If not gentrification—what?

Two weekends ago, I had the pleasure of going to the Guthrie Theater for a reason other than a Vikings Stadium design unveiling. I was there for a performance of Clybourne Park*, which, according to Wikipedia, is a modern response to Lorraine Hansberry’s 1959 play, A Raisin in the Sun. For those who don’t click the links, Clybourne Park is a two act play dealing with 1950s white flight from and 2000s gentrification of a fictional Chicago neighborhood.

Acting was good, plot was a bit predictable if you took more than zero sociology classes in college, and the ending was sad enough to make me feel feelings. There were many opportunities for super gratuitous audience reactions, i.e. audible GASPs and HAHAs at politically-appropriate times, which was a bit much coming from this metro area. Though, to the audience’s credit, when the curtain closed and the lights came back on, it did seem like one of the more integrated groups of people I’ve seen in the same place doing the same thing in a long time.

I wasn’t 100% sure what kind of post I was going to get out of this experience, because there’s really nothing I can say about white flight that you haven’t already heard from a different white liberal–though if it helps, my grandparents stuck around Astoria until well into the late 90s. But, I got lucky! After putting together a collage of different development projects going on in Minneapolis and posting it to UrbanMSP’s Facebook page last week, I struck gentrification gold with the fantastic Facebook comment below. The poster’s name is removed, but for trivia purposes I’ll say that they share their last name with a defunct Milwaukee-based beer company.

Did you look it up??

Did you look it up??

This person is no longer around to defend their post, so I’ll try to avoid much direct criticism and instead compliment their excellent grammar, punctuation, and spelling.

I’ll lead with a question borrowed from an instructor I had in college: Is gentrification a real thing? Obviously, it is, it has a Wikipedia page, but I think starting out with that question is a good way to mentally limber up a bit before getting into some serious thinking. That Wiki page cites some examples from Ancient Rome and Industrial Age London, among others. American inner cities weren’t the first place to experience a changing real estate market. It goes without saying that new construction is going to support higher rents than older construction, barring some sort of government or other market distortion–we’ll talk about that in a bit.

But I think the point my instructor was trying to make was that gentrification is often thought of as a very narrow process that has only been taking place from ~1950 to the present in American urban areas, when really it just describes the overall decay and renewal that naturally occurs in any urban area. How do we view Hispanic migrants revitalizing rural towns? Is that bad too? I fully realize there’s a certain degree of naivete on the part of any person of relative privilege writing in a very abstract way about what may be very real to some. But, at the same time, wouldn’t an honest discussion be more helpful than an incensed gasp-off?

The question that I want to ask is, what’s the alternative to gentrification? Continued divestment and segregation? The concentration of poverty and those with little political influence? I hate to generalize, but typically the kind of folks who get worked up about gentrification are the same folks who are also concerned about those things. My neighborhood has a mix of income levels–a quick Craigslist search turns up apartments below $500/month and apartments above $3000/month, within a short walking distance of one another. That seems like a pretty healthy equilibrium to me. There are multiple corner stores, at least a couple of which are minority-owned. There’s an East African coffee shop next to a gay bar. That’s what a city is, right?

If anything, evidence would suggest that artificially constraining supply leads to higher rents for the whole neighborhood, and not just in new construction. If a neighborhood is desirable enough, people of means are going to live there. I don’t want to get into the weeds too much, but I tend to be skeptical of many types of government intervention in housing markets, whether it’s the obviously dubious home mortgage interest tax deduction or the well-intentioned but confusing practice of subsidizing the construction of brand new “affordable” units and then renting them, again, at a subsidy, to low-income tenants, often down the street from far more affordable older units.

We shouldn’t be afraid of reasonable private investment and a shifting market. Without that, we have stagnation, and analogies involving Detroit–no one wants that. With the renewed appeal of urban living, we’ll more than likely end up with some bros living in Uptown. Life will go on. Rents will rise in some areas, some businesses will be forced to close and/or relocate–this process will drive motivated entrepreneurs with low capital to different parts of the city. Life will go on. Those entrepreneurs and new residents will revitalize those areas, and the process will repeat itself like it has in some form for centuries. This is what a healthy city looks like.

*Disclosure: The Guthrie Theater offered streets.mn writers free tickets, which is how I + date saw the performance. Clybourne Park runs until August 4th.

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23 Responses to If not gentrification—what?

  1. Tom H. June 27, 2013 at 7:17 am #

    Great post! All old, affordable buildings were new construction once. A neighborhood with nothing but 100 year old structures is just as fragile as a neighborhood with nothing but new construction. Didn’t Jane Jacobs figure all this stuff out, like, 60 years ago?

  2. Jeremy Bergerson June 27, 2013 at 7:36 am #

    Nice post, Nick. I too have heard voluble lamentation about the gentrification of Minneapolis, though most of it has been of the all-the-new-housing-is-for-rich-people stripe. It’s true that, for example, the Gateway District’s explosive growth over the past decade has resulted in a pretty homogeneous, white-ish, old-ish population in that area. That’s both boring and not diverse, but I read it as part of Minneapolis’ growing pains that are inevitable as it redefines itself as a place to live, not just a weekend vomitorium for suburbanites, though Up- and Downtown are now lost to those contingents.

    As someone who’s been living in Chicago for the past two years, I can’t express enough how awesome it is to be in a truly diverse city. It’d be great if Minneapolis-Saint Paul reflected that more, but I wonder if it’s really possible. I mean, Minnesota is, like, the least diverse state in the Union. Still, it’d be great if the housing boom fostered that more.

    For years, the Mpls city council was run by anti-corporate progressives who wouldn’t cave in on development, and the city stagnated. Now we have a lot of new housing, most of which looks cheap and flimsy (the only building under construction in Mpls that seems to have concrete walls and floors is the large condo building going in on Spruce Pl.), and is really ugly to boot (collections of colored rectangles), but my hope is that this is just a phase. Once residential development matures in the Cities, hopefully more better buildings will go up, more mixed-income developments will crop up, and the Cities will step in to help keep places as they are – I mean, anyone who wouldn’t bemoan the loss of University Avenue’s eclectic mix of businesses is either callous or oblivious. Whatever the case, I think everything is moving in the right direction, and with a bit of tweaking here and there, our urban fabric ought to come out with a fine weft and warp.

    • David July 2, 2013 at 12:19 pm #

      > I mean, Minnesota is, like, the least diverse state in the Union.

      One in three Twin Citians 14 and under is a person of color and one quarter of 15-29 year-olds is a person of color, so…

  3. Matt Steele June 27, 2013 at 10:08 am #

    Great article, Nick. Although I would amend “some evidence would suggest” to “basic market economics and a wealth of empirical evidence suggests.”

    I disagree that people have a right to live in the same place for the same rent with the same neighbors in perpetuity. We need to embrace change.

    As Chuck says occasionally in Strong Towns presentations, when new towns on the prairie died, people would just up and move to a different town. We’re too stuck in our ways these days. The pioneers prospered because they were eager to move on and try things new, and take risks even if one possible outcome was (temporary) failure.

    • Nick Magrino
      Nick Magrino June 27, 2013 at 5:34 pm #

      I swear at some point last night I changed that to read less weasel-ey…I don’t like “some people say…”, etc. Gonna change it.

  4. Reuben Collins
    Reuben Collins June 27, 2013 at 10:25 am #

    So how did the date go?

  5. Bill Lindeke
    Bill Lindeke June 27, 2013 at 11:28 am #

    The best book on gentrification that I’ve read is Christopher Mele’s Selling the Lower East Side (http://bit.ly/11Lgkqv), about property owners in that long-time immigration neighborhood who bought, didn’t maintain, and then redeveloped buildings there with far higher rents. In the process, the Puerto Rican community was removed from the area.

    For me, discussing gentrification often seems paradoxical, because actually improving things in a neighborhood (e.g. lowering crime, improving transit, etc.) is often viewed as a bad thing… To me, these changes (e.g. the LRT) often stand in for other well justified long-term racial and/or class grievances.

    The real focus should be on questions like:

    How do we provide quality affordable housing?
    How do we ensure equitable transportation options for everyone?
    How do we make sure that entrepreneurs with less capital have access to opportunity?
    How do we maintain economic diversity in our cities?

    So far, there is a lot of affordable housing being constructed along the LRT. But at the same time, you can feel change happening quickly, particularly in places like Lowertown or closer to the U of MN.

    • Nick Magrino
      Nick Magrino June 27, 2013 at 5:33 pm #

      In the past couple years I’ve really started thinking that we have the cause and effect backwards with housing. We build subsidized housing because people can’t afford housing–but why can’t people afford housing? Because there’s an expectation in the market that certain people are going to be subsidized? Because we think it’s okay for Target to pay people 7.75/hr for 29 hours a week? We created so many ways for low-income people to live outside the regular economy, and I don’t know that that’s worked well for the past fifty years.

  6. Jim Ivey June 27, 2013 at 2:30 pm #

    The negative side of gentrification is that the benefits of improving a neighborhood aren’t realized by the people currently living there. A good portion of that problem stems from a focus on business development that doesn’t increase wages to a level that allows people currently living in the neighborhood to benefit from the jobs that are being created. One example is when the business infill in these neighborhoods tends toward low-wage retail jobs that cater to the desires of the incoming residents (coffee shops and entertainment venues).

    With that said, are there examples of “good” gentrification, where the improvements in a neighborhood actually benefited existing residents by creating permanent new jobs and increasing the average wage to support the cost-of-living associated with higher property taxes?

    • Nick Magrino
      Nick Magrino June 27, 2013 at 6:46 pm #

      I would agree with your middle thought (see my above response to Bill) that we have a system where many people are paid a wage that often isn’t going to pay the rent anywhere. That’s a problem, but that’s a separate problem.

      If anything, compared to, say, Lake Street, an area like West Broadway has shockingly little economic activity going on at all, despite being within easy walking or transit distance of tens of thousands of people. You’d have to build a LOT of new units to even start to get to the point where any current residents would be displaced in that neighborhood, but in theory, they would benefit from the kinds of service jobs that would pop up when new, wealthier residents move in. Someone should be working on all that living wage business, but in the meantime, aren’t we all supposed to be on board with the intrinsic value of a socioeconomically diverse neighborhood?

      But in regards to your beginning and ending thoughts, I don’t know that that’s really something we can be concerned about, is it? Like I said, it’s all part of a cycle–we can’t always be trying to get ahead of the economy, because no one knows how the economy works anyway.

  7. minneapolisite June 27, 2013 at 8:41 pm #

    Just gonna nitpick: it’s “divestment” and that’s coming from an urbanite who had a greenie and thought it wise to add four beers. Seriously though, this isn’t Brooklyn we’re talking about where an already vibrant area is seeing immigrants and hipsters pushed out by high rent. Even if it happened there are nearby places where they could relocate (Central Ave, North, North End and West 7th and Payne-Phalen). The Twin Cities aren’t facing a situation where a fully occupied and healthy neighborhood is getting pushed aside for yuppies, Over here, and in other Midwestern cities much more desperate for anyone with money to relocate, there are plenty of places where hardly anyone will be displaced..

  8. Pat Connolly June 28, 2013 at 10:01 am #

    Love you Nick Magrino. So proud.

  9. Bryan Taylor June 28, 2013 at 10:52 am #

    Here’s my concern when private industry comes in to tap into a market and buy up what was more affordable- induced demand. I look at all the university luxury apartments in which A. Students take larger student loans out for and/or B. their parents cough up a good chunk of the rent when they really shouldn’t be affording it. When it doesn’t become the norm to spend less than $500/month on housing, that establishes what you think is affordable later. “$900? Not bad- I was paying $800 and I was sharing last year!” We then perpetually encourage more spending, more borrowed debt, and a culture where saving/paying debt becomes less and less prioritized. The roof over your head, albeit important, is costing a fortune. Communities do need to stick up for themselves, and collaboration needs to continue on that end. And if a law can stick up for them where money can’t, then it’s better than a totally free market.

    • Matt June 28, 2013 at 12:31 pm #

      Induced demand is where people are paying less than the market rate for something with elastic demand. People will drive on open lanes or park in open parking spaces just like people will drink more at a wedding with an open bar.

      Isn’t it sort of backwards to suggest that regulation of available supply should be driving people’s consumer choices? Look, I think it’s as big of a waste as you do to spend that much on housing in college, but that’s where personal responsibility comes in. If enough people refuse to pay $900/mo for a bedroom, prices will go down and the market will stop building luxury student rentals. In the meantime, the demand displaced from existing housing will reduce costs and increase choices for people wishing to spend less.

      • Bryan June 28, 2013 at 12:45 pm #

        Induced demand states that when supply increases, more of that product is consumed, which is happening in my opinion with luxury apartments and high association fees in condominiums. Let’s make sure people have access to low and moderate costs choices as well, as a community, rather than hoping the market wont like a neighborhood too much/too little. Also, your assumption is individuals can make the best decision for themselves. Based on my experience, there is only a small percentage of the population who makes highly efficient financial choices based on logic, not emotion, and even then our choices can be uncertain.

        • Pb June 28, 2013 at 3:58 pm #

          Mart is right.

          Induced demand only occurs if the added supply reduces price.

          Since price is remaining constant this is simply supply meeting the demand that already exists (Not *inducing* demand).

          The reality is their is huge demand for housing near colleges, and financially it only makes sense to increase supply at the high end, since otherwise your building won’t generate sufficient return on investment.

          • Matt June 28, 2013 at 4:31 pm #

            Supply is increasing but people are paying market rates. It appears as though marketing and playing on people’s sense of entitlement may be inducing demand, but it is not supply inducing demand.

            Induced demand in this case would be if luxury apartments were $400/mo because we’ve mandated oversupply (this is what we’ve done with parking and freeway lanes). Of course people would consume luxury apartments at $400/mo, and then it would be induced demand. That’s not what’s happening here.

            There was another article on Streets.mn about how “affordable housing is existing housing.” Existing housing that’s affordable today was new housing that was “market rate” a generation or three ago. I’m not precluding the need for other policies to address affordable housing. But if we want affordable housing in the short term and in the long term, it helps that goal to embrace this deluge of market-rate apartment building.

  10. mdm June 28, 2013 at 12:35 pm #

    I think Bill’s post is helpful. Its important to remember that “urban renewal” along with many other economic and social shifts in the late 1960s and early 1970s that created the homelessness problems that still plauge cities today. skid row housing and cheap tenaments used to be the norm in large cities. do we want skid row housing or cheap tenaments? not really, but does it prevent some people from being homeless? yes. I used to work with very low income families and when they couldn’t find a super cheap apartment they went into shelter and got on public housing waiting lists. BEFORE they went to look for publically funded housing they were in cheap private housing, as were most homeless americans. public housing isn’t there because people like it and really want to use it, its there because there is a lack of affordable, low cost rentals.

  11. Faith June 28, 2013 at 2:30 pm #

    What if… Uptown hadn’t changed since the 1980s and the demand for good urban places hadn’t increased. Then none of the businesses that felt pushed out of the uptown scene due to higher rents would have gone elsewhere to LynLake, Eat Street, Northeast, etc. After decades of disinvestment in our commercial corridors, it may take a few decades to repopulate them and make the neighborhoods around them better in the process.

  12. Evan Roberts
    Evan June 29, 2013 at 3:00 pm #

    Late to this discussion, but I just wanted to query what people mean by gentrification. I’ve generally understood gentrification to be rising demand (and prices) for older housing, because other attributes of the older housing stock (almost always proximity to downtown or other employment centers) are desirable, *and* there’s little opportunity for new construction. What happened to Milwaukee Ave was gentrification.

    Is lots of new construction leading to the character of neighborhoods changing gentrification? I’m not sure that it is. [Rapidly] Rising prices for older housing stock is often a sign there’s supply restrictions in the area, whether from historic preservation, height or parking ordinances.

  13. Maddie June 29, 2013 at 4:11 pm #

    I don’t there needs to be a value judgement on whether gentrification is good or bad. I think that if a neighborhood is changing, likely improving overall quality of life, it is important to consider what the existing demographics are before these changes are rapidly occuring. Are those people and their current needs being considered and valued as an area changes? I think your skeptism of government programs at a sweeping level is much too general. There have been many good and bad iterations of different programs, but I believe you are using too broad of a brush,

    There are some policy options and ideas that can help to stabilize the markets and assist current residents. Now, many times, the people that are most at risk of losing their quality of life and ability to maintain that stataus are not engaged in the planning / political process. Therefore, they may only feel the brunt of change when it is too late and they are forced to change. This is why it’s helpful for advocates whether it be unions, local non-profits, advocates,etc to be involved. It will help as development happens to examine whether the following ideas could work and should be incorporated into the development planning process:

    – Community benefit agreements which include first-source hiring
    – Rent control boards and rent stabalization measures
    – Connecting house to transportation and ensuring that current public transit service is not cut at the expense of new (typically rail) lines that are targetting new riders over current riders.

    I think just looking at gentriciation as a whole isn’t the right answer but taking a more analytical look at its downstream effects is worth our attention.

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