to improve the economic conditions in the city,” said District C Councilmember Kristin Gisleson Palmer. “This shows retailers around the country that New Orleans is on the move."
District D Councilmember Cynthia Hedge-Morrell said, “Costco’s has made a personal investment in the City of New Orleans. Their presence will surely rejuvenate the Carrollton area and the local economy. This is another win for the citizens of New Orleans!”
New Orleans Business Alliance President and CEO Rod Miller said, “The Costco project will immediately contribute to the City’s general fund, so the reimbursement of cost from sales tax generated at the warehouse makes real sense. We anticipate Costco being a banner project that will be an important step in continuing to promote significant national retail presence in New Orleans.”
“This project meets a number of goals—new retail, new jobs for our citizens, and additional tax dollars for Orleans Parish,” said Aimee Quirk, advisor to the mayor for economic development. “Not only does it present a strong return on investment, having a major national retailer like Costco choose to locate in New Orleans adds momentum to our aggressive efforts to attract quality retail to neighborhoods across our city.”
Costco has submitted initial plans to the City, which are in the approval process. Pending final approval of incentives and permits, Costco anticipates the warehouse being built and open in 2013.
Attached are the site plan and renderings prepared by Costco.
About Costco: Costco Wholesale Corporation operates an international chain of Costco membership warehouses that carry quality, name-brand and related private-label merchandise at a great value. The company has more than 65 million Costco cardholders and 159,680 employees worldwide. Costco is publicly traded on the NASDAQ under the symbol COST. For more information about Costco, please visit www.costco.com click Customer Service, then About Costco, and Investor Overview.
About the New Orleans Business Alliance: The New Orleans Business Alliance is uniting a diverse community of stakeholders to catalyze job growth, create wealth, and build an equitable and sustainable economic future for the new New Orleans. New Orleans Business Alliance is the official non-profit organization tasked with leading economic development initiatives for the City of New Orleans. To learn more, visit http://www.nolaba.org/