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When Business Report launched 25 years ago, it wasn’t a shining time for the Baton Rouge real estate industry.

The market was hit hard by factors on the national and local level. When oil dropped to $10 a barrel, the economy of South Louisiana collapsed. At the same time, developers were coping with high interest rates the Federal Reserve put down in an effort to control runaway inflation.

Rodolfo Aguilar, a real estate consultant who owns several companies and is a Tulane University professor, recalls the prime interest rate was 21.5%. “Real estate development was shut down,” he says.

Things didn’t get much easier the first few years the magazine was around. A tax reform package passed by Congress in 1986 wiped out depreciation deductions and tax shelters, the same factors that drove the buildup of the office market in the late 1970s. “There was a tremendous depression in real estate, the worst I had ever seen,” Aguilar says.

But the Baton Rouge market powered through the tough times because of the solid employment core made up of state government, the petrochemical industry and the higher education system.

“Because of the stability of Baton Rouge, it was always a place that companies looked to,” says Ben Johnson, who recently stepped down as director of commercial sales and leasing for NAI/Latter & Blum to rejoin the firm’s sales team. “Companies wanted to have a primary or satellite office here.”

The record-low interest rates of the 1990s and a booming national economy helped spur development throughout the city. This transformed areas such as Siegen Lane, which went from being a two-lane road marked with potholes into a major commercial thoroughfare.

“That’s been the biggest thing for me, the development of all the big retailers,” says Mike Falgoust of Sealy & Falgoust Real Estate. “When you’re talking about $200 million projects like Perkins Rowe, that’s big.”

These developments and the growth of the city have driven up real estate prices dramatically. In the past 10 years, home prices have gone from $60 to $80 a square foot to $150 to $200 a square foot. At the same time, the cost of land has tripled or quadrupled in most cases. Falgoust says one extreme example is the recent sale of a 17.7-acre tract at Bluebonnet Boulevard and Burbank Drive. It was sold this summer for $3.9 million; when Falgoust had the listing in the 1980s, the price was about $275,000.

Aguilar says large developments such as the Mall of Louisiana and Perkins Rowe have proven that big can be beautiful. “The quality of architecture has improved tremendously, both for commercial and residential,” he says. “There’s been a lot of improvement in the quality of design.”

Design quality isn’t the only thing that has improved in the past 25 years. Technological advancements have transformed the real estate market both locally and nationwide.

Falgoust says he got his first mobile phone nearly 20 years ago, but it was a far cry from the cell phones that fit comfortably in a shirt pocket or purse.

“In 1986 or 1987, when I got a car phone, it was attached to the floorboard of your car,” he says. “When it started ringing, you had to go to your car. It was a big old thing with a cord on it and an antenna.”

Now agents with PDAs and laptop computers with wireless Internet are capable of doing work anywhere anytime. With online databases, potential investors from all over the world can hunt for properties, while local agents can check out far-flung markets. Falgoust used to say he would pay the commission for any agent who sold a piece of property without seeing it in person. Those days have long passed.

“Now, we have cases where we go through a transaction and the agent never meets the buyer or the seller,” he says. “That’s far removed from how I was trained in the business.”

A steady stream of mergers involving some of the major players who built and sold Baton Rouge also changed the market. C.J. Brown acquired Jay Crow and Associates in 1990. Four years later, Latter & Blum bought the local giant. Burns & Company purchased Dot Craig Realtors in 1998. Gully & Phelps is now part of Coldwell Banker.

“Bigger has proven to be better from an operating point of view,” Johnson says.

Falgoust notes C.J. Brown gave a start to major developers such as Charlie Cole, Tommy Spinosa and Mike Wampold. He says the people who will lead the local real estate market in the future are already in Baton Rouge, toiling in the industry.

“I don’t know where the next young guys are today, but they’re in the market and doing stuff,” Falgoust says. “This business today is in the hands of the 20-somethings who embraced all this technology we had to deal with in the middle of our careers.”