1-Cent Sales Tax For Magnolia Marketplace Development Moves Forward

by • November 15, 2013 • Development, Retail, Tax CreditsComments (2)1859

On Thursday the New Orleans City Council pushed forward plans to assess an additional 1 percent sales tax on all items sold at the proposed Magnolia Marketplace shopping center under development on Claiborne Avenue.

The money generated from the 1-cent tax would be used to support bonds to pay for public infrastructure improvements and other “extraordinary” construction costs that make New Orleans a more expensive place to build, developers have said.

The Magnolia Economic Development District, bounded by South Claiborne and Washington avenues and Clara and Toledano streets, was created specifically for the $25 million Magnolia Marketplace.  The 98,000-square-foot strip mall will include six national retailers — TJ Maxx, Ross, Michael’s, PetSmart, Shoe Carnival, Ulta cosmetics — and a Raising Cane’s restaurant.  A separate phase of development includes construction of a Capital One bank branch, a T-Mobile retail store and another retail store one block over.

The developers plan to finance the development with $5.5 million in equity, $15 million from bank debt and new market tax credits, and $1.6 million in state Community Development Block Grants from the State of Louisiana.  The city and developers hope shoppers will pick up the remaining $2.3 million through the higher sales tax.  Revenue generated from the tax increase would be used to cover pre-approved public infrastructure costs and extraordinary costs associated with meeting elevation guidelines”.

City officials are touting the benefits of the development, including the tax dollars it will recapture from  Jefferson Parish, the return of a major vacant parcel to commerce, and 217 retails jobs with salaries that pay from $28,000 to $60,000.

Construction on the development is expected to begin in January, and the stores could open in April 2015.

 

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2 Responses to 1-Cent Sales Tax For Magnolia Marketplace Development Moves Forward

  1. […] The Magnolia Marketplace planned for South Claiborne Avenue will open in March 2015 with six national retailers and a fast-food restaurant — TJ Maxx, Ross, Michael’s, PetSmart, Shoe Carnival, Ulta cosmetics and Raising Cane’s. The $25 million project is being financed by a combination of private financing and federal New Market Tax Credits.  The developers had also requested $2.3 million more to close the gap on the major costs associated with replacing the old utility lines on the site.  The developers had proposed a 1-cent sales tax on items sold at the marketplace, which the city council considered it earlier this month. […]

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