Land along Nicholson Drive that Lafayette oilman Michael Moreno once hoped to turn into a mixed-unit development called River District is back on the market more than a year after Goldman Sachs Bank seized the 35 acres of property. The asking price: $25 per square foot.
The property consists of more than 38 separate parcels on both sides of Nicholson Drive—according to an offering memorandum prepared by NAI/Latter and Blum brokers Ty Gose and Michael Cashio—including a large, 23-acre tract of undeveloped land on the west side of the thoroughfare.
At $25 per square foot, the price tag is high—nearly 40% more than the $18 per square foot Moreno paid when he acquired the property in the mid-2000s—and roughly equal to the asking price for improved retail pad sites in more commercially viable southeast areas of the parish.
Still, Gose says he’s had good discussions with several interested buyers and even has some letters of intent, though no contracts. He declines to discuss the listed price. He expects the dozens of scattered sites on the east side of Nicholson Drive to be sold to individual investors for any variety of uses. He predicts the 23-acre plot will go to a single user for some sort of planned development.
An ambitious planned development—including entertainment, multifamily, office and retail uses—straddling both sides of Nicholson is what Moreno envisioned for the property when he acquired it in 50 separate transactions totaling $23 million. But many at the time believed he overpaid. Then, the Great Recession hit, throwing the real estate market into a tailspin, followed by a plunge in oil prices, which caused problems for his Lafayette oil business.
In July 2015, Goldman Sachs sued Moreno for defaulting on a $52.4 million loan that, in part, had financed his acquisition of the Nicholson Drive property. It took back the property for $20 million in Feb. 2017.
Local brokers and developers familiar with the area say they see potential for the property one day, but caution it’s early yet. Mike Wampold, owner of several tracts adjacent to the River District property, says he’s not interested in acquiring any more at this time.
“I’m going to let someone else have a chance to do something out there,” he says
Broker Chad Ortte says despite the nearby nascent Water Campus and a handful of pioneers such as 1010 Nic, Tin Roof Brewery and the River House mixed-use development, the Nicholson Corridor has several challenges.
“The property is in the middle of two strong anchors, downtown and LSU, that are both growing,” he says. “However I think the property is at least 10 years away from seeing a real need or demand for high density mixed-use development. Development is driven by demand and happens with available financing and I don’t see a demand or the growing population for the River District yet.”
