MEXICO CITY, MEXICO – The simple one- and two-story houses that line Cerrada Lago Andrómaco, a tiny street in the central area of Mexico City, the nation’s capital, contrast with the surrounding high-rise luxury apartment buildings.
About 70 families live in the houses on this street in the Miguel Hidalgo delegation, says Patricia Ramírez Reyes, 28, one of its inhabitants. She remembers when the neighborhood, called Ampliación Granada, was filled with factories. Then, five to seven years ago, the neighborhood began to transform from an industrial district to a sector of luxury apartment buildings.
In an urban development plan issued in 2008, the government of Mexico City earmarked the Granada and Ampliación Granada neighborhoods in the delegation principally for financial and business activities, commercial centers and activities related to residential use.
That same year, near the area where Ramírez lives, Mexican businessman Carlos Slim Helú began developing the Plaza Carso, a massive building complex that includes corporate towers, residential buildings, a shopping center, two museums and a theater. The website for Plaza Carso calls it the largest mixed-use development in Latin America.
Slim is the second-richest man in the world, according to Forbes magazine. The U.S. business magazine ranked him the richest man in the world from 2010 to 2013.
In addition to Plaza Carso, the neighborhood is home to various apartment buildings for middle- and upper-class residents. The purchase prices range from 1.2 million pesos ($90,000) to $1.1 million (14.43 million pesos) for two-bedroom apartments, according to Metroscúbicos, a real estate website. Prices listed in dollars signify an elite status.
Ramírez, who has lived in Ampliación Granada her whole life, says the growing real estate development has improved the neighborhood’s image. But it also has generated traffic congestion, insecurity, noise disturbance, construction-related damage to some houses, and a hike in the cost of services.
Her neighbors fear they will be expelled from the neighborhood, she says. Theirs are the only detached houses on the block among the new apartment buildings.
“Fear that they will run us out?” she asks while sitting in the improvised stall she erected in the street to attend to the moving business her family has owned for 35 years. “Of course! Because the rest look at us strangely; we do not have buildings; perhaps we are not people of their category or of the status of people who are coming to live here with money, with a lot of money.”
Some of the new residents are arrogant and view longtime residents with disdain, she says. They treat their less affluent neighbors badly and make them feel inferior. On the other hand, some newcomers are friendly and approach her to talk and ask how the neighborhood used to be.
New residents should adapt to the existing way of life in the neighborhood, Ramírez says. Instead, she and other longtime residents feel pressure to accept the changes, even when they were not consulted about them.
“We are adjusting to their changes,” she says, “when I think that, through us living here longer, they should adapt to how we live already, and it is not like that. But we hope that they do not oust us.”
The urban transformations in Mexico City’s central area are troubling longtime residents. Urban development experts and real estate professionals say the gentrification of certain neighborhoods is a result of public housing policy, but the city's urban development authority says it is driven by market conditions. Social inclusion policies, stricter urban management and residents’ associations are among proposed solutions as the government plans to study the effect of development on low-income residents.
Since 2001, government and private investment has been concentrated in Mexico City’s central area, which comprises four delegations. It is the area the local government decided to strengthen in terms of housing, shopping, services and street furniture in order to take advantage of existing structures it could renovate, according to the city government’s General Urban Development Program.
Within the central area, the Miguel Hidalgo delegation was issued the second-highest number of housing licenses between 2000 and 2011, according to the National Institute of Statistics, Geography and Information Technology. During the same period, Cuauhtémoc and Miguel Hidalgo were among the delegations where the majority of commercial construction licenses were granted.
The majority of real-estate construction in Mexico City’s 16 delegations in 2012 and 2013 occurred in these two delegations, according to the Ministry of Urban Development and Housing.
These delegations in central Mexico City are becoming gentrified, says geographer and urban development specialist Luis Alberto Salinas Arreortua. Gentrification occurs when an affluent population begins to occupy rehabilitated and newly built structures in an older neighborhood, displacing low-income residents.
Gentrification can occur directly or indirectly, Salinas says. It occurs directly when structures occupied by low-income residents are demolished and replaced with costlier properties. It occurs indirectly when construction and an influx of affluent residents cause increases in rents and the cost of services, such as electricity, piped water, solid waste removal. This indirect shift can also occur when businesses geared toward a more affluent population replace traditional commerce, displacing residents who cannot afford the more expensive cost of living.
Affected neighborhoods include Condesa, Roma Norte and Centro Histórico in the Cuauhtémoc delegation and Granada and Ampliación Granada in the Miguel Hidalgo delegation, says Salinas, a Mexico resident, in a Skype interview from Madrid, the capital of Spain, where he is completing postdoctoral studies at the Universidad Autónoma de Madrid.
Salinas is one of the few Mexican researchers who has studied and has published research on gentrification in the country. He has further distinguished himself by basing his research on field work in Mexico City.
Salinas has studied the case of Condesa, a middle-class neighborhood in Mexico City. In Condesa, he says, commercial establishments and services such as restaurants, bars and nightclubs have replaced traditional businesses such as independent grocery stores, shoe stores and butcher shops. This has increased the number of houses and apartments. It also has increased traffic congestion and pollution and has caused a shortage of parking spaces.
A similar process is occurring in the Roma Norte neighborhood, Salinas says.
Viviana Nuño, 23, has always lived in Roma Norte, she says. For the past three years, she has rented an apartment just three streets away from Álvaro Obregón, an avenue that has seen a proliferation of restaurants and bars in the past five years.
Nuño has also witnessed the expansion of apartment buildings, she says. Longtime residents have suffered consequences, she says. Cars fill the streets. The neighborhood is less tranquil. And some services have become more expensive while their quality has declined.
“Before, it used to be calmer,” she says. “Before, [on] a Sunday, this [neighborhood] used to be empty. Now on Sundays, you see the restaurants open, the bars. You see different buildings each week, apartments for rent. Because the neighborhood was old, there are buildings that they either restore or they demolish, and they begin the construction of new apartments.”
Rents have increased because the neighborhood is in style, and students, foreigners and young people from rich neighborhoods have come to live there, Nuño says.
She currently pays 5,600 pesos ($420) monthly for a spacious apartment that she shares with her mother, her sister and her niece. But she pays a lot less because she knows her apartment’s landlord.
The cheapest rent for an older apartment in the neighborhood is now 8,000 pesos ($600), sometimes for spaces much smaller than Nuño’s apartment, she says. Meanwhile, on the same street where she lives, a newer apartment about the size of hers rents for 14,500 pesos ($1,105) per month, more than $500 – 84 percent – higher than the cheapest rent in the neighborhood, according to Metroscúbicos.
María Félix Plaza Miranda, 64, has been living on Mesones Street in the renovated section of Centro Histórico for 40 years. Because she owns her apartment, she is unaware of rent increases, she says.
But she has noticed changes such as the conversion of a nearby street into a pedestrian corridor where more than a dozen restaurants and bars have opened. She sees the changes as positive because the new businesses create jobs.
“Everyone needs to work,” she says.
But although the changes have improved the neighborhood's image, they have not addressed its problems, such as insecurity, Plaza says.
Gentrification has also been occurring outside the city’s central area, Salinas says. Examples include the Centro Histórico neighborhood in the Coyoacán delegation, the San Ángel neighborhood in the Álvaro Obregón delegation, the Tlalpan Centro neighborhood in the Tlalpan delegation, and the zone of Santa Fe, which is part of the Álvaro Obregón and the Cuajimalpa de Morelos delegations.
Local stakeholders disagree on the cause of gentrification in the capital.
The local government encourages gentrification in order to promote private sector urban development in areas where it is occurring, Salinas says.
“When investments are given the green light,” he says, “they are encouraged with different tax policies on investment and are left totally open to the point that private investment is practically what will be leading the transformations in cities. From there, we see how they are basically shaping the cities with private interest.”
But architect Laura Janka Zires, adviser to Simón Neumann Ladenzon, the head of the Ministry of Urban Development and Housing, says the market regulates urban development through supply and demand. Therefore, the government will neither interfere in this process nor control gentrification in certain areas.
“It is difficult to control, as a government, the expulsion of certain social groups from certain neighborhoods,” she says, “because the sale price cannot be controlled – not of the land, nor the housing, nor rent, nor anything beyond social housing programs.”
Nonetheless, the ministry regulates the permitted use of land in the city. It authorizes home construction and regulates the size and location of houses. It also determines what kinds of businesses can open in a sector. There is no law regulating rents.
By approving changes in land use, the city government determines which real estate developments are geared toward middle- and upper-class residents, says Roberto Barrios Gaxiola, president of the Mexico City chapter of the nongovernmental Asociación Mexicana de Profesionales Inmobiliarios, a national association of real estate agents.
In addition to authorizing changes in land use, the government maintains housing and finance policies that have encouraged the development of low-cost housing on the periphery of the city, Barrios says.
“It is false that the real estate sector is the one that has made those changes,” he says. “The changes emanate from governmental policies: first, land uses, and second, governmental policy of financing housing. That is what generates it, and not us.”
But Barrios denies that the government promotes the interests of the real estate sector through public policies such as land-use decisions.
“I would not look at it as if it has been done to favor developers,” he says. “I would not look at it like this in any way. I see it rather that this has been to regulate the city and to prevent the quality of life in the city from being further deteriorated.”
The real estate sector acts according to the law, Barrios says.
“Developers – like any employer of any type – create jobs, pay taxes and obey the laws,” he says. “And if the laws do not allow them to build in an area, they do not build. And if the laws allow them to build in another area, they build there.”
The government also motivates gentrification through projects to reclaim public spaces that encourage private investment, as in the city’s Centro Histórico, Salinas says.
Since 2002, the local government has been in charge of renovating the urban infrastructure and restoring the Centro Histórico, with funding from the private sector, according to the Centro Histórico Authority, the administrative body in charge of promoting social and financial development within the downtown area. One of its purposes was to increase the supply of housing and services. It also evicted and relocated 26,000 street vendors.
“This type of public policies, what it is trying to generate is more investment,” Salinas says. “Therefore, many people of limited resources who live in the Centro Histórico have to move because they start to raise the prices of rent, services and so forth. So, there, yes, there are very real and very clear public policies in generating gentrification processes.”
Private investment is necessary because the government does not have the economic resources to finance the restoration of public space, Janka says.
She clarifies that allying with the private sector does not mean that the private sector influences urban development according to its interests. The challenge is regulating private sector participation, she says.
The government did not anticipate that its restoration of the Centro Histórico would lead to social exclusion or that it would spark real estate development for people with greater resources, Janka says. But she acknowledges that these projects can have indirect effects.
“Now you are seeing that the public space generates an added value to the development,” she says. “So, that is indirectly raising the value of land.”
Local stakeholders recommend various solutions to prevent the displacement of low-income residents and social tension.
Plaza says she has seen many foreigners moving into the neighborhood. She sees this as an opportunity.
“I think that it is good that people come and we combine cultures,” she says.
Salinas and Janka both see promoting social inclusion in urban development as a way to prevent the displacement of low-income residents.
Up to now, the government has not analyzed the impact that real estate development has had on the original population in areas undergoing renewal, Janka says. It has not created mechanisms to promote social inclusion in these developments.
“We are just beginning to measure and quantify this a bit and to really get our act together to design the instruments that can make that possible, which really do not exist right now but are under construction,” she says.
This year, the city government will revise its 2003 General Urban Development Program, Janka says. It plans to address the issue of social inclusion in this process.
Salinas raises other alternatives.
“I think that an urban management that is not so lenient with private investments could generate different mechanisms in order to avoid or to minimize this type of transformation processes,” he says.
Another way to avoid gentrification is for affected populations to organize themselves and to voice their opinions collectively, Salinas says.
Nuño believes such organization will enable the original residents of her community to avoid moving, she says. She acknowledges that tenants who cannot pay the high rents are possibly leaving. But despite the changes and their effects, old neighbors are entrenched and organize to protest when something does not sound right.
“We are seeing how people from other places come to the neighborhood,” she says. “They do not affect a lot if they respect the neighborhood’s customs. Yes, there is suddenly one then another who comes and wants to impose, but we neighbors put the brake on in that moment.”
Ramírez says she does not oppose the changes that bring improvements to the neighborhood. But she thinks the people moving into the neighborhood must show the same willingness to accept cultural differences.
“If it is going to look better and we can all live together well, without problems, then better!” she says. “Because you are also not going to stay without growing, without evolving.”
Ramírez and her family will resist any pressure to move out of the neighborhood, she says.
“We deny to ourselves that there can be a change, that they tell us, ‘I buy you, and go away,’” she says. “I think that no one would accept. Neither I nor my family would accept to go to another place, for as much money as they may give us. Or rather, there are many things that we would not trade for money.”
GPJ translated this article from Spanish.