Hard Rock fell down. Kailas got up again

 You'll never keep this city's permanent wealth class down. 

The lead developer of the Hard Rock Hotel, which collapsed while under construction in 2019, has begun construction on a major new project in a former downtown office building two blocks from the site of the fatal disaster.

Mohan Kailas and his partners in the new venture are planning to turn the 31-story skyscraper at 1010 Common Street into a mixed-use complex with two hotels, including a 250-room Fairmont Hotel with a rooftop pool.

The project, which will cost more than $90 million, will also include an extended stay Element Hotel and six floors of office space.

It's so obscene you almost have to admire it. 

It’s the first big project for Kailas, a seasoned developer with several successful real estate projects under his belt, since the Hard Rock fell. The collapse killed three construction workers and injured dozens of others. Kailas was never accused of criminal wrongdoing in connection with the disaster. In legal filings and prepared statements, Kailas and his partners have blamed the project’s engineer and steel provider for the structural failure, which remains the subject of more than 100 unresolved lawsuits.

Oh well, no one to blame. Nothing has to change. And now we're right back to building nice things for rich people in a city facing an ever-worsening housing crisis. Yes, there will be a public subsidy. Why even bother asking anymore, really. 

Kailas and his partners in the project, which include Atlanta-based investment group Monarch Private Capital, will use federal historic building tax credits to help finance the building’s conversion. The tax credit program enables developers to recoup 20% of what they spend rehabilitating a building.

Property rights

At first glance it might seem at least a little bit insensitive of Kailas to even bring this up.  

The developers of the ill-fated Hard Rock Hotel have sued the city over a new measure that would restrict the height of future construction at the site of the building collapse, alleging that it’s a politically motivated ploy from City Council member Kristin Gisleson Palmer.

The developers say that lowering the maximum building height allowed at the site from 190 feet to 70 feet constitutes an illegal taking of their property, and they’re asking an Orleans Parish Civil District Court judge to declare a motion sponsored by Palmer null and void. 

After everything that happened here, the damage, the disruption, the cost, the injuries, the deaths, the exposure of the corrupt systems that underlie all of it, you'd think that the property owner doesn't  just say "my bad" and start over.  But we're so far off the edge of the map with regard to oligarchic late stage capitalism now that all the human questions about what should happen with that space now must take a back seat to the sacred "property" rights of people like Kailas to suck maximum value out of it.

Also he's probably just thinking the developers own their own judges now anyway. Might as well put that work. 

The developers’ preemptive lawsuit says that the process leading up to the June 3 vote was fatally flawed and that a judge should order it reversed. The lawsuit claims that an April report from the City Planning Commission cited only vague generalities about economic damage instead of specific violations of the city's comprehensive zoning ordinance.

The lawsuit has been assigned to Judge Jennifer Medley. The city declined to comment.

Oh yeah that's still going on

Well we were gonna blow it up. Then we were gonna take it apart. Then we were gonna blow it up again. Then the world went all to shit so we're back to arguing now.

The demolition of the Hard Rock Hotel in New Orleans is once again in limbo, with the city and the developers behind the project at loggerheads over how to bring down the partially-collapsed structure that has remained virtually untouched for five months.

City officials and 1031 Canal Street Development, the firm led by developer Mohan Kailas that was building the project, are each pushing different contractors and different methods of knocking down what remains of the 18-story building and retrieving the bodies of two workers that are still buried in the rubble.

The insurer says it's too expensive to implode so the developer wants to go back to piece-by-piece demo. The city wants to do the implosion and make the developer pay for it. It's not clear what the end game strategy is now.  The thinking had been the developers want the whole lot plus adjacent buildings they own cleared away because that would make the block more attractive for resale. 

But now, who knows.  Who knows what any land is worth right now, anyway.

Paramilitary experts

Of course all the prominent business persons in New Orleans hire mercenaries with Iraq war experience to do stuff for them. That's just normal.

Sometime after the disaster, the developers hired “paramilitary experts” with experience in Iraq and Afghanistan to try to recover the bodies, but they were not allowed to enter the site because of the danger of collapse, Miller said.

"Sometime after the disaster" is a regular occurrence in this town.  If you can afford to be prepared for that, then of course you are.

Every emergency is an opportunity

No, we're not talking about Sewerage and Water Board just yet. But we'll get to it. There's a lot of emergencies to keep track of. Meanwhile, back at the Hard Rock site, the developers charged with demolishing the mess they've made there want to also knock down three more buildings in the process. Is it absolutely necessary for them to do this?  They haven't explained that yet. But it does look like it would be beneficial to them either way.

There’s also a worry that the developers might benefit from knocking down the buildings, since it would leave a large vacant parcel that could be sold or redeveloped to recoup the mounting costs of the collapse.

“All of that is a matter of speculation, but it certainly would result in a larger parcel for redevelopment and no assurance on what would be put back there,” Lott said.

There is a review process that goes through HDLC and then through other bodies including the City Council with probable input from the mayor.  But often these sorts of things get expedited during an "emergency." 

Do the collapse

Turns out they have to blow more stuff up. Terrific way to ring in the New Year. Don't worry. The football and tourism related events will still happen, of course.

City officials presented a timeline for when the implosion of the failed Hard Rock Hotel construction site would happen shortly after they announced the demolition of the building would move forward at a press conference Tuesday evening.

Fire Superintendent Tim McConnell told media the building should be imploded in nine weeks, with recovery of the bodies of two still-missing workers and further investigation to follow. A three-month cleanup will also take place after the planned implosion.

The only factor that could move the demolition past the nine weeks is the College Football Playoffs and New Year's Eve events, McConnell said. "We will not let it interfere with CFP," McConnell said.

This also says they're going to stabilize the "Alpha" crane that has been dangling over Canal Street since the last time they set off explosions down there.  That one collapsed into the now-condemned building while the other broke in half and nose-dived into Rampart Street where it punctured a sewer line.

This result was different from the elegant "umbrella closing"  effect officials said they were going for beforehand. Nonetheless, we were all told immediately afterward that the crashing and dangling was, in fact, exactly what they meant.  McBride also noticed this discrepancy and points us to this video where the contractor continues to say that it happened just like they planned.  McConnell even said at the time that after the demolitions, the dangling Alpha crane was "very stable." It's weird though that the thing they did on purpose just left something that still needs to be stabilized hanging off the side of the building for a month. Sounds fishy to us. But it was good enough for the sages at Georges Media where the moral of the story was, as usual, everyone in charge is doing a great job.

For a different take on that, please see this month's Antigravity where Jules Bentley offers this counterpoint. 

It’s not surprising that Mayor Cantrell now wants to raze the whole structure to the ground, since this murder monument indicts her entire political class. What a towering tribute to its enablers the Hard Rock Hotel presents, a great slumping sundial whose gnomon points to their collective moral lodestar, unquenchable greed. It celebrates the greed not just of its developers but all who collaborated on, encouraged, profited from, and rubber-stamped this deathtrap. The list of the guilty is long, and every name on it is written with the blood of the building’s laborers—for Mammon, whose temple this is, desires human sacrifice.

Yeah you are going to want to read the rest of that. Jules is probably the only writer in town who can so, um, lovingly pull together the threads of New Orleans power, politics and exploitation that run through this story.  (Others who lack the patience and craft can only blurt stuff out into the void.)

I do feel compelled to add one bit, though.  In this passage, where Jules is describing one of the Kailas family's several scandalous entanglements with the corrupt polity, we learn what became of their Bayou St. John home.

Because the Kailas family is one of metro New Orleans’ biggest landowners and developers, almost everyone’s in bed with them, including former Governor Jindal, whose various campaigns they provided with tens of thousands of dollars of donations, monetary and in-kind.

In just one year under Jindal’s tenure (2011-2012), the Kailas-owned Lago Construction firm got more than $1.5 million of taxpayer money through state contracts—contracts which, thanks to the hard work of WWL’s investigative team and David Hammer, we now know were variously improper and fraudulent. On dates they charged taxpayers for long days of public service work, Lago employees were instead laboring on the Kailas family’s multi-million dollar Bayou St. John mansion. You won’t find them there now, alas. In 2016, they sold that property to Metro Disposal CEO Jimmie Woods for ten dollars.

Woods immediately put the Kailas house to use as a venue for political fundraising events. This one was for JP Morrell who was considering a run for mayor at the time.  Look at all the folks who showed up.

In addition to Gov. Edwards, the $250-per-person fundraiser at businessman Jimmie Woods’ home on the bank of Bayou St. John drew a host of other Democratic officials — U.S. Rep. Cedric Richmond and Public Service Commissioner Foster Campbell, who is running for U.S. Senate, as well as City Councilman Jared Brossett and current and former members of Mayor Mitch Landrieu’s administration. The packed event suggested an unusually strong coalition around a term-limited state senator, and Morrell acknowledged there is widespread speculation around who will run in New Orleans’ upcoming mayoral race.

Not long after that Woods hosted a similar event for Karen Carter-Peterson.  She didn't run for mayor either. But that's not the point here so much as it is that, politically speaking, New Orleans is a small town where the money does seem to go around and around in a very tight circle. You can get a pretty good glimpse of it behind just about any building you knock over.

Will Eddie Rispone "tort reform" Hard Rock victims out of their fair share?

The city says the demolition, clean up, and recovery operations following the Hard Rock hotel collapse have cost something on the order of  $400,000 per day. That's bound to be a sensitive issue, particularly now that we are heavy into budget season. The mayor assures us, though, that we're going to make sure we're covered.

The presence of police, firefighters and other city workers on the site has been costing taxpayers about $400,000 a day Cantrell said Monday, pledging that those costs would be recouped once the “responsible party” for the disaster is found.

“We’re making sure every step of the way the liability is with the responsible party, and that is not with the city of New Orleans,” Cantrell said.

Determining responsible parties is going to be critical in this case because, unlike many of the disasters we are used to around here, this one won't draw any help from FEMA. The city has also set up a "resource center" at  the Main Library for workers and business owners who were affected by the disruption.  Also there is an intake survey for businesses to fill out online here. Presumably, even the "disrespectful" businesses are allowed to do this.

Despite a week-and-a-half-long interruption to daily life at one of the city’s busiest intersections, Cantrell said displaced residents and many business owners have shown patience. But she also said some businesses had been "downright disrespectful" and impatient in the face of closures and evacuations. She didn't name any of them.

Inevitably all of this is headed to court where the city and various other aggrieved parties will look to hold Hard Rock, the developer Mohan Kailas, and the primary contractor Citadel Builders accountable for damages.  Multiple lawsuits have already been filed.  Because Citadel and its subcontractors had been in the practice of misclassifying workers, many victims and families may not be eligible for healthcare or worker's comp benefits.   In the absence of federal disaster relief, legal action is likely the only recourse for everyone.

Meanwhile, the statewide election is into its runoff stage. Republicans are on the verge of capturing legislative supermajorities and possibly the Governor's office. One of the animating issues for them this year has been "tort reform."

Oil and gas isn’t the only business sector trying to attribute Louisiana’s problems to trial lawyers The Louisiana Association of Business and Industry has long been engaged in demonizing trial lawyers as the bane of Louisiana business, while they’ve waged a campaign for “civil justice reform”, as they’re now calling it. LABI has long been the primary financial backer of Louisiana Lawsuit Abuse Watch, which claims to be “a citizen watchdog group dedicated to stopping lawsuit abuse that threatens local businesses and jobs.”

The remaining Republican candidate for Governor happens to own a large construction industry firm himself.  He has some pretty strong opinions about the rights of injured workers and governments to sue companies who have caused them injury. 

Rispone, who compared himself to President Donald Trump, pointed to Louisiana’s natural resources, including oil and gas, that he said should be bringing the state jobs.

“Lawsuit abuse is killing thousands of jobs,” Rispone said. “You know that better than anybody.”

The soon to be governing power in the State of Louisiana defines the only available path to remuneration for disrupted small businesses, compensation for depleted public finances, justice for injured workers, and reparations for a despoiled environment as "lawsuit abuse" and wants it obliterated. 

Once this radical faction is in office, will it move to obstruct justice for the Hard Rock victims? If so, who will speak out for them? Don't count on the Advocate editorial board.  In its endorsement of John Bel Edwards, the paper offered a few issues on which it continues to disagree with him.

There are, after all, many problems to solve, and we haven’t always agreed with the governor’s approach to the state’s underlying challenges. Louisiana needs a governor who supports tort reform and will stand up to trial lawyers and teacher unions. Lawsuits against energy companies put our state at a disadvantage when it comes to attracting investment.

Once the dust blown about by a building collapsed by criminal capitalism has settled, and the damage incurred by its several victims endures, don't expect much sympathy from the local media monopoly. Not when there is still "investment" to attract and unions to crush, anyway.