Ken Walton / Flickr

Neighborhoods don't transform only because rich people suddenly decide to move there.

Much of the conversation around gentrification essentially blames the people moving into urban neighborhoods. This feeling—that anyone who might be described as a gentrifier is doing something wrong—has even spilled into popular culture. Spike Lee famously ranted about the cultural cluelessness of the gentrifiers invading Brooklyn. David Byrne and Moby argue that the super-rich not only threaten the poor and the middle class, but the artists and musicians who long generated the pulse of New York’s creative scene. IFC’s Portlandia offers an over-the-top comedic take on what happens when middle-class white people take over urban neighborhoods. And then there’s the raft of articles on gentrifiers’ guilt, and quizzes that tell you whether or not you fit the bill.

Setting aside for the moment the question of whether most people are even accurately defining the term, there is in fact an entire scholarly literature that pins gentrification on the cultural norms, values, and strategies of advantaged groups like my very own creative class.

But a comprehensive review of gentrification research by researchers at the University of California Berkeley and UCLA, published by the Federal Reserve of San Francisco, helps us better understand the real underlying drivers of gentrification. While the location choices of advantaged groups provide its immediate impetus, gentrification—and the actions of these very groups—is also shaped by large-scale government policies and public investments.

Gentrification and Transit

The largest, most important, and most obvious example is transit—subways, light-rail, buses, and other forms of urban mass transit—which the study dubs “transit-induced gentrification.” It is no secret that affluent people in large, dense, congested metros are drawn to transit hubs. Numerous studies have examined the clustering of advantaged groups and neighborhood transformation taking place along subway lines, cable cars, light rail stations, and along rail lines out to the older suburbs surrounding large cities. Reviewing a large body of research on the effect of rail transit on property values, the San Francisco Fed study does find evidence of a small to modest premium for properties located near rail stations.

My own research has found a connection between gentrification and transit within cities and across metros. And my University of Toronto colleague David Hulchanski has documented the clustering of affluent groups along Toronto’s main subway and cable car lines as the city has become increasingly divided between affluent areas along transit routes and in the core, and less advantaged areas, which are being pushed yet further to the periphery. Back in July, I wrote about a recent study of New York City, which found that, while more affluent groups have increasingly clustered around subway stops in both Lower Manhattan and Brooklyn, the role of transit is bound up with other structural factors, contributing to an influx of more advantaged people into these areas.

The Smith-9th Streets station in Brooklyn. (MTA New York City Transit / Marc A. Hermann / Flickr)

The Fed study suggests that there are two reasons why transit is connected to gentrification. On the demand side, transit allows more privileged groups—especially in dense, congested cities and metros—to trade arduous car commutes for transit. By giving up their cars, these affluent residents can devote more money to housing, which drives up its cost in these accessible neighborhoods. On the supply side, investment in transit—especially substantial investment in new or refurbished transit lines—signals a large-scale commitment to neighborhood upgrading, which attracts more affluent new residents and also drives up property values.

Of course, the real issue here is not mass transit per se, but the scarcity of it. Such aggressive clustering around subway and rail stops is a function of out-of-control congestion and not nearly enough transit infrastructure to compensate and serve all who need it. The result is the extreme bidding up of scarce locations near transit, especially in dense, congested cities and metro areas.  

Transit and transportation infrastructure has long determined America’s urban economic development and its class divides. The urban historian Sam Bass Warner long ago showed how the development of early industrial cities was shaped by the location of advantaged groups along street car and transit lines.  The middle-class later followed new roads and highways out to the suburbs.

Gentrification and Other Public Investments

But transit is not the only kind of public investment that can help spur gentrification. Schools are another obvious one. Along with crime, the perception, and in many cases the reality, of lower quality schools has long driven middle-class families out of cities. More advantaged groups are attracted to investments and improvements in public schools, including the creation of new charter and magnet schools. As they migrate back to urban neighborhoods, these groups in turn create increased political pressure for additional investments in local schools.

Universities, colleges, and affiliated medical centers—so-called “eds and meds”—are another channel through which public investment shapes gentrification. In addition to public universities, private research at universities in large cities such as Columbia, NYU, Johns Hopkins, and UPenn receive substantial federal support. Many of these universities also provide housing or housing subsidies for the faculty and staff who live in and help gentrify adjacent neighborhoods. My own study of divided cities documents the role of universities and knowledge institutions as key attractors of the creative class. Here again, the location and clustering of these advantaged groups create both the market demand and political pressure for greater amenities, better schools, and other services that generate a cycle of neighborhood improvement and gentrification. While many have written about the role of universities in technological innovation and talent attraction, one must also consider the roles they play in neighborhood change and inequality.

Parks and open space are yet another kind of public investment that can spur neighborhood transformation. The Fed study notes that property values are higher in proximity to parks and green space. Improved parks and reclaimed open space reduce crime (and, even more so, the perception of crime) and signal neighborhood improvements that attract more advantaged groups. This is perhaps even more the case with public investment in and around waterfronts, including the redevelopment of ferry terminals. My own research shows a clear pattern of creative class location around waterfronts. In older, former industrial cities, waterfronts often have a mix of factory and warehouse buildings that can be reclaimed as workspaces, restaurants, bars, and housing for the creative class.

Large-scale public redevelopment efforts, like Hudson Yards in New York City, Toronto’s waterfront redevelopment initiative, and Pittsburgh’s North Side urban stadium district are also worth mentioning. These initiatives pour massive amounts of public money into transforming large swaths of formerly industrial districts into mixed-use developments aimed at knowledge workers and new urbanites.

The newly constructed Hudson Yards transit stop in New York City will open on September 13th. (Brendan McDermid / REUTERS)

The reality is that the revitalization of our cities and the very structure of urban areas have long been shaped by massive public investments. These are choices made by local and federal officials, business interests, and other advantaged stakeholders who constitute the urban growth coalitions that have long shaped investment in cities. The location decisions of gentrifiers are shaped by this broader context.

While necessary, it will not be sufficient to tinker at the margins with small-scale affordable housing efforts or half-hearted moves to increase the minimum wage. Building less divided and more inclusive cities will require a different and far more extensive set of public investments, along with a renewed federal commitment to addressing the root causes of persistent poverty and concentrated disadvantage.

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