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SHAME OF THE CITIES:
Gentrification in the New Urban America

by Kari Lydersen
03.15.99

WHEN DAVID ARAGON WAS YOUNG, his family lived in the working-class Mexican and Italian Taylor Street neighborhood in Chicago, just west of downtown. Then the University of Illinois at Chicago was built, and Aragon’s neighborhood was destroyed to make room for university buildings and more upscale restaurants and apartments serving the students and faculty. His family took refuge in Pilsen, a neighborhood slightly further west and south, which had long been a haven for working-class immigrants and became largely Mexican in the ‘60s and ‘70s.

Today, Aragon is experiencing deja vu. His neighborhood is once again in mortal danger, with the university having decided the area is a perfect place for more student and faculty apartments and the city set on redeveloping the area by providing subsidies to developers marketing lofts to higher-income professionals. "They’re pushing poor people out of the city and in the process breaking up the power bases of their struggle," he says. "It’s gentrification, but you could also almost call it apartheid by both race and class."

All over the country, the cycle of gentrification is displacing lower-income residents. In most American cities, as sociologist William Julius Wilson has argued, de-industrialization and the ascendancy of the information age have inverted traditional structures of urban life. With most factory jobs shipped abroad or lost to automation, professional white-collar jobs and low-paid service jobs with few benefits are taking their place. Meanwhile, white-collar workers eager for convenience and a happening neighborhood are flocking back to the central cities.

The poor have very little political or economic defense against developers who want to buy up their crumbling apartments and rehab them into luxury condos and lofts, and city and state governments are only too pleased to ease the way for this transition. They do all they can to weaken rent-control laws, tear down public housing and subsidize higher-level developers.

Many pessimistic community activists and urban scholars see only two possible eventual outcomes to the gentrification situation: either the market will become saturated and run out of people to fill expensive housing, or all the poor and the majority of non-white people will be driven out to far-flung neighborhoods and suburbs collaring the city, out of sight and mind. But other community leaders say it is possible to redevelop and improve a neighborhood without driving existing residents away. They are determined to hold on to at least a fraction of valuable land for the less-fortunate. Through protests, lobbying, organizing, legal clinics, tenant buyouts and support from socially-conscious non-profit developers, activists have won some major victories against gentrification from New York to San Francisco.

But they can’t totally prevent what amounts to the largest makeover of urban America in decades. For instance, San Francisco, long a refuge for all kinds of huddled masses, has lately become one of the least welcoming cities in America for neo-Bohemians and immigrant families. It has become almost completely gentrified, with only a few pockets of the city available to the poor and lower-income. A recent ranking found it to have the highest housing costs in the country.

Now even those neighborhoods are on the verge of being obliterated. In the past three years, more than 1,000 low-cost housing units and 2,000 public housing units have been demolished and 1,600 rental units went condo. Over 8,000 residents lost their homes through eviction. The majority of them were either forced to leave the city or to join its burgeoning homeless population, which is estimated at 10,000 and growing. The paper also reported that since 1995 dozens of local businesses have been driven out, replaced by national chain stores.

San Francisco’s mostly Latino Mission neighborhood has long been a mix of working-class and poor people, as well as young white bohemians. Spanish was the primary language spoken there. Now, as one activist describes it, the Mission is "the epicenter of trendy martini bars, high-priced restaurants and vintage clothing boutiques." It has suffered the city’s highest number of evictions, with Latinos and seniors on fixed incomes hit especially hard. Moreover, the neighborhood has become the center of an intense drug trade catering mostly to young whites. English has replaced Spanish as the neighborhood language, according to Ted Gullickson of the San Francisco Tenants Union. A recent newspaper article stated that less than a third of the people who lived in the Mission in 1990 could afford the rent now.

New York faces a similar situation. Gentrification has made New York look less like a melting pot and more like a pot of oil and water, where people with varying wallet thicknesses never mix. "Twenty years ago the Upper West Side was very mixed-income," said Evan Hess of the Northern Manhattan Improvement Corporation. "On the same block you could have found a judge and the criminal who was facing him. You wouldn’t see that today."

Low-income people fleeing New York won’t find any relief in Boston, which has traditionally been another port of entry for immigrants. As in New York, Massachusetts lawmakers have attacked rent control in pursuit of development. "Landlords know what the business is like," said Carlos Rosales of the Massachusetts Tenants Organization in Boston. "They raise the rents so the people move to another community, then they raise the rents there. In some cases, rents are increased 200 percent."

In the previously affordable Jamaica Plain neighborhood, rents have increased more than 20 percent—up to an average $812 for a one-bedroom apartment—and housing prices have increased 40 percent over the past few years. Latinos and the elderly have been forced out in droves by these increases. "There’s a huge increase in the number of white people and high-income people in the city," says Jamaica Plain activist Kathy Brown. "It’s happening because the traditional residents are being forced out of the communities. It’s wonderful to bring economic vitality to a neighborhood, but you need to keep the original residents there."

As in San Francisco, the natural beauty and cultural cache of Portland, Oregon make it a highly desirable place to live. It’s also a place where non-affluent people are finding it less and less possible to live. Portland is second behind San Francisco in cost of housing this year. Rents in the previously affordable Northeast and Southeast neighborhoods are increasing 100 percent or more per year, according to Dana Brown of the Portland-based Community Alliance of Tenants, the only tenants’ organization in the state. The large African-American population of Portland’s eastern neighborhoods is quickly shrinking. They’re being driven out to far-flung suburbs where Brown says the population of minorities has recently risen up to 200 percent. Rent control is outlawed by the state of Oregon, and evictions are snowballing in Portland, aided by a "no cause" eviction law where even the perfect tenant can be evicted if the landlord wants someone who can pay more.

Seattle was used by the media as a national case study in gentrification in the late ‘70s and early ‘80s. John Fox of the Seattle Anti-Displacement Coalition says that the face of the city has been changed by the loss of affordable apartments and SROs, huge subsidies for "big-ticket" development projects and the destruction of public housing. Housing prices are so high that 35,000 of the city’s 220,000 households are paying more than half their income toward rent; a ratio at which a family is statistically considered "at risk for homelessness."

"In Seattle, almost every neighborhood has been gentrified and the (former residents) forced into the suburbs or crowded into pockets of poverty," Fox says. "We’re following in the steps of San Francisco."

The Anatomy of Gentrification

Gentrification has a long history. In the mid and late 1800s, powerbrokers in many European cities tried their hands at urban planning. In Paris, Baron Georges Eugene Haussmann, a court crony of Napoleon the Third’s, gutted the residential areas where poor people lived throughout central Paris and installed the city’s famous grand boulevards. Thousands of poor Parisians were displaced to make room for the sweeping tree-lined boulevards which show-cased the city’s famous monuments. Strict guidelines applied to new building along the boulevards, and the residences there became the most exclusive in the city.

The process became part of the American public consciousness in the late ‘70s and early ‘80s in the U.S., when artists and bohemians started moving into inner city buildings which had previously been warehouses and factories. But, says Larry Bennett, a political science professor at DePaul University, it was still a stretch and it took a concerted marketing effort to sell these areas to yuppies.

"Lofts are great for artists because they have all this room to put up canvases and paint ‘til they’re black and blue," he said. "But back then the average person didn’t want to live next to a factory or in a factory. To sell a loft to someone who wanted to put in vases and a quality kitchen was a bigger job." This early gentrification didn’t actually displace people, but it opened the way for the inner city to be viewed as a desirable place to live. It wouldn’t be long before the residential neighborhoods right outside the center of the city were feeling the pressure. But even now, Bennett thinks displacement is not the most immediate effect of gentrification. Equally harmful, he says, is the diversion of resources from poor areas to neighboring wealthy areas. Especially with "urban renewal" programs such as tax increment financing zones—TIFs—which allow tax dollars to be pooled from one neighborhood to another, he says infrastructure, parks and schools in poor areas are ignored in order to free up resources for rich neighborhoods.

There are several essential elements necessary to create a gentrification situation, according to Nacho Gonzalez, a University of Illinois at Chicago professor who is working on a study on gentrification in West Town, a Chicago neighborhood. One element is a "gentrification industry,"—realtors, developers, mortgage lenders, and construction companies eager to capitalize in the area. The second is a neighborhood with an attractive location and housing stock, preferably a disinvested area with run-down but attractive architecture ripe for rehabbing. The third necessity is a population of low-income people inhabiting the area with little political or economic power to fight for their territory. Closing the ring are people with disposable income looking to move into the area, usually young, childless professionals seeking location and action.

Low-income artists often unintentionally form the bridge from the original low-income community to the yuppies. "Artists like certain kinds of buildings, big spaces and lofts with stimulating architecture," says Gonzalez. "They bring in galleries, cafes, rock clubs and a certain night life, which attracts the gentrifiers." Gonzalez says that at a certain point he thinks the loft and studio market will become saturated—"How many yuppies can there be?" He also thinks the displacement that occurs with gentrification isn’t a wholly unnatural process. With the deindustrialization of inner cities, many working-class people actually have jobs farther out in the suburbs and for that reason would leave their central neighborhoods anyway. The elderly are the true victims of gentrification, he notes. They are quickly displaced when property values go up. Even if they own homes, their meager fixed incomes may prevent them from affording increased property taxes. Suddenly they find themselves thrown into unfamiliar neighborhoods, cut off from their social support systems, and often far from medical facilities and shopping.

Larry Bennett notes that mayors and city officials eager for gentrification often seize on huge areas of inner- city property owned by railroads or manufacturing companies and buy it to let developers build fancy, often gated, planned developments. "[Unused inner-city land masses] are like manna from heaven for Daley or [New York Mayor Rudy] Giuliani," he said. "They can bring in that critical mass of upper-class people who will wear nice clothes and subscribe to the symphony and go to theaters and art museums. They want to Parisianize the downtowns."

The Changing of the Guard

Young people moving into cities look for cheap housing and are willing or even eager to live in a gritty area with substandard housing stock and high crime. They crave the ethnic diversity and stimulation of a "real" neighborhood, and soon they have started and attracted galleries, clubs, cafes and thrift shops and have formed a vibrant night life and cultural scene. Because they are largely from higher income backgrounds, are educated and mostly white, these pioneers make the area less threatening to the average higher-income yuppie.

Greenwich Village could be the case study for this phenomenon. In the ‘40s and ‘50s it was the cheap and seedy realm of the beatniks; today it costs more than $1200 a month to rent a one-bedroom apartment. Other New York neighborhoods followed in the Village’s tracks—Soho, and more recently, the lower East Side and Williamsburg.

In Chicago, the near north side neighborhood of Wicker Park has gentrified dramatically over the past five years after becoming the city’s hot "artsy" neighborhood. In the 1980s, Wicker Park was a Latino and Eastern European working-class neighborhood, whose seediness was memorialized in the work of Nelson Algren. It was filled with cheap Mexican restaurants, furniture stores and dollar stores, and prostitution and drug dealing were common.

Then a community of artists moved in to take advantage of the huge loft spaces and homey local bars and diners. Gradually, their slacker’s paradise disappeared. Urbis Orbis, a spacious cafe which was popular with the early artists and writers, was recently priced out when it could no longer afford the rent. The Flat Iron building at the corner of North, Milwaukee and Damen, once a bohemian refuge where artists could slide by rent-free for months, was taken over by corporate realtors who systematically harassed their tenants and jacked their rents up with no notice, hoping to clear the building for wealthier renters. Today, the three-flats on the tree-lined side streets of Wicker Park go for $500,000. Chic restaurants with $24 meals and glitzy night clubs with $10 cover charges line the main drags.

Dana Brown mentions a North Portland area called Alberta Street which "used to be very depressed, mainly boarded up buildings and lots of prostitution and drug deals. Now it’s chez Alberta, with lofts and bistros." She notes that the area, in the early stages of the "hipness" transition, is still pleasantly diverse, with lots of gay and lesbian and African-American-owned businesses. "But still," Brown said, "The original residents aren’t part of it."

The Jamaica Plain neighborhood in Boston is another example. Until a few years ago, it was one of the few integrated and open-minded neighborhoods in the city, but now rising property values are turning it into another yuppie haven. "Boston’s always been pretty segregated, but Jamaica Plain has always been the funky, diverse, cool place," says Kathy Brown of City Life/Vida Urbana, a local community and activist group. "But if something isn’t done soon it won’t be too funky or diverse anymore. The politicians are supposed to be progressive, but they should put their politics into their real estate practices."

She says it’s common not to have a year-long lease in Jamaica Plain, so many residents are getting "outrageous" rent increases month by month. In a way, many of them are victims of their own hard work and organization. "In the late ‘80s we did a lot of work to stabilize the neighborhood, getting banks to come in, fighting crime, promoting homeownership. Now it’s a really great area, but the people who made it that way are getting pushed out."

Public Housing

In many cities, decrepit public housing projects stand on some of the most valuable land. In other areas, project-based Section 8 (scattered site public housing) units are earmarked for low-income residents, but landlords are realizing they could be getting astronomically higher rents for these structures. Thanks to original ill-conceived plans and shameful maintenance, much public housing is now virtually unlivable.

Now federal and state agencies are removing large public housing projects in every major city. The majority of residents are given Section 8 vouchers and sent into the open market to find an affordable apartment. Yet the federal government has also passed legislation that spells the near-total dismantling of project-based Section 8 housing. Developers previously got low-interest mortgages to build apartments for Section 8 housing, with the tenants paying a third of their income toward rent and the government picking up the slack. But recently, landlords have been allowed to buy out their 40-year mortgages early, get rid of Section 8 tenants, and raise the rents to fit the market. If they don’ t do this, there are always other means they can use.

"We’re afraid that local HUD offices will start enforcing quality standards on Section 8 buildings real strictly in valuable areas," says Mike Foley of the Cleveland Tenants Union. "The buildings won’t be up to code so they’ll lose the Section 8, then they’ll be demolished or rehabbed for market rate housing."

In Los Angeles, low-income housing advocates fear that the demise of project-based Section 8 housing will be catastrophic. Already, L.A. has had 30 landlords buy out of Section 8 mortgages since the law went into effect. "Venice is one of the last places in the country where low-income people can live by the beach," said Larry Gross of the Coalition for Economic Survival in L.A. "We’re just barely holding on to HUD-assisted housing there. But soon it will all be over and become condo conversions. In general it’s a bleak picture. The policies that have been enacted and the direction we’re heading seem to spell disaster for low-income people."

People displaced from public housing and Section 8 will add even more strain to the already tight affordable-housing markets. And their displacement from gentrifiable areas will doubly help the gentrifiers. Not only have Section 8 and public-housing units been cleared for market rate units, but the removal of the undesirable poor residents will instantly make the neighborhood "better" and more attractive to wealthy residents.

The racial element of the dismantling of public housing is impossible to ignore. Public housing activists charge that, with the vast majority of public housing residents being black and Latino, their high concentration in valuable areas is too much for city officials and developers to bear. As public housing disappears, these minority residents are scattered.

Rent Control Attacked

Where it's existed, rent control has long been one of the best friends of a low-income tenant. Preventing the landlord from increasing rent past a small cost-of-living increase each year, rent control allows low-income people, especially the elderly and disabled and others on fixed incomes, to stay in the same apartment for years no matter how ritzy the surrounding neighborhood becomes.

Landlords and developers hate rent control for obvious reasons, as it forces them to keep renting apartments for literally as little as one-fifth what they could get for it. Rent control (and "rent stabilization laws") have suffered some vicious setbacks in the past few years. In Boston, rent control was ended in a state referendum four years ago. Even though rent control only existed in three Massachusetts cities; Boston, Cambridge and Brookline, real estate interests pushed lawmakers to put the anti-rent control on a state bill and lobbied heavily for it after it failed to pass on the city level.

"The real estate industry spent over a million dollars to get it passed," says Kathy Brown. "Now there's no protection on rents. Landlords are doing whatever they want to do."

She notes that a lot of elderly people, formerly protected by rent control, have been forced out of the Fenway Park neighborhood as more students and young people move into the trendy area surrounding the famous ballpark. Boston's rent control was phased out by income level over the past years, with the final phases basically complete now. "The last two years have been terrible," says Rosales. "We've seen a lot of people forced out, especially seniors who'd been living in the same building for years. People can't afford rents and don't have anywhere to go but the shelters. There are a lot more homeless people."

New York has also substantially weakened rent control by releasing vacated apartments from the agreement. This perversely gives landlords extreme personal motivation to evict people, because once an eviction causes a vacancy they can raise the rent at will. Several legal aid and community groups in Boston and New York said they have seen massive increases in evictions already. Hess notes that the changes in rent control also take away the judge's discretion in postponing an eviction to give the tenant an opportunity to get emergency aid. And he says that welfare emergency aid for rent has been made much harder to get with welfare reform.

"All these laws are dovetailing," says Hess, referring to the attacks on rent control and welfare reform. "What it will mean is more people on the street." Kathleen Crowe of the Tenants Union of the West Side in New York says she thinks rent control and other tenant-rights issues are basically doomed, since tenants don't have the lobbying power to compete with developers and rich landlords. "The governor and his gang want to end all rent control," she says. "The landlords fill their pockets with a lot of nice money. And housing court keeps getting less and less tenant-oriented. They're definitely on the landlord's side." In L.A., which Gross calls "a city built on rent control," state laws passed in the past few years have prevented city governments from having strong tenant-friendly rent control laws. Rent control in L.A. is undergoing a three-year phase-out.

San Francisco also has no protection on vacant apartments, so once a unit is vacated the rent can be raised 300 percent or more before the new rent control kicks in. Landlords have found plenty of creative ways to remove tenants so they can raise the rent or go condo. One popular tactic is fake "owner-move-ins," where a landlord is allowed to evict a tenant so that he can move into the unit, only to stage a move in and move right out, soon to raise the rent or convert the unit into a condo. Gullickson said "owner-move-ins" have mysteriously increased by 300 percent since 1996.

"The landlords are trying to get rid of the low and moderate income tenants so they can be replaced by tenants who are able to pay outrageously high rents," says Gullickson, noting that a two-bedroom apartment going for $800 a month ten years ago would easily go for $2,000 now.

Eshelman says the purportedly progressive Mayor Willie Brown has been no help to tenants in the face of these shenanigans—"he has done nothing [to help them] and has been the major force steamrolling the poor in San Francisco."

Fighting Back:
Development Without Displacement

The machinations of city government around development and gentrification depend on uninformed residents and tenant complacency. In Chicago, meetings and community hearings having to do with gentrification issues are planned in order to keep community involvement to a minimum. Local aldermen usually schedule "community meetings" at which they extol pro-gentrification plans and even plant supporters in the audience to promote the appearance of community support. They attempt to squelch any actual grassroots input into city plans, changing the dates of public meetings without notice and doing whatever else they can to clip their opponents’ wings.

But every major city has at least one non-profit group fighting for housing rights; many cities have a whole list of such organizations, including many all-volunteer, entirely-grassroots ones. Gentrification is a major issue for all of them. In addition, among the heated community meetings addressing gentrification across the country, scattered voices are heard decrying the hard-liners who want no development, no chance of gentrification whatsoever.

Community groups in Boston and New York were able to soften their rent control cuts with provisions for the elderly and other minor anti-gentrification measures, and the City Life/Vida Urbana group even organized a committee of landlords who support affordable housing and oppose gentrification. The Anti-Displacement Project in Springfield, MA has also been successful in passing pro-tenant legislation. One demonstration included 40 low-income residents surrounding a pro-gentrification city hall official with squeaky rubber rats and proclaiming him "Dirty Rat of the Year."

In Chicago, the Organization of the Northeast (ONE) has served as a national model for its work in the Uptown area. Uptown, which studies have shown to be one of the most economically and racially diverse neighborhoods in the country, has long been at risk of gentrification because of its lakefront location. But largely due to the efforts of ONE, it continues to be one of the city’ s more affordable. In fact, according to James Mumm of ONE, ONE has played a direct role in the maintenance of over 4,300 affordable units in Uptown and the nearby Edgewater neighborhood. These units include 11 Section 8 buildings, four of which are members of ONE, and the organizations Lakefront SRO, Harper House and Voice of the People, all of which are ONE members.

One of ONE’s strategies is tenant buyouts, particularly in cases where a landlord is opting out of a government-subsidized mortgage for Section 8 affordable housing. In the early ‘90s, ONE orchestrated the first tenant buyout in the country utilizing the federal Preservation Project program for Section 8 buildings, when low-income residents took over the Carmen Marine apartment building. They have successfully organized tenant buyouts at numerous other buildings which otherwise would probably have gone condo. Like many successful community groups, ONE is a powerful force in the housing market largely because its scope extends well beyond housing.

"We obtain property [through buyouts] which will then remain secure for affordable housing," said ONE organizer Chris Pope. "Then those anchor the community. We work building to building, keeping them from being sold to someone who will throw everyone out. We’re working on a lot by lot survey so we have a sense of what’s happening and we know what will be targeted next."

Joy Aruguete of the Bickerdike Redevelopment Corporation, a Chicago non-profit responsible for creating hundreds of units of secure affordable housing in Pilsen, said the company has sometimes been called "the original gentrifier" and blamed for paving the way for gentrification in the neighborhoods in which they work. But she said people shouldn’t be asked to forfeit quality housing and vibrant businesses in fear of gentrification, and that generally people understand it can be possible to develop a neighborhood without displacement.

"As a community developer, we’re clear that we want our units to go to people who already live in the community," she said. "That’s part of our mission. When the gentrification issue is framed for political purposes and people don’t look at the complexity of it, that hurts everyone."

Virginia Pace of the Holsten Development Corporation in Chicago said that even for-profit companies aren’t always on a mission to gentrify. She said that her company is "very neighborhood based" and has focused on providing affordable housing for over 25 years. The residents of the Cabrini-Green public housing project in Chicago seemed to recognize this: with Cabrini slated for transformation into a controversial "mixed-income community," they chose Holsten as their favored private developer.

"Because we deal with affordable housing, we’re not displacing people," said Pace, the vice president of development. "You do have to make money, but there are ways to do it without displacing people. With low-income housing the returns are smaller than with market rate, but the risks are also more long-term and you have tax credits."

In Chicago’s Pilsen, the gentrification battle has been frustrating, but opponents have enjoyed relative success. The city has been trying to gentrify Pilsen for decades, and so far every major initiative has been beaten down through community pressure. Also, despite noticeable changes in the past five years, Chicago’s West Town can also boast of some triumphs. The West Town Tenants’ United organization has a campaign to help low-income homeowners protest increases in their property taxes. In February, the campaign filed 130 complaints with the assessor’s office, and in every single instance the taxes were subsequently lowered. "I’m very proud to say it’s my neighborhood and I want it to be my kids’ neighborhood too," said Ana Gonzalez, a West Town activist and 25-year resident.

"Everywhere I look they’re building something new, but what good is that if we aren’t here to take advantage of it? This is my neighborhood and I’m here to stay." [ L i P ]

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