Tuesday, August 14, 2007

Cashing In on Katrina in Tuscaloosa

We now know one reason for the condo boom in Tuscaloosa, and if you have a million dollars stuffed in that shirt pocket and don't know what to do with it, we have a tax break for you.

After Katrina devastated a sizable portion of the Southeast in 2005, Congress approved the Gulf Opportunity Zone Act. This bill contained a variety of tax breaks designed to stimulate construction in Mississippi, Louisiana and Alabama and offered tax-free bonds to developers to finance big commercial projects like shopping centers or hotels.

And condos.

In Tuscaloosa, about 10 condominium projects are going up, several near Alabama's Bryant-Denny Stadium. Builders are asking up to $1 million for units with granite countertops, king-size bathtubs and Bama decor, including crimson couches and Bear Bryant wall art. One of the projects is said to be The Traditions.

Buyers, many of whom are Crimson Tide alumni or ardent football fans not entitled to any special Katrina-related tax breaks, are lining up. So are real estate investors who are purchasing the condos with plans to rent them out.

While all of this is perfectly legal, the people who were hardest hit by Katrina are seeing little if any impact from the Gulf Opportunity Zone Act.

Even the Alabama site The Legend of "Bully" Van De Graaff is critical of what is happening in T-Town:

"Whether the University of Alabama likes it or not, their fingerprints are all over this because of the location of these condos. For a school that is attempting to shed the moniker of 'cheater', this will not change anybody’s mind."

Losers With Socks also pointed out that in June, authorities suspected someone intentionally killed a row of live oak trees that stood between Bryant-Denny and The Legends, a new condo development with prices starting around $360,000

Thanks to Tom and Mike for the tips.


gerry dorsey said...

although it is an exremely shady/sleazy way for a bunch of rich dudes to get even richer, i really don't have a huge problem with this. it would piss me off if i thought these guys were doing this INSTEAD of helping out truly devastated areas, but it's not. to hopefully give my opinion some value, my hometown of slidell is mentioned in the article as being a hard hit area. my mom was living in slidell at the time of katrina and now lives in tuscaloosa.

DickieVegas said...

I have to say I am in agreement with you. I live in MS, and Jackson (150 miles inland) was not hit with a fraction of the devastation as the MS Gulf Coast. Yet, developers in the area did receive go zone funding. And it has been a postive. Do we really trust our federal government to oversee the rebuilding effort? I say no. While there has probably been a lot of abuse, there is government money which is being spent on a lot of less worthy efforts. Just for the record, I am not referring to the war necessarily. Also, I moved to Gulfport for 6 months after Katrina (from central MS), so I am all too familiar with Katrina's effects as well.