Even on a particularly airless late-summer evening, the appeal of the Bywater, a once-working-class New Orleans neighborhood just downriver from the French Quarter, cuts through the oppressive humidity. Rows of century-old shotgun houses and Creole cottages—some brightly painted, others romantically disheveled—line overgrown blocks crisscrossed with telephone wires. On some weeknights, ramshackle corner bars serve free red beans and rice as musicians hold court in packed rooms. Every now and then, a train whistle echoes through the otherwise sleepy streets. The whole neighborhood has long had a languorous, tumbledown charm.
 
Bywater and other neighborhoods with a stock of historic Creole cottages and shotgun houses have been magnets for a recent wave of migration to New Orleans.
 

New Orleans

2013 Population: 378,715
2010 Population: 343,829

2014 Median home price/sq. foot: $100
2011 Median home price/sq. foot: $105

2014 Median rent per month: $1,395
2011 Median rent per month: $1,065

2012 Percentage of renters spending more
than 35% of income on housing: 54.6%


 

 
But now, at one of several culinarily ambitious caf's, restaurants, and bars to open in the last few years, you can order a sampling of small plates inspired by street food from around the world or, down the street, sip a brunch cocktail made with rye, bitters, and fennel foam. It's a delicious development, but it has many New Orleans residents nervous about the changing neighborhood.
 
In the nine years since Hurricane Katrina, gentrification has accelerated in Bywater, along with Faubourg Tr'm', St. Roch, and other downtown districts rich with historic houses, as New Orleans has become a magnet for newcomers. The poster city for disaster recovery has given way to a place making headlines for its art, film, and technology scenes. This phenomenon has drawn many new arrivals who gravitate toward the neighborhoods that embody the city's cultural life. Bywater rents for new listings have climbed by 20 percent every year going back to 2011. Along with post-Katrina displacement, shuttered schools, and other factors, these soaring housing costs have pushed out many longtime residents.
 
The overall population of New Orleans has rebounded from an estimated 158,353 shortly after Katrina to more than 378,000 (it was 484,674 before the hurricane). The majority of that gain—80 percent, according to some estimates—represents returning residents. The recovery has occurred throughout the city, with half of its neighborhoods reaching 90 percent of their pre-Katrina figures as of June. But growth has been concentrated along the Mississippi River—the highest ground and the most favored real estate in the flood-prone city—as well as in the Central Business District and in Mid-City, where a $2-billion hospital complex is expected to attract even more residents in the next few years. Developers have responded to the influx by building new multi-unit housing. Though some projects include designated affordable apartments, the majority are market-rate.
 
As housing costs rise in the most in-demand neighborhoods, they threaten to squeeze out low- and moderate-income families and render these areas more economically, racially, and socially homogeneous. Meanwhile, some of the most heavily flood-damaged parts of the city remain in recovery mode—from Katrina and from the decades of poverty, crime, and depopulation that preceded the storm. “What we have is a small, growing city embedded in a larger city that has lost a significant percentage of its population,” says Richard Campanella, a geographer at the city's Tulane University.
 
In the Central Business District, developers have begun converting underused commercial towers into amenity-rich apartment buildings, in addition to constructing new residential structures. One of the most prominent ground-up projects is the South Market District, a $200 million mixed-use development rising on four former parking lots. "By 2010, it was clear that New Orleans was not only recovering but was really being reinvented," says Matthew Schwartz, cofounder and principal at Domain Companies, the project's developer. "With the entrepreneurship movement, film, and other industries, the face of the economy was changing, and we saw a new demand for high-quality multifamily emerging." The first component of the three-phase development, which includes a 209-apartment building with 22,000 square feet of retail space by Humphreys & Partners Architects and a parking garage by Eskew+Dumez+Ripple, is scheduled for completion this month.
 
The pressure for new multi-unit residential buildings has also extended to lower-scale parts of the city. "People want to live in neighborhoods they can walk around," says Wayne Troyer, founder of the New Orleans architecture firm Studio WTA. "They want corner stores and restaurants, and they want their bicycles to be their primary means of transportation." Troyer's firm recently completed a market-rate-residential conversion of a former hosiery factory in the historic Marigny neighborhood. Troyer also designed a new six-story apartment building for a site nearby, working with developer Sean Cummings, but it sparked a public outcry about its proposed 75-foot height, and the city council refused to grant a height waiver for the project. The architect and the developer are now working on a new apartment building in the Bywater near the first completed phase of Crescent Park, a promenade along the Mississippi River levee. "New Orleans is in the quality-of-life business," says Cummings, "and there is really no richer, more joyful quality of life than what exists in these historic neighborhoods."
 
But quality of life comes at a premium. Even though the population is still below its pre-Katrina level, the median rent in the city rose by 25 percent between 2004 and 2012'from $688 to $861 per month on existing leases'and the percentage of renters who spend more than 50 percent of their income on housing rose from 24 to 36 percent in the same period. These figures have prevented some locals who left after Katrina from returning, particularly those who lived in public housing. After the hurricane, the Housing Authority of New Orleans negotiated agreements with developers to transform all of the city's public-housing sites—those badly damaged by the storm as well as those that weathered it unscathed—into mixed-income residential neighborhoods. The idea was to replace mismanaged, dangerous projects with modern units that did not isolate poverty. But many saw the move as a cynical land grab, ceding increasingly valuable sites to developers and squeezing out residents with low incomes. (Razing the Lafitte housing projects raised particular ire as they were considered better designed and maintained than others and sustained little hurricane damage.) The city once had 6,000 public-housing units. When the last conversion is complete, the redeveloped sites will have 4,000 low- to moderate-income homes, of which 1,800 will be public housing. Residents left out of the new housing plan were pushed into the federal Section 8 program, where the waiting list, with 13,000 names, has been closed for five years. "We do have a lot of vacant land to develop new housing,' says Gregg Fortner, new director of the housing authority. 'Right now, we are assessing our opportunities. Then comes the hard part: identifying funding."
 
In the meantime, a constellation of groups has taken up the challenge of building affordable housing for many different income levels'from Brad Pitt'backed Make It Right to more grassroots organizations. The Jericho Road Housing Initiative, a nonprofit affiliated with the city's oldest Episcopal church, has acquired 75 vacant parcels and existing houses in Central City, a neighborhood notorious for crime and blighted properties. To date, the group has built 30 houses that it has sold below cost to low- and moderate-income buyers after helping them secure financing. It also has plans to partner with other nonprofits and a for-profit developer to build new rental units among owner-occupied houses. "Most of the single-family rental units in our target neighborhood are substandard," says Jericho Road's executive director, Nicole Barnes. "We want to create homes that will elevate the overall quality and become tipping points for their blocks."

Neal Morris has brought an entrepreneurial strategy to building affordable rental housing with his company Redmellon. "There are an estimated 40,000 vacant houses in New Orleans,' says Morris, who buys empty historic buildings and, with Atlanta-based Kronberg Wall Architects, renovates them using a combination of low-income-housing and historic-preservation tax credits, among other incentives. "I always say, I don't build housing for a living—I layer subsidies," he says. Morris makes the enterprise profitable by working in batches of 40 or so houses at a time, and he manages the completed portfolio, currently 300 rental units, through a separate company. The houses are primarily in desirable neighborhoods near the river, and the subsidies that Redmellon uses require that they remain affordable or low-income rentals for 15 to 35 years.

To make historically blighted but less expensive parts of town better places to live, the New Orleans Redevelopment Authority (NORA) has aimed to facilitate improvements on a neighborhood scale. 'Right after Katrina, we were focused almost exclusively on housing,' says NORA director Jeff Herbert. 'Now we're looking at longer-term transformation projects.' NORA's Lot Next Door Program, for example, helps residents acquire and maintain vacant land adjacent to their homes. The organization also provides financing and grants to jumpstart the revitalization of commercial streets.

To assure that improvement projects do not drive up housing costs, many in New Orleans have called on the city to provide protections for longtime residents. "Our stock of housing, close to jobs and to transportation, has always been a beautiful, historic commodity available to the local population. No one had to compete for it. But now there is a lot of pressure," says Maurice Cox, director of the Tulane School of Architecture's City Center and the former mayor of Charlottesville, Virginia. "I believe public policy can temper the market and protect people, but it's always a game of catch-up."

Rising housing costs are hardly unique to New Orleans, but here they touch on a particular anxiety. The city's culture'from second-line parades to Creole cuisine to historic architecture'is what attracts newcomers. Take away the social and economically diverse groups who maintain those traditions'a possibility made all too conceivable by Katrina's mass displacement'and all that remains are beautiful but empty streetscapes.

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