(The World Ministry Center on the sprawling Jimmy Swaggart Ministries campus off Bluebonnet Boulevard. Photography by Don Kadair.)
The early 2000s were bleak years for the Rev. Jimmy Swaggart and Jimmy Swaggart Minisitries. Over the previous decade, Swaggart had seen his televangelism empire crumble—the result of a pair of high-profile prostitution scandals—while attendance at the Family Worship Center Church had plummeted. Enrollment at the World Evangelism Bible College & Seminary had also dwindled, and a lot of space sat vacant on the ministries’ sprawling 200-acre campus on Bluebonnet Boulevard.
As a way to make up for some of the revenue that had dropped off with the ministry’s followers, Swaggart sold some property, leased some buildings and even converted a dormitory built for the bible college into apartments. So when a group of local investors approached him about optioning some land to develop a medical complex with an LSU-run charity hospital as its centerpiece, Swaggart was game.
As envisioned by the investor group, Health Science Park LLC, the hospital would be a replacement for the aging Earl K. Long charity hospital in north Baton Rouge—which has since closed—and would attract clinics and even, perhaps, a satellite LSU medical school. Swaggart agreed to the deal and on Nov. 5, 2004, HSP signed a $6.7 million option agreement with FWCC for 60 acres of undeveloped land—about 44 acres of which are usable—on the eastern side of the campus. Also part of the deal was a 50-year lease on two office buildings totaling some 135,000 square feet on the western side of the campus.
Less than 10 months later, Hurricane Katrina slammed into the Gulf Coast, forever changing the Louisiana landscape and the local economy. Baton Rouge real estate prices skyrocketed, as nearly 100,000 New Orleans-area residents flocked to the Capital Region and began leasing or buying up every bit of housing and office space they could find.
Almost immediately, Swaggart’s FWCC started crawfishing on its agreement with HSP. The dispute began when HSP tried to show one of the office buildings it had leased from FWCC to a displaced New Orleans law firm and the ministry wouldn’t let HSP onto the property. It went downhill from there. HSP filed suit, which FWCC quickly settled. But then FWCC filed another suit. HSP countersued. The legal battle would drag on for more than 10 years, filling volumes of court records and running up hundreds of thousands of dollars in legal bills.
Earlier this year, the cased finally went to trial. After eight days of testimony, a jury took just 90 minutes to decide the case in favor of HSP, awarding the developers the right to buy the property—recently appraised at more than $20 million—at the pre-Katrina price of $6.7 million, plus $3 million in damages.
Whether Swaggart will appeal the verdict and further prolong a resolution remains to be seen. Both Swaggart and his New Orleans-based attorney, Stewart Niles, decline to comment. Regardless, the jury’s decision closes one chapter in the saga over the land and opens another—one with intriguing possibilities for a highly desirable piece of property in a busy corner of a parish rapidly running out of undeveloped land.
“The potential is tremendous. That’s why they’ve been fighting over this for so long,” says Richard Carmouche, who is developing the mixed-use developments Willow Grove and The High Grove to the east of Swaggart’s campus. “When I started working on the zoning for Willow Grove, everybody called this area the suburbs. Now, it’s the busiest commercial corridor in the parish.”
A SIMPLE QUESTION
The trial, which stretched over two weeks in late January and early February before Judge William Morvant in the 19th Judicial District Court, was one of the more interesting business litigation cases in recent memory. The witness list read like a who’s who of the local real estate community. Almost every appraiser in Baton Rouge was either deposed or listed as an expert witness, and the names of prominent developers Mike Wampold and Tommy Spinosa were sprinkled throughout testimony.
Two well-known economists and long-time colleagues, Loren Scott and Jim Richardson, also figured in the trial. Curiously, they were pitted against each other as expert witnesses for the opposing sides. Swaggart’s team hired Scott to discredit a report from Richardson, who had testified for HSP about the increase in land values over the past decade and why the investor group should be entitled to damages.
And then there was Swaggart, who turned 81 on March 15 and is visibly grayed since his days of televangelism fame, but is still an imposing figure with a commanding presence. He attended the proceedings daily with his wife of 63 years, Frances, at his side. They sat in the second row of the courtroom, stern-faced and silent, heightening the tension between the two sides.
The arguments were long, the issues complex. But at its heart, the case boiled down, rather simply, to whether HSP had the right to exercise its option agreement on the land. Central to Swaggart’s case was his claim that the agreement was only valid if the property was developed to include an LSU-run charity hospital, something, Niles told the jury in his opening statement, that meant a lot to Swaggart and his ministry.
“To have an LSU project across from the ministry was in keeping with the mission of the church,” Niles said. “The ministry was interested in this because it was consistent with their mission around the world.”
HSP attorney Claude Reynaud, however, argued that while an earlier option agreement tied the deal exclusively to LSU, the agreement signed on Nov. 5, 2004, had no such restriction. The exclusivity clause had been removed from the second option agreement because Swaggart had demanded money from HSP. The group had agreed to pay him $150,000 but once it had skin in the game, it wanted security in the event the LSU deal didn’t work out. The ministry had said OK and deposited HSP’s $150,000 check.
“I can show you the agreement,” Reynaud told the jury. “Then all of a sudden, the ministry didn’t like that deal and they started trying to do everything it could to take us out of the option. All of a sudden, after Katrina, the contract had to be restricted to LSU again.”
Closing arguments lasted more than four hours. Deliberations took less than two. Not only did the jury zip through the nine counts with which it was charged, but jurors agreed unanimously on each one. Terry Jones and Stephen Jones, the front men and developers for HSP, were elated.
“This has been a huge emotional thing for me,” says Terry Jones, who is not related to Stephen Jones. “It impacted me and my family because I had to pour so much time into it. I had one investor tell me to get out, give up, drop out. But I said no. This is not right. I’m not giving up.”
‘A COMPLETE OBSTRUCTIONIST’
Among the intriguing questions surrounding the case is why it dragged on for so long. Reynaud says it’s not unusual for complex, corporate litigation to last for years, noting that “finality is not something I see everyday in what I do.”
That may be, but Movant ruled on a motion for summary judgment in this case in early 2006, awarding HSP the right to option the land. The ruling could have ended the case then. But FWCC appealed, and the state First Circuit Court of Appeal sent the case back to Morvant, saying the ministry was entitled to a jury trial on the matter.
It would be more than nine years before the trial was held. Reynaud attributes the snail’s pace of progress primarily to Swaggart’s legal team, which fought HSP every step of the way. They fought over deposing witnesses. They fought attempts to set a trial date. New motions over new issues kept cropping up. Reynaud, in closing arguments to the jury, likened the whole ordeal to the carnival game of whack-a-mole.
“It has been one excuse after another for 10 years,” he said.
Those who have dealt with Swaggart on other legal issues aren’t surprised, though. They say that’s the modus operandi of the Ferriday-born preacher, who was an aspiring prize fighter in his youth. He’s notoriously litigious and, once embroiled in a lawsuit, notoriously stubborn. Attorney Mary Olive Pierson battled him in a 2003 case on behalf of her client, Tiger Billboards. Though the dispute was ultimately settled, Pierson says it wasn’t easy.
“Jimmy Swaggart is a complete obstructionist,” Pierson says. “He will fight until the death, even if that means he’ll be dead at the end.”
The case against HSP may be a particularly egregious example of that stubborn streak, but it is not particularly unique in Swaggart’s history.
“He does not believe he has to live up to any agreement he makes, written, oral, certified or recorded,” Pierson says. “He is all about Jimmy Swaggart.”
There’s one factor in this case, however, that might motivate Swaggart to hasten, or even forego, a lengthy appeal. Interest is accruing at a rate of about $300 per day on the $3 million in damages HSP was awarded by the jury. So far, the estimated total on the interest has exceeded $1.5 million, which would put the total damages award to more than $4.5 million.
That won’t come out of Swaggart’s pocket, mind you, because he still gets $6.7 million for the property HSP won the right to purchase from him. But it does come out of the purchase price, which means HSP, in theory, could walk away with 60 acres of undeveloped land just off Bluebonnet Boulevard for around $2.2 million—and possibly even less if additional interest racks up.
‘THE WORLD HAS CHANGED’
While the case wends its way through the appellate process, Jones and Jones say they’re laying the groundwork for the development they’ve been hoping to create for more than a decade. All but two of HSP’s original 22 investors remain on board, and they say money is still there to do some sort of mixed-use project with health care as the central component.
Would they consider selling the land? They say no.
“Our vision is to build something that is a real light for the region,” Terry Jones says. “We want to create something that helps this region and helps this city shine.”
Hiring a planner is the first step. HSP’s original plan for an LSU-run charity hospital to replace Earl K. Long is no longer a possibility because of LSU’s partnership with Our Lady of the Lake, which went into effect in 2013. But Steve Jones suggests the site could house a Baton Rouge campus of the LSU medical school, a goal articulated in recent land-use plans for Baton Rouge. There are also opportunities for clinics and medical office buildings. It’s exciting for the partners, but also a major undertaking that, if it happens at all, won’t occur any time soon.
“We have to do a market analysis, a study, figure out the physical layout, the utility layout, we’ve got to go sit down with the city and find out what’s the sewerage capacity if we do this, what’s the water capacity if we do this?” Steve Jones explains. “That alone could take 12 months, and then everybody else is planning their stuff. [OLOL’s] Children’s Hospital is going in. The General is doing their plan. The Lake is doing things. How does that dovetail together?”
While there are synergies to explore, there are opportunities today that didn’t exist more than 10 years ago when this all began. In the years the land has been tied up in court, Bluebonnet Boulevard has mushroomed as a corridor of commercial and retail activity. When negotiations between HSP and the FWCC began, there was no Perkins Rowe, no Renaissance Hotel, no Willow Grove or The High Grove.
“Actually, when we got started at Willow Grove, Perkins Road was still a two-lane road,” Carmouche says. “The world has changed in the last 10 years.”
Part of that change is the creation of the Baton Rouge Health District, a delineated medical corridor bordered by Bluebonnet, Perkins Road, Essen Lane and Interstate 10, where most of the parish’s medical institutions are located. Swaggart’s campus and the 60-acre tract is smack in the center of it all. Though the health district branding effort has only recently begun, it will have a significant impact on the area, not the least of which is the creation of a new road connecting Perkins Road and the Mall of Louisiana that is planned to run in front of the disputed property.
“Once they put that road through there it is going to be highly desirable,” says Wampold, who was interested in acquiring the 60-acre parcel himself in the early 2000s and eventually bought the building that would become the Renaissance Hotel from Swaggart. “Obviously, I drink the Kool-Aid out there, and I think it’s the epicenter of growth in Baton Rouge.”
WHAT TO BUILD?
Wampold believes the best use for the 60 acres lies in the medical or health care-related sectors. He says the area doesn’t need any more hotels, though he obviously has a vested interested in saying so. He already owns two hotels on Bluebonnet and has plans to build another one on an undeveloped parcel in Perkins Rowe. He also believes the multifamily market is nearing a saturation point in the area.
“Perkins Rowe has new apartments coming online and Carmouche’s development has apartments being built, so do you need any in between?” Wampold wonders. “I’d be careful about that. You have plenty of retail/lifestyle stuff and with Baton Rouge General now talking about developing some of its property into mixed-use, you can only have so many lifestyle centers.”
Others see retail options as a possibility. Developer Ed Kramer agrees a medical or health care-related development is an apt use for the property. But he adds national retailers are looking for space in this market and that the property, once the new connecter road from Perkins to the Mall of Louisiana is complete, could be developed into storefronts.
“I know there are a lot of national retailers that would like to get in Baton Rouge, but they want to be in the proper location,” he says. “They want a high trafficked area with visibility. There aren’t a lot of places that have the traffic count and the visibility and are still available. I think a lot of people would sign up for that location if it were available to them.”
Carmouche agrees the area is flush with new inventory in the multifamily sector and thinks HSP should focus on retail, health care or office developments. But he also notes that by the time HSP is ready to develop the land, market dynamics could have changed yet again.
“These things take forever to put together,” he says, “so you don’t really know what the market will be doing by then.”
There’s still a long road ahead for HSP. But after more than 10 years, the recent verdict offers light at the end of a tunnel they’ve been waiting to see for a long time, and they’re feeling optimistic—at least more optimistic than at any other time in the years they’ve been fighting with Swaggart.
As Reynaud says: “It’s better to be here than where we were before.”