Joe Jaeger, vexed by Topgolf proposal, pulls out of controversial Convention Center hotel

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New Orleans developer and hotelier Joe Jaeger announced Saturday that he is withdrawing from the team seeking to build a heavily subsidized and thus controversial hotel at the upriver end of the Ernest N. Morial Convention Center.

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In a letter sent to The Advocate on Saturday, Jaeger said he couldn’t in good conscience continue as a developer of the hotel project at the same time he was criticizing the center’s leadership for other decisions. “It’s only appropriate that I withdraw as a co-developer of the Convention Center’s proposed hotel project in light of my concerns with recent decisions by its leadership,” Jaeger wrote.

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Jaeger complained that the golf-range deal, which has yet to be approved by the center's board, did not go through any bid process. Worse, according to Jaeger, the Convention Center’s leaders several years ago told Topgolf and Drive Shack, a leading competitor, that they were not interested in a driving range at that location.

In the meantime, Jaeger, with several partners, had joined forces with Drive Shack to build a high-end driving range on Howard Avenue at the site of the former Times-Picayune building, where demolition work began recently.

He said this week that the $29 million Drive Shack project — announced a year ago — is likely “dead” in the face of the planned Topgolf project, because there isn’t a big enough market for two such facilities so near one another. The sites are less than three miles apart.

In his letter to The Advocate, Jaeger acknowledged that he is “biased” against the Topgolf plan because of his competing project. But he said his real beef is that he thinks the Topgolf proposal could hinder rather than enhance the development of the rest of the land at the upriver end of the Convention Center.

Jaeger is also a co-owner of the former Market Street Power Plant, immediately upriver from the area to be redeveloped.

An earlier vision for the land now proposed for a driving range called for building workforce housing there, Jaeger said. “I think we can all agree that eliminating workforce housing for a second, new driving range makes no sense,” he wrote.

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Mayor LaToya Cantrell and others argue that the tourism industry — the Morial Convention Center in particular — gets too large a share of the proceeds. Her administration, and several members of the city’s legislative delegation, have been trying to confect a deal to redirect some of that money to help fix the city’s aging and often failing infrastructure.

But tourism leaders have pushed back, and so far, no deal has been reached. The debate has left the proposed hotel project — which would receive about $100 million in direct subsidies, plus other tax breaks — in limbo.

The proposed Omni hotel would have 1,200 rooms. The Bureau of Governmental Research, a critic of the project, has estimated the total value of the subsidies and tax breaks sought for the hotel at $330 million in today's dollars.

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