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Universiteit van Amsterdam
Centre for Latin-America Research and Documentation (CEDLA)
Mirtha Lorena del Castillo Durand: UvA ID: 11132892
Supervisor: Dr. Christien Klaufus
Second reader: Dr. Annelou Ypeij
Submission: Amsterdam, December 2017
Strategies, social effects, and citizen responses of Barranco’s urban
renewal process, Lima
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List of contents
List of illustrations ... 3 List of tables... 5 List of abbreviations ... 6 Acknowledgments ... 71. Barranco under construction ... 8
Contingency and subjectivity: My trajectory to study gentrification in Barranco ... 8
1.1 My role as a gentrification researcher in Barranco ... 9
1.2 Locating gentrification in Barranco ... 10
1.3 Why Barranco? The relevance of this case study ... 12
1.4 2. Literature review and research design ... 13
Gentrification, spatial justice, and public space in the contemporary city ... 13
2.1 Research question and operationalization ... 16
2.2 Methods of data collection ... 17
2.3 Methods for ordering and structuring the information ... 18
2.4 Finding my own path: my experience as a gentrification researcher in Barranco ... 18
2.5 3. The spatialization of the problem... 20
Lima’s real estate boom ... 20
3.1 Barranco in the frame of the real estate boom ... 22
3.2 Barranco’s socio-spatial background ... 24
3.3 Conclusion ... 27
3.4 4. Barranco’s urban renewal process: Strategies and aftermaths ... 28
Displacement of “Genuine Barranquinos”: The story of the quintas and solares ... 28
4.1 The expansive wave of urban renewal processes ... 32
4.2 Barranco’s urban renewal process and promises for development and modernization ... 35
4.3 The loss of the heritage architecture ... 38
4.4 Conclusion ... 43
4.5 5. Barranco’s urban renewal process and the loss of cultural identity ... 45
The capture of Barranco’s genuine cultural values ... 45
5.1 The mourning of culture: displacement of Barranco’s cultural centers ... 52
5.2 Conclusion ... 57
5.3 6. Barranco’s urban renewal process and the fight for public space ... 58
The resignification of public space ... 58
6.1 “Los Yuyos” case: struggling for Barranco’s public space ... 70
6.2 Conclusion ... 80
6.3 7. Conclusive chapter: the trajectories of Barranco’s urban renewal process ... 82
References ... 86
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Appendix B: List of conducted interviews ... 100 Summary ... 102 Resumen ... 105
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List of illustrations
Illustration 1-1: Image of Medalit’s house and the construction of Quinta Arrieta’s project ... 9
Illustration 3-1: Maps of Greater Lima - Peripheral and Central Lima ... 21
Illustration 3-2: Evolution of apartment prices per square meter 2012 – 2017 ... 22
Illustration 3-3: Percentage growth of square meter prices in Barranco and San Isidro 2014 – 2017 ... 22
Illustration 3-4: Distribution of Barranco’s population ... 25
Illustration 3-5: Map of “El Metropolitano” trajectory in Barranco and images of Avenue Bolognesi ... 27
Illustration 4-1: Residents and dwellings of quintas and solares ... 30
Illustration 4-2: Location of the "Quinta San José" ... 32
Illustration 4-3: Percentage growth of square meter prices 2014 – 2017 in Jesús María, Barranco, Chorrillos, Miraflores, San Isidro and San Borja ... 33
Illustration 4-4: Percentage growth of new-build apartments 2014 - 2017 in Jesús María, Barranco, Chorrillos, Miraflores, San Isidro and San Borja ... 34
Illustration 4-5: Images of Barranco’s adobe houses with “for sale” signs ... 38
Illustration 4-6: Images of medium and high-rise buildings ... 39
Illustration 4-7: Map of Barranco’s monumental area ... 41
Illustration 4-8: Images recovered from the leaflet of Stelar project ... 43
Illustration 5-1: Image of a leaflet showing Barranco’s municipal library with the municipality’s slogan ... 46
Illustration 5-2: Images from the inside of Barranco’s municipal library ... 49
Illustration 5-3: Images of Martin Adan’s house ... 50
Illustration 5-4: Image recovered from the leaflet of “Domeyer Building”... 51
Illustration 5-5: First row of images recovered from the leaflet of “Stelar” project, second row of images recovered from the leaflet of “El Mirador de Barranco” project ... 52
Illustration 5-6: Image of the left shows a concert in “El Cinematógrafo”, image of the right shows the new residential building “Atelier” ... 54
Illustration 5-7: Image of the left shows “La Libre’s” owners, image of the right shows the inside of “La Libre” ... 54
Illustration 5-8: Image on the left shows the moment that the excavator tumbled the dividing wall between “La Libre” and the future residential building “San Martin 140”, image on the right shows the project itself ... 55
Illustration 5-9: Image on the left shows a fair of independent designers carried out in “Casa Tupac”, image on the right shows the construction of project “Osma 307” ... 56
Illustration 6-1: Social protests against the concession of the “Confraternity Park” ... 61
Illustration 6-2: Image on the left corresponds to the civic center "Manuel Beltroy Vera", image on the right corresponds to the MAC ... 62
Illustration 6-3: Fences surrounding the park ... 63
Illustration 6-4: Image on the left shows a climbing tournament promoted by the clothing brand “The North Face”, image on the right shows a public relationship event of the car brand “Mitsubishi” ... 65
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Illustration 6-6: Image on the left shows the only remaining “Bajada a la playa”, image on the
right shows buildings blocking former “Bajadas” ... 66
Illustration 6-7: “Las Cascadas” beach before and after the concession ... 67
Illustration 6-8: Rústica's parking lots invading the sidewalk and the bicycle lane ... 69
Illustration 6-9: Garden of “Cala’s” restaurant ... 69
Illustration 6-10: Image on the left shows the mock-up of the first version of Ana María project, image on the right shows the mock-up of the second version ... 71
Illustration 6-11: Screenshot of the Facebook page of Barranco’s mayor explaining details of “Ana María” project ... 72
Illustration 6-12: Image of the left shows Vilma Gonzales making statements for Canal N, image of the right shows José Rodríguez making statements for Panamericana television ... 76
Illustration 6-13: Invitations to the “plantones playeros” and images of public demonstrations .. 77
Illustration 6-14: Callings for protests on different Facebook pages ... 78
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List of tables
Table 3-1: Comparison of building parameters of Lima Top districts ... 24
Table 3-2: Total population and poverty percentage of Lima Top districts ... 24
Table 4-1: Barranco’s housing types by 2007 ... 39
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List of abbreviations
ADI: Asociación de Desarrolladores Inmobiliarios APCV: Autoridad del Proyecto Costa Verde
BBVA: Banco Bilbao Viscaya Argentaria BCRP: Banco Central de Reserva del Perú
CAPECO: Cámara Peruana de Construcción
IAC: Instituto de Arte Contemporáneo INC: Instituto Nacional de Cultura
INEI: Instituto Nacional de Estadística e Informática MAC: Museo de Arte Contemporáneo
PDC: Plan de Desarrollo Concertado
SBN: Superintendencia Nacional de Bienes Estatales
SBS: Superintendencia Nacional de Banca y Seguros del Perú SUNARP: Superintendencia Nacional de los Registros Públicos
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Acknowledgments
I dedicate this work to the memory of my mother. Her many reflections and experiences as an administrator of real estate assets started my interest in urban studies and gave rise to this research. Also, I am grateful for the patient work of my supervisor Christien Klaufus throughout this process. Her guidance and knowledge were crucial in overcoming the personal obstacles and difficulties that arose during this work. Likewise, I want to thank the collaboration of Vilma Gonzales who helped me to better understand the history of Barranco and my many other interviewees who facilitated me the information needed for the development of this research. Especially José Rodríguez, José Ayulo and Javier Alvarado, activists of urban social movements whom I interviewed several times and gave me their free time to answer all my questions. Finally, I want to thank Simon Vleugels for his tireless support in editing the texts that are now part of this work.
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1. Barranco under construction
Contingency and subjectivity: My trajectory to study gentrification in Barranco 1.1
My interest in the changes occurring in the urban landscape of Barranco (Lima) and their impact on the locals started in a way that is probably uncommon: as a client of a real estate company. My mum and I used to live in Lima. When she passed away, she left me in inheritance a property in the outskirts of Arequipa (the second largest city of Peru). Due to the distance, I’ve experienced maintaining that property as a difficult and time-consuming task. Consequently, I decided to sell it in order to purchase an apartment in Barranco due to its strategic location and its leisure offer. It was located nearby the sea and next to Miraflores, one of the richest and the most touristic districts of the city. Barranco also had a thriving nightlife and a diverse cultural scene. In search of an apartment, I started walking along its streets and in a matter of minutes I found myself surrounded by multiple real estate projects that targeted young professionals of the upper and the middle-classes. After a negotiation with Abel, a real estate agent, I bought an apartment in a high-rise condominium with several private facilities. During my walks in Barranco I wanted to have a few dresses that my mother left for me, tailored to my body shape. And so, I met Medalit, a seamstress and a resident of a derelict area of the district. The third time I visited her I noticed that a few things in her street had changed. A fence was blocking the traffic, there was an excavation about five meters deep next to her home and there was an unbearable noise disturbing us throughout the visit. When I asked her, what was going on she replied that “Quinta Arrieta”, a new residential building was under construction.
Without much academic knowledge about gentrification, I realized that residents of a highly unequal and socially diverse district as Barranco must have very diverse perceptions and experiences with the effects of the real estate boom that has been taking place in Lima for the past ten years (2007 - 2017). I assumed that these different experiences may have caused social struggles. It should be emphasized that Barranco encompasses a widely variated type of urban settlements. While apartments in high rise towers could be valued on three million soles (approximately 800,000.00 euros)1, there are other areas with precarious adobe building where six family members live in a 12-square meter rooms and share the bathroom with ten other families under the same condition. With that context in mind, I understood that being a home owner in Barranco could mean at least two different things. For Abel and for myself, owning a property in the district could be reduced to a monetary transaction where a place to live could be transformed into an asset. In other words, I could decide to inhabit the new apartment or not. Meanwhile, due to the unstoppable real estate boom, “investing” in a property was going to appraise my money as the years went by. Moreover, Abel advised me that I should take the opportunity to buy an apartment since square meter prices were still affordable for my pocket, especially in Barranco, an up-coming neighborhood highly demanded by young professionals and new couples. Likewise, he told me that Barranco would always have the essence and the mysticism that attracts tourists and artists since it was the traditionally bohemian neighborhood of Lima. For Medalit, owning a home was not just about owning a physical space and her neighborhood was not only a “strategic location”. Both her home and her neighborhood were a very important part of her life, where her friends and her clients could find her. It was her place of belonging.
After a year I came back to Medalit’s neighborhood, I observed that she and her family lived in the shadow of “Quinta Arrieta” (see illustration 1-1), a 7-story building with 17 of the most expensive apartments of the district (Vicca Verde, 2017). Apart from the noise she told me that in
1Prices along this document are shown in the Peruvian local currency: soles. According to the average
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the peak of the construction, she thought that her house was going to collapse because of the rumbles of the mechanical shovel. She pointed out that the hardest times for her were during the summer. Despite the high temperatures of the environment, she was not able to open the windows because of the dust and the smell. Not only she had to deal with the unpleasant odors of the construction material, but every Saturday the construction company also cleaned the chemical toilets used by the workers which produced an unbearable smell. On top of that she noticed that her adobe house was clearly deteriorated. The wood was chopped up and suddenly cracks in the structure started to appear. I also observed that the street had changed. Several properties on her street were already sold. She told me that the developers of “Quinta Arrieta” project had offered to buy her house. Since it was a family property, she had no decision rights. But she told me that she would not leave. She had been living and working there for more than 20 years. A few blocks away, she had a stand in the market that she had “built with her own hands". Illustration 1-1: Image of Medalit’s house and the construction of Quinta Arrieta’s project
(Source: fieldwork pictures)
Comparing Medalit’s experience with my own made me reflect on two aspects. First, I noticed that in the conversations with the real estate agent, the frequently used words that expressed regeneration and revival of the area had an overall positive connotation: the urban renewal process would turn Barranco into a more modern, appealing, and safer environment for new social groups (such as young professionals, new couples, and foreigners). I felt that real estate companies treated the former urban space as an empty and abandoned area that had to be intervened and developed. However, the negative impacts that new constructions had on long-term residents were never addressed. Secondly, by turning urban space into an asset, real estate companies only thought of urban land as a commodity with economic potential and underestimated other alternative values. With this view on the urban renewal process I wondered how many families like Medalit’s had to go through the same struggle Who were the ones who had sold their homes or moved out to make way for the new buildings? What is the role of urban policies in this process? What were the perceptions of the different social groups of the district after ten years of real estate boom in Barranco?
My role as a gentrification researcher in Barranco 1.2
I narrate my personal experience not only to describe how I started to develop an interest in urban studies, but also to be explicit about how my perspective was enriched as I became a researcher of Barranco’s urban renewal process. However, two issues had accompanied me during my whole trajectory: Should I consider my decision to buy a property as part of the problem? Did buying an apartment in a new residential building in Barranco disqualify me to study the urban changes of the district? In this respect, I would like to emphasize that the new knowledge that I acquired during this research helped me to reformulate my thoughts about the organization and structure of cities. Thus, with this work I attempt to develop a critical eye to analyze
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gentrification strategies and effects in Barranco. Besides, although I have taken steps to maintain a distance as a researcher, I believe that my proximity to this topic has also allowed me to paint a richer picture of this phenomenon. In other words, by knowing the characteristics, the actors, the processes, and the struggles of Barranco, I found myself more able to understand the complexity of the forces that dispute urban space in the district. I also discovered that responses to urban transformations showed various forms of adaptation and resistance. Hence, these responses could be considered bottom-up alternatives to the enforced redefinition and redistribution of urban space by the municipality and the real estate agents. Therefore, I agree with scholars stating that awareness to the gentrification debate will contribute to develop (1) strategies to claim spatial rights and (2) new rules to change the exclusionary forms of authoritarian governmentality present in Latin American cities (López-Morales et al., 2016, p. 1103). Finally, during my three months of fieldwork I understood the sociodemographic characteristics of Barranco and I saw its social diversity had always produced social tensions between rich and poor residents. Furthermore, despite being small, both physically and in terms of population, Barranco had a long trajectory of community and social participation (Carrasco, 2011, p. 36). These observations form the starting point of my academic search. And so, I hypothesize that Barranco’s residents are not opposed to the changes in their urban environment, however they demand that the urban renewal process respects their identity, their values, their traditions, and their necessity of public space. Thus, based on that hypothesis, the research question that I aim to answer is:
How are the strategies and effects of Barranco’s urban renewal process linked to the spatial rights of the district’s long-term residents?2
Locating gentrification in Barranco 1.3
Between 2007 and 2017, an unprecedented real estate boom has characterized Lima. In this context, Barranco, considered to be the smallest, most mixed, unequal, and socially divided district of the inner-city (Municipalidad de Barranco, n.d. a, n.p.), has been part of an intense urban renewal process. However, unlike other central districts of Lima, until 2016 the district lacked of a valid and applicable Concerted Development Plan (PDC)3. Due to the pressure from urban social movements of the district, in 2016, the Municipality of Barranco approved the first PDC of Barranco (Municipalidad de Barranco, 2016 a, p.2). Several activists of the district claimed that this document has not been constituted in a legitimate participatory process. Also, they stated that local authorities do not considered the document when they decide upon the fate of the urban space of the district. Both real estate companies and local authorities exploit this institutional vacuum. On the one hand, without taking into account an urban planning horizon, it is easier for real estate companies to negotiate with the municipality for advantageous construction permits. On the other hand, the autonomy given to municipal administrations during Peru’s decentralization process in 2002 and the country’s inefficient accountability system (Defensoría del Pueblo, 2010, pp. 107 - 112) had empowered municipal officials to authorize new projects with little fear of public liability. Likewise, due to Barranco’s fiscal deficit, local authorities justify their decisions to ease the rules for real estate business as the only possible way to develop the district. They believe that new residential and commercial buildings will increase economic resources through tax collection and the concession of public spaces. Moreover, construction companies and the municipality sign private-public agreements to restore infrastructure and install new services in the surroundings of new buildings under the premise of serving the public good (Municipalidad de Barranco, 2017 a, p.1). During the years of the real estate boom (2007 - 2017), municipal administrations in Barranco continued with the lack of
2 Section 2.2 explains details about the operationalization of the research question.
3 The Concerted Development Plan is a master plan that should be designed in a participatory process. This
plan aims to develop common objectives between local authorities and residents of a district or city. After the designing process, local authorities must ensure its compliance (Congreso de la República, 2003, p. 133).
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urban planning and with the relaxation of the requirements to facilitate the construction of residential buildings and commercial developments (Decisión Ciudadana, 2017, a). Additionally, the strong presence of artists and “hipsters” in the district promoted the development of high-culture centers and redirected local businesses to satisfy high-income groups (Archdaily, 2016). As a result, long-term residents of Barranco perceive a shady atmosphere in the decision-making process of urban policy, and they believe that the escalating prices of new apartments and the turnover of new business in the district incline to favor higher social groups whilst the necessities of lower social groups are compromised4. In short, one could say that the urban policy in Barranco is focused on attracting private investments and a higher income population, which results in a typical gentrification process. Ruth Glass coined the concept of gentrification in 1964. It originally referred to a process by which working class residential neighborhoods are revitalized by middle class homebuyers, landlords, and professional developers, causing property values to increase, which would have the collateral effect of driving out poorer families (as cited by Lees et al., 2008, p. 8). However, Neil Smith argues that gentrification should not be restricted to a permanent definition and should consider the broad range of processes that contribute to its restructuring. In his contribution to the Urban Human dictionary, he claims that gentrification is:
The reinvestment of capital at the urban center, which is designed to produce space for a more affluent class of people that currently occupies that space, displacing low-income families and small businesses. (Smith, 2000, p. 294)
Gentrification theory was coined to explain urban revitalization and displacement in typical “western cities”. However, López-Morales et al. argue that when applying this theory to the Latin-American context, the region’s characteristics should be taken into account such as the imbalance between central urban areas with plenty infrastructure and extended deprived peripheries, the reproduction of informality in all the spheres of social life, and social inequality due to preexisting socio-economic structures (López-Morales et al., 2016, p. 1094). In other words, the social changes that gentrification produces are an example of class imposition through the accumulation of economic, social, and cultural capital. Moreover, private investments, market-oriented policies, and middle-class groups, including artists and “hipsters”, strengthen the reproduction of global urban lifestyles capable of displacing aesthetics, economies, and consumption patterns that follow global trends (Mathews, 2010, pp. 661-666). Consequently, certain social practices and preferences considered undesirable are casted out through urban policies, municipal regulations and mechanisms of control and surveillance. The new neighborhood conditions require residents of central areas to have certain ethnic and class features and preferences to follow specific lifestyles that are validated as desirable public behavior. In the process, social groups without “appropriate” cultural, social, or economic features are displaced (Davidson, 2008, p. 2390; Hubbard, 2016, pp. 4 - 5). In that regard, gentrification has become a concept that not only explains displacement and replacement of one social class for another one. But it has extended to describe other processes such as functional changes in the overrepresentation of cultural characteristics, aesthetic formulas, etc. (Díaz, 2013, p. 21).
George and Eunice Grier have defined displacement as a phenomenon that occurs when any household needs to move out from its residence because the conditions that affect the dwelling or its immediate surroundings are beyond the household’s ability to control or prevent (as cited by Marcuse, 1985, p. 205). The main cause of displacement is related to the increase of housing prices, but it is also associated with the changes of the physical conditions of the house or the neighborhood, such as infrastructure, public facilities, transportation patterns and supply of goods and services (Marcuse, 1985, p. 207). However, Delgadillo states that in Latin American cities, displacement followed different trajectories than those in western cities (Delgadillo, 2015).
427 out of 34 (79%) of the informants believed that corruption is widespread in the local government and is
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Similar to Delgadillo, Janoschka & Sequera state that three recurring categories of displacement could be found in Latin American cities: (1) displacement by heritage dispossession, (2) displacement by cultural dispossession and (3) displacement by ground rent dispossession (Janoschka & Sequera, 2016, pp. 1183 – 1187). Inzulza identified a fourth type of displacement: (4) displacement by transformation of housing typology (Inzulza, 2016, p. 1198). These four categories of displacement were found in Barranco as well. This case study will attempt to describe two additional categories unaccounted in other works about Latin American displacements: displacement by physical destruction of houses and displacement of cultural centers. Local authorities justify gentrification and displacement by arguing that both are necessary processes for the development, modernization, and progress of the city. For example, Janoschka & Sequera described cases in Rio de Janeiro, Santiago de Chile, Mexico City, and Buenos Aires where the government’s plans justify the displacement of “unwanted social groups” for urban projects that supposedly will benefit the collective interest (Janoschka & Sequera, 2016, pp.1182-1190). Paradoxically the negative impacts of those plans often fall disproportionately on low-income population (Delgadillo, 2015). This is where gentrification processes are related to spatial justice. The spatial justice theory refers to the geographical aspects of social justice and aims to encourage a fair and equitable distribution of socially valued resources, such as central areas, public spaces, and services, but it is also focused on the opportunities to use those resources. Therefore, the spatial justices approach studies cases of spatialization where socio-economic structures privilege certain groups of population at the expense of other groups (Soja, 2009, pp. 2 - 3). Thus, spatial justice theory will be suitable to analyze the gentrification process in Barranco as a producer of power imbalance between higher social groups that take economic and physical advantages of urban space while spatial rights of lower social groups are being infringed.
Why Barranco? The relevance of this case study 1.4
I consider that Barranco’s urban renewal process presents one of the most striking scenarios of urban struggles in the contexts of a voracious real estate boom. I also noticed that effects of Barranco’s urban renewal process are intensifying sociopolitical tensions between high-income and low-income population. Hence, I believe that a study about gentrification in Barranco will provide a suitable framework to understanding potential spatial injustice in central districts of Lima. Likewise, due to Barranco’s long trajectory of urban social struggles, this case will contribute to unravel the strategies of urban social movements to confront or adapt to new forms of spatialization in Latin American cities. Finally, it will emphasize the importance of urban planning from the perspective of citizen claims. Thus, by the end of this analysis I hope to accurately describe the following elements of Barranco’s urban renewal process: the strategies that subordinate public actors to private actors’ necessities; the social effects of gentrification and market-oriented policies in terms of spatial justice and spatial rights of long-term residents of Barranco and the social struggles and social movement responses to the new spatialization produced after the real estate boom. Consequently, I consider that the relevance of this research lies in three main aspects. To begin with, unlike other Latin American metropolis, and despite the latest real estate boom, there is scarce literature about gentrification and spatial justice in Lima’s central districts. Secondly, based on a bibliographical review, it is worth highlighting that the big majority of urban studies in Lima are focused on the social dynamics of informal settlements in low-income peripheries. This leaves open a niche for the study of the emerging social dynamics and phenomena that take place in central districts of the city. Thirdly, the study of Barranco’s urban renewal process provides new elements that extend the debate about the (negative) social effects of gentrification and the responses of urban social movements in Latin American metropolis.
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2. Literature review and research design
To study Barranco’s urban renewal process, I took two main theoretical frameworks into consideration: Gentrification and Spatial Justice. The first one describes gentrification in the Latin American context. With this theoretical framework I aim to explain the changes that this phenomenon is producing on both the social and the physical fabric of the district. The second one explores spatial justice theory. This theory analyzes the way in which various forms of justice or injustice are present in the process of spatialization. Spatial justice is one of the most useful terms to depict the social injustices produced by gentrification in cities (Casgrain & Janoschka, 2013, p. 21). Furthermore, theorizing spatial justice has reintroduced the idea of “the right to the city” in present research related to urban studies (Soja, 2010, p. 10). Accordingly, “the right to the city” idea has been used by urban social movements to re-politicize the debate around the functions for which spaces are used and who exactly gets to use them (Harvey, 2005, p. 63). So, I will apply spatial justice theory and “the right to the city” reflections to describe the three major impacts of gentrification on long-term residents of Barranco (cultural and physical displacement from their communities; access restrictions to former public space; and changes on the identity and memories of the neighborhood), and to explore strategies to cope with the new spatialization of the district.
Gentrification, spatial justice, and public space in the contemporary city 2.1
Without a doubt, gentrification has become one of the most popular topics of urban studies. The sociologist Ruth Glass coined the concept of gentrification. In her studies about urban transformations in London, she noticed that working-class districts were revitalized by middle class homebuyers, landlords, and professional developers, causing property values to increase, and working-class occupiers to be displaced. In the end, the rapid urban transformation changed the whole social character of the districts one by one (Glass, 1964, p.22). By the early 1980’s, the term “gentrification’’ could easily be found in different academic papers. It was evident though that the residential rehabilitation that Ruth Glass described in the early 1960’s was only one aspect of the gentrification process. In the 30 years that followed, gentrification theory became broader and it was increasingly recognized as a new phenomenon that presented political and policy-relevant challenges for achieving social justice in urban environments around the world (Lees et al., 2008, p. 9). Based on the process described by Ruth Glass, Neil Smith defined gentrification as:
(…) a physical, economic, social, and cultural instrument of accumulation by ground rent dispossession that involves the incursion of higher income groups in previously low-income neighborhoods and the replacement or displacement of many original occupants. (…) it involved the physical renovation of the housing stock and its upgrading to meet the requirements of its new owners. In the process, housing in both, renovated and non-renovated areas, undergoes a significant price appreciation (Smith, 1987, p. 463).
Since its birth during the 1960’s and 1970’s, gentrification has attracted the attention of national and local authorities, the media, real estate companies and academics that developed a solid theoretical framework based on their researches of cities in England and the United States. Gentrification has become a topic of general interest because it brought a new urban theory that helped to understand the configuration of the city and its social structure. According to Smith, since urbanization processes have been intensified and the metropolis has turned into the main producer of capital, gentrification has become an unstoppable phenomenon (Smith, 2002, p. 434). Likewise, the influence of international capital flows and cultural circulation has transformed gentrification into a worldwide process (Smith, 2002, p. 427). Lees et al. outlined the necessity to study gentrification as a cause of uneven development and displacement around the world (Lees et al., 2015, p. 1). The Latin American metropolis lead the urban growth worldwide (Atlantic
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Council, 2017) becoming crucial environments to produce gentrification theory. Janoschka & Sequera argue that by comparing urban realities from Latin-American cities, meaningful analytical categories could be elaborated to understand paradigmatic yet complementary processes of gentrification (Janoschka & Sequera, 2016, p. 1176). Likewise, gentrification tends to create global cultural products which aim to satisfy consumer groups that have the aspiration to become cosmopolitan and globalized (Atkinson & Bridge, 2005, p.2). For example, in a comparison of two gentrifying Polish neighborhoods in Cracow and New York, the sociologist Jerome Krase concluded that their aesthetics and livelihoods became like those of western cities (as cited by Lees et al., 2015, p. 4). So, although the triggers of gentrification could be different, the final outcome in the neighborhood’s structure, class composition and culture seem to be the same. However, “cosmopolitanism” only considers “western livelihoods” and transforms them into status symbols while it disregards other “non-western livelihoods” that are considered to be unappealing. In that sense, studies of gentrification in Latin American cities have shown that gentrification not only physically displaces indigenous or “mestizo” communities with lower incomes and replacing with whiter affluent classes, it also produces the imposition of aesthetic tastes associated with consumption patterns of white population (López-Morales, 2016, p. 227). Therefore, one could say that gentrification results in a land tenure scheme aiming at a new homogeneous social composition of whiter people with higher incomes and similar tastes.
Gentrification is used as an instrument of urban policy designers to reconfigure urban space for purposes of capital accumulation. They use ambiguous terms such as “regeneration”, “revitalization” or “rebirth” to conceal the negative impacts that these transformations produce (Smith, 1996, p. 30; Smith, 2002, p. 437). Furthermore, in non-western environments (such as those of Latin American cities), when local authorities design urban policies, they link urban renewal processes with the ideal of development, modernization, and progress as a strategy to legitimize gentrification. In those cases, the main objective of urban development is to create urban spaces which produce economic value. Therefore, urban policies prepare cities to function as spaces of consumerism, attracting new social groups and displacing unwanted classes (Hidalgo & Janoschka, 2014, p. 16). In Latin America, such displacement follows different trajectories. Janoschka & Sequera identified the following categories of displacement: by heritage dispossession, by cultural dispossession, and by ground rent dispossession (Janoschka & Sequera, 2016, pp. 1183 - 1187). In the case of displacement by heritage dispossession, two strategies have been combined to displace traditional uses of urban space. The first strategy is social cleansing. It refers to appropriation of urban space by displacing “unfashionable lifestyles” such as street vending, beggary and other “improper” uses. The second strategy refers to controlling and securing certain public areas. The enforcement of these policies involves the application of physical and material violence to avoid “unwanted behaviors” in these public areas. Displacement by cultural dispossession refers to cases where there is a cosmopolitan and touristic extraction of culture. Consequently, the gentrification process is intrinsically related to the valorization of circuits and modes that redefine the cultural activities in touristic urban areas, with the imposition of a new esthetic taste and the devaluation of popular culture following from that. Displacement by ground rent dispossession refers to eradication of informal housing by forced evictions, the burning of old premises, and other material and symbolic relocations. The goal of this type of displacement is to remove the low-income population to other urban areas to give way to new forms of residential living, such as apartments in high-rise condominiums. The result is the reshaping of the physical and social fabric of the neighborhood. Inzulza identified another type of displacement in his research about Santiago de Chile’s inner-city neighborhoods: displacement by the transformation of housing typology. This category refers to the replacing of terraced houses by new medium and high-rise buildings, which are usually occupied by emergent middle-income strata (Inzulza, 2016, p. 1198).
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Several scholars argued that gentrification does not aim to improve the living conditions in cities, but it violates the right of housing, it makes a city more unequal and it ends up turning urban land into a commodity where access is restricted for those who cannot afford it (Brener et al., 2012, p. 8; Ponder, 2016, p. 367; Slater, 2010, p. 294). Likewise, gentrification has redeveloped public spaces into places of leisure and commerce where any other activity is underestimated (Vega, 2006, pp. 36-38). Under this new structure of urban space, the low-income population is confined to fewer available spots while the use of public space is regulated and enclosed for the higher-income population. Therefore, the reconfiguration of cities by gentrification leads to spatial exclusion and to a feeling of marginalization amongst the low-income population, producing injustice based on an uneven distribution of urban land and its resources (Jordi, 2013, pp.63 -64). One theoretical approach to study this effect of gentrification is “spatial justice”. The specific term “spatial justice” was coined by Edward Soja as a result of his research about the spatialization of resources and services in the city of Los Angeles (Soja, 2010, pp. 3 - 13). The concept emphasizes the ways in which various forms of injustice are manifested in the process of spatialization and in which spatial distribution could be seen as an outcome or a process that is just or unjust (Dikeç, 2001, p. 72). It entails three principles: the ontological spatiality of being that describes human relationships as both spatial and social; the social production of spatiality that conceives space as a social creation; and the socio-spatial dialectic that refers to how the “spatial” shapes the “social” as much as the “social” shapes the “spatial” (Soja, 2009, p. 3). Space is a structure created by society and is not merely a physical container of human life (Dikeç, 2001, p. 73). As a result, “social space” produces “representations of space” and “representational spaces”. On the one hand, representations of space are planned, controlled, and ordered. They are produced trough urban planning and they are logically conceived. On the other hand, representational spaces are created by the experience of directly living in the space. It is appropriated in use and it is transformed by social needs (Lefebvre, 1991, p. 291). Consequently, urban space originates from a dialectic between representations of space and representational spaces. It arises between the “conceived” and the “appropriated” and it is also constructed through heterogeneous social groups that use it to express themselves (Mitchell ,2003, p. 129).
Harvey argues that the city is a place of demonstration of power and struggle where individuals express their spatial rights while negotiating spatial claims to others (Harvey, 2005, p. 59). According to Soja, seeking spatial justice is a demand for greater control over how the spaces in which we live are socially produced, so that demand becomes a synonymous of fighting for the right to the city (Soja, 2010, p. 6). Lefebvre’s approach of “the right to the city” entails the liberty of all urban inhabitants to contribute with the production of their social space. Based on Lefebvre’s reflections about “the right to the city”, several scholars have defined a set of rights to put the idea of a more just city into practice and to provide the necessary narratives to enfranchise inhabitants of urban environments (Dikeç, 2001; Purcell, 2002; Earle, 2012). Those rights can be summarized in the following:
1) The right to participate means that urban dwellers should play a central role in any decision that contributes to the production of urban space. It involves their active participation in the political life, management, and administration of the city. (Purcell, 2002, p.103)
2) The right to appropriation refers to the right of dwellers to occupy and use urban space. It promotes the right of people to be physically present in the space of the city. (Purcell, 2002, p.103)
3) The right to centrality refers to the right of the population to live in central areas because they are equipped with infrastructure and services and are closer to opportunities for work, leisure, health, and education. (Earle, 2012, p.8)
4) The right to be different entails the right to not be classified under categories determined by the homogenizing powers. It aims to avoid the classification of certain groups through
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identities imposed upon them or to avoid characteristics that stigmatize them or reduce them into banal representations. (Dikeç, 2001, pp. 74-75)
The spatial dimension of justice has become useful to understand urban development in the Latin American context. According to Caldeira, due to the relentless pace of neoliberalism and to the permanent social and economic inequalities, Latin American cities have produced fragmented environments with fortified enclaves where the fear of violence justifies privatization, enclosing, and monitoring spaces for residence, consumption, leisure, and work (Caldeira, 1996, p. 303). Likewise, Latin American urban policies are transforming public space into a controlled area with the only purpose to promote the consumption of services or products. Similarly, those policies are reducing the capacity of public space to foster simultaneous activities and heterogeneous social groups. One political strategy that accompanies those policies is the establishment of rules and guidelines to discipline and displace “unwanted social groups” (such as street vendors, beggars, political activists, etc.), so the city’s new image is not compromised by their visible presence (Mac Leod, 2002, p. 602). In other words, the fear of inappropriate users has established a solution where the combination of environmental change, behavior modification and stringent policing will become the methods of guarantee that public space will be “safe” rather than hijacked by undesirable users (Mitchell, 2003, p.2). Consequently, Latin American cities have become fragmented fortified enclaves where the most important principles of public space (openness and free circulation of people) have been significantly reduced (Caldeira, 1996, pp. 305 - 307), thus producing spatial injustices. In that regard, Borsdorf et al. argue that Latin American cities are facing a new type of fragmentation. While social sectors with greater economic resources tend to make their living in enclosed spaces (“high-rise condominiums” or “gated communities”), marginal quarters construct fences and gates to protect themselves from the “unwanted” others (Borsdorf et al., 2007, p. 2). As a result, urban environments are becoming internally homogeneous, but externally heterogeneous (since there is no necessity to interact with different social groups).
The response against this background mainly came from urban social movements. Over the last thirty years new strategies were created to cope with contemporary urban planning and to encourage a democratic and fair distribution of public space. As a result, the debate about urban space has developed in three ways: (1) the re-evaluation of space as a determining factor of life-quality; (2) the demand for participative democracy; and (3) the right to participate in urban environment plans (Borja, 1998, p. 5). Thus, urban social movements attempt to reposition the citizen as a subject that must be taken into consideration with the same conditions as private actors when designing and shaping urban policy. Literature about urban struggles in non-western scenarios showed a wide range of strategies that have emerged from the collective action. Most of them are related to claims over spatial rights that can range from self–organization to new interpretations of formal law (Roy, 2007 p. 232 & Earle, 2012, p. 124). In Barranco, where urban space has been fiercely transformed and commodified for residential and commercial purposes, active forms of local responses have appeared. Long-term residents and urban social movements have developed strategies to regain control over public spaces that have been captured by private investments or to prevent the privatization of the few public spaces left in the district.
Research question and operationalization 2.2
The main research question consists of three elements; two elements that are both directly related to gentrification (strategies to promote the urban renewal process and the social effects caused by this process), and a third element that relates to spatial justice (strategies to claim spatial rights). Thereby, the research question that I aim to answer is:
How are the strategies and effects of Barranco’s urban renewal process linked to the spatial rights of the district’s long-term residents?
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- Sub-question 1: What are the strategies of Barranco’s urban renewal process? - Sub-question 2: What are the social effects of Barranco’s urban renewal process? - Sub-question 3: How does Barranco’s urban renewal process affect public space and
what does the population do to claim their spatial rights?
To operationalize the main elements of the sub-questions (strategies, social effects, and spatial rights), I considered López-Morales assumptions about gentrification (see Appendix A). He argues that gentrification should be considered a conceptual category that provides with a comprehensive insight to understand how urban renewal processes produce inequalities and social polarizations in cities (López-Morales, 2016, p.225). Moreover, gentrification entails the strategies designed by the most powerful social groups to capture the city's key spaces and resources for economic and political goals. Finally, gentrification leads to social effects on long-term residents of an urban area. The main negative social effect of gentrification is the displacement of social groups, social structures and uses from urban space. As a result of the displacement, low-income population are located into peripheries and lose their (spatial) rights. Those rights involve participation to decide the uses of urban space and accessibility to its main resources. Gentrification also implies urban policies that entail disciplinary mechanisms to control the behavior of the citizens and displace “informality” or “inappropriate uses” of strategic urban spaces (López-Morales, 2016, p. 227). Hence, any other value that is not considered profitable or lucrative becomes irrelevant to the most powerful groups that make unilateral decisions about the distribution of urban space (López-Morales, 2016, p. 235). To complete all core aspects used for this analysis, one element will be added to the premises of Lopez-Morales: the spaces of political organization and struggle against the conjunction of power between the real estate business (capital) and the exclusionary policies of local authorities.
Methods of data collection 2.3
The research proposal had a qualitative orientation. I selected three methods of data collection: (1) open interviews, (2) photographic comparison and (3) document analysis. With regard to the first method, I conducted 34 interviews with long-term residents and key-informants (see Appendix B). I categorized the interviewees based on two main criteria: to their place of residence in the district,5 and their relationship with the district6. During the design of the research proposal, I identified many of the informants. Moreover, I applied the snowball method to broaden my contacts and to discover new relevant cases. The variety of informants became one key element in my research because it made me encounter contrasting viewpoints about Barranco’s urban renewal process. Furthermore, I got to know the perceptions that the district’s social groups have about each other, which became a key element in understanding the social polarization that the urban renewal process is producing among its residents. I also interviewed activists from urban social movements and local politicians. When I analyzed their testimonies, I discovered tensions and causes of fragmentation and the political game behind the management of the neighborhoods claims. In addition to the interviews, I have attended events where I could find new potential informants. I attended two municipal hearings, one council session, three neighbor’s meetings, three social protests and one forum where I was invited to present the previous results of my research. Both interviews and events where recorded and transcribed. As transcribing was a time-consuming task, I hired an assistant to help me with the process. One issue was not foreseen during the development of the interviews. The informants narrated the facts unsystematically and their ideas were not organized chronologically. Therefore,
5 The Municipality of Barranco divides the district in three main zones (see section 3.3).
6 I developed the following categories: activists, municipal employees, highly skilled professionals, artists and
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I had to reschedule additional meetings with them. The second method combined the use of primary with secondary data. I used pictures to compare physical changes of public space and the district’s landscape during the real estate boom (2007 - 2017). I also captured the characteristics of social protests that opposed to changes produced by Barranco’s urban renewal process. To collect early pictures, I resorted to files from the following sources: pictures of the informants, blog and media publications, and leaflets. Likewise, during the fieldwork, I took more than 700 pictures that become a key element of my analysis. The third method aimed to explore official documents with relevant information about the strategies and narratives of the three central actors of Barranco’s urban renewal process: real estate companies, local authorities, and urban social movements. I organized the information into the following categories: official documents (municipal ordinances, decrees, public-private agreements, zoning plans and urban plans), media publications (webpages, newspaper clips and YouTube videos), advertising material from real estate companies (leaflets, messages, webpages, selling strategies) and information produced by urban social movements (Facebook pages, calls for protests, agreements, presentations, and aide memoires).
Methods for ordering and structuring the information 2.4
In order to arrange the data, I used the following criteria. Regarding to the interviews, I noticed that the informants repeatedly addressed certain topics. I labelled those repetitions according to three categories: (1) perceptions of the changes and uses of urban space before and after the real estate boom, (2) impacts of the new constructions on their daily routines, (3) cases of displacement addressed in the literature (see section 1.3). To determine the social polarization that Barranco’s urban renewal process was producing within the different social groups of the district, I asked the informants opinion about the way they use urban spaces and the way other social groups use the same spaces. Regarding to the documents collected from the real estate business, I organized the information in the following ways. Firstly, I analyzed the advertisement material and I tried to find common patterns within the images and messages about Barranco’s urban renewal process. Secondly, I examined the real estate financial models such as investment possibilities, cost quotes and offers to potential clients. Thirdly, I identified the sale’s target group of the real estate business (e.g.: large scale and middle scale investors, young single professionals, new families, and foreigners). Regarding to the documents collected from local authorities, I identified the presence of the following elements: the justification to privatize public space due to the lack of municipal resources, the justification to grant construction permits because of a need for new residents to increase the number of taxpayers (with a greater number of apartments a greater number of taxpayers) and the use of clientelist campaigns to get votes in the poorest areas of the district. Furthermore, I found cases where municipal authorities use legal tools for political retaliation against members of urban social movements that oppose to their actions, or against social groups that they want to displace (e.g.: inspections, fines, lawsuits, and municipal ordinances to control a specific opponent). To describe the responses of urban social movements towards Barranco’s urban renewal process, I identified forms of neighborhood organization (e.g.: collectives, opposition political parties, grassroot organizations). Then I established patterns to categorize the strategies that they use to control the decision-making power of local authorities over the destination of public space (e.g.: public demonstrations, media presence, contacts with institutions of greater power than the Municipality of Barranco). Finally, I asked the activists opinions about Barranco’s urban renewal process. Most of their testimonies I found out that they believe there is a connection between corruption of local authorities, and the approval of construction permits and the concession of public spaces.
Finding my own path: my experience as a gentrification researcher in Barranco 2.5
Before I started this project, Barranco was just another district for me. For that reason, during the design of the research proposal, I considered important to become a resident of
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Barranco and experience its daily routines and dynamics. The decision to live in Barranco became crucial for the success of this research because of two aspects. Firstly, when I told the informants that I lived there, they felt more confident giving their testimonies. It was also easier to have access to closed forums and Facebook groups of long-term residents and having an address in Barranco allowed me to attend neighborhood meetings which were exclusive to local “barranquinos”. These meetings were either summoned by the mayor or by the neighbors opposing the current municipal administration. Secondly, moving around Barranco by foot or by bicycle enabled me to develop a personal insight about the changes and the impacts that construction works were causing on the district. Moreover, I always carried a camera with me to take pictures when I found something that caught my attention (e.g.: advertisement of new projects, construction tracks blocking the streets, damaged sidewalks, and paths, etc.). When I started with the interview process, I noticed that mostly middle-class professionals, artists, and cultural promoters were more involved in my research project than other social groups. Later I saw that those social groups mostly constitute the urban social movements. It can therefore be said that in Barranco, these narratives are more appealing for people that have either social or economic resources to challenge the new spatialization of the district. These resources could be higher levels of education and better networks with influential actors such as related professional bodies.
Moreover, I had difficulty contacting the following social groups of the district: residents of “Los Malecones”, residents of “quintas” and “solares” and street vendors7. On the one hand, residents from Los Malecones are the wealthiest elites in the district and their economic power differs greatly from the rest of the residents. As much for the other residents of Barranco as for me, the inhabitants of Los Malecones were the least approachable social group. When I arrived to the fieldwork, I tried to meet with them in the district’s public spaces or in the hearings either summoned by neighborhood organizations or by the municipality. They don’t use the district’s public spaces and neither do they attend meetings about the development of the district. By the end of the fieldwork, I had only been able to collect one testimony. On the other hand, residents of “quintas” and “solares” and street vendors are the poorest residents of the district. They usually live and work under informal conditions. Many of them felt that either I was working for the municipality and therefore I was going to report them to “Serenazgo” (the municipal security) or that I was a real estate agent that wanted to expel them from their homes to buy their property. I had to ask two acquaintances (Maria, a house maid who lives on the boundary of zone B and C, and Pablo, a construction worker who lives in zone C) to introduce me to potential informants of these social groups. Their testimonies revealed one important element that will be used for the analysis. They use the public spaces of the districtwith less frequency in comparison to other social groups because they have very little time to spend on leisure activities since they live in a survival economy, which in some cases means that they work from Monday to Sunday. Additionally, they live further away from the main public spaces of the district, which means that it takes too long for them to arrive there.
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3. The spatialization of the problem
This chapter briefly describes the context of Lima’s real estate market. After analyzing tendencies of the real estate business and square meter prices of housing units, I argue that the real estate boom has mainly focused on the central districts of Lima, which includes Barranco. I discuss the intensification of the real estate business in Barranco during the past four years (from 2014 to 2017) because of two main factors, Barranco’s label as Lima’s bohemian district, and the recent trend of local authorities to relax construction parameters to attract real estate developers. Finally, I present the socio-spatial background of Barranco. I argue that due to the socio-spatial and economic characteristics of the district, the urban renewal process is causing a greater polarization and a deeper fragmentation among its residents.
Lima’s real estate boom 3.1
In recent years, Lima has been the scenario of an unprecedented real estate boom (2007 – 2017). During the past ten years, the square meter prices have grown by 293% (BCRP, 2016, p.1; BCRP, 2017, p. 1). The demand and supply of housing units has grown according to these trends8, thus the real estate boom is transforming the spatial structure of the city and urban land has become a strategic resource. Lima – Callao conurbation is distinguished in two geographical areas: Central Lima and Peripheral Lima. Based on their socio-demographic and residential characteristics, the Peruvian Polling Company, Ipsos Apoyo and the Peruvian Chamber of Construccion, CAPECO classify these two areas in seven different sectors (see illustration 3-1) (Ipsos Apoyo 2013, p.7 – 9; CAPECO, 2016, p. viii). For the purposes of this work, only the sectors of Central Lima will be described. The central area of Lima is divided into three sectors: (1) Traditional Lima, (2) Modern Lima and (3) Top Lima. The first sector is formed by the districts of Breña, La Victoria, Rímac, San Luis and “Cercado” (Lima’s historical center) which are the oldest areas in the city. Typical characteristics of these districts are overcrowded dwellings and deterioration of old monumental buildings. These districts have several colonial and republican houses divided into small rooms where low-income families live. In the past years, municipal administrations have implemented programs to recover the monumental area and to reorganize informal housing and commerce in “Cercado”. These programs have attracted tourism, new forms of business, and encouraged investments in the real estate sector. As a logical consequence urban land prices in Traditional Lima, specifically in the historic center, have not escaped from the real estate boom (Castillo, 2015, pp. 138-140). The second sector is formed by the districts of Jesus María, Lince, Magdalena del Mar, San Miguel, Pueblo Libre and Surquillo. Currently, this sector is leading the real estate offer in the city. In an interview for the daily newspaper “Gestión”, Ricardo Arbulú, the director of CAPECO argues that the social middle-class of Lima rather tends to purchase a home in these districts than in the Lima Top districts. He states that this is a consequence of more reasonable prices due to smaller housing units (78 square meters on average). Therefore, he states that the market in this sector responds to a more realistic and non-speculative demand (Gestión, 2017 a). The third sector is formed by the districts of San Isidro, San Borja, Miraflores, La Molina and Barranco. “Lima Top” concentrates the most touristic and recreational areas of the city. It also includes Lima’s business district and consequently brings together the city’s population with the highest income and highest social status. Ricardo Arbulú, states that in this sector the purchasing and selling of housing units is slowly transforming from a dwelling necessity to a speculative investment instrument (Gestión, 2017 a).
8 For instance, in 2007, 2,600 housing units were sold, while in 2016, 11,300 housing units were sold, increasing the figure in 434%. Likewise, in 2007, the supply of appartments was 14,408, while in 2016, the supply of appartments was 24,519, increasing the figure in 170% (BBVA 2009, p. 10; BBVA 2016, pp. 10 - 24).
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Illustration 3-1: Maps of Greater Lima - Peripheral and Central Lima (Source: Ipsos-Apoyo, 2013, p. 7 - 9; CAPECO, 2016, p.75)
Although the growth of square meter prices in the Greater Lima is a transversal phenomenon it is not equal in all the sectors. On the one hand, the square meter prices of the Central Lima area (Traditional Lima, Modern Lima and Top Lima) have always been above the square meter prices of peripheral Lima and have been rising constantly over the past years. While, in the case of Peripheral Lima, the square meter prices have reflected more fluctuations. For instance, in the past six years, the square meter prices in the North Lima sector have only increased by 0.07%, while in the Constitutional Province of Callao, the square meter prices have had a negative growth of -0.19% (see illustration 3-2). This may be because Lima’s peripheral areas, like peripheral areas in other Latin-American cities, are perceived as hostile and unappealing due to poor urban conditions such as a deficient vehicular network, unequal distribution of services and institutions and public safety issues (Kapstein & Aranda, 2014, pp. 44 - 45). Consequently, they remain unprofitable for real estate development. In this respect, Ludeña argues that Lima’s central areas have always been spaces of struggle between high-income and low-income populations:
The “oligarchies” [upper social classes] consider Lima central areas as their only modern and civilized shelter which is separated from the barbarian and uncivilized city… while the poor refuse to be excluded from modernity and try to find their own place of belonging (Ludeña, 2002, p. 62).
In other words, while Central Lima districts are considered enclaves of civilization and development and are disputed by different social groups, the rest of the city (Peripheral Lima), lacking in modernity, services, and infrastructure, is considered a space for the excluded and the marginalized. In this regard, section 4.2 discusses how urban renewal processes all over Lima gradually expand into districts that were once considered peripheral, by changing their social fabric and economic characteristics and making them look more similar than those in central districts. So, for the real estate business centrality is not a fixed concept but a concept in
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expansion. Thus, it could be said that centrality is not only a geographical concept but also a social concept.
Illustration 3-2: Evolution of apartment prices per square meter 2012 – 2017
(Source: adapted by the author from CAPECO; 2012; p.172; CAPECO 2013, p.172; CAPECO, 2014, p. 173; CAPECO 2015, p.175; CAPECO; 2016; p. 155, CAPECO 2017, p.156)
Barranco in the frame of the real estate boom 3.2
Before 2016, CAPECO classified Barranco as a part of Modern Lima (CAPECO, 2015, p.67). In the last four years though, the square meter price in Barranco has intensively increased and has exceeded that of San Isidro (where the city's financial center is located and considered the wealthiest district). According to CAPECO, since 2014, San Isidro square meter price has increased in 4%, while in Barranco it has increased in 22%. At this moment, the square meter price in Barranco is 0,8% more expensive than in San Isidro (see illustration 3-3). Thus, the square meter price in Barranco has been positioned as the highest in Lima and CAPECO now classifies the district as a part of Top Lima (CAPECO 2016, p. viii). According to “Urbania.pe”, the largest Peruvian real estate portal, the increase in Barranco’s square meter price follows from the great appealing that the district has for artists, foreigners, young professionals, and new couples (Urbania.pe, 2017 a). Several scholars specify all these subgroups as potential gentrifying agents (Inzulza 2016, p. 1203; Hubbard 2010, p. 1- 2 & Mathews 2010, p. 661).
Illustration 3-3: Percentage growth of square meter prices in Barranco and San Isidro 2014 – 2017
(Source: adapted by the author from CAPECO; 2014; p.174; CAPECO 2015, p.176; CAPECO, 2016, p. 156; CAPECO 2017, p.157) 0.000 1.000 2.000 3.000 4.000 5.000 6.000 7.000 8.000 2012 2013 2014 2015 2016 2017 Top Lima Modern Lima Traditional Lima Est Lima North Lima South Lima Constitutional Province of Callao S/. 5,901.52 S/. 7,606.00 S/. 7,267.56 S/. 7,545.00 S/. S/. 1,000 S/. 2,000 S/. 3,000 S/. 4,000 S/. 5,000 S/. 6,000 S/. 7,000 S/. 8,000 2014 2015 2016 2017 Barranco San Isidro 22% 4% C en tr al L ima
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Some of the main aspects that attract the attention of the district are its strategic location, its proximity to the sea, its architectural heritage, its traditional fame as a bohemian and cultural district, its extensive offer of nightlife and its label as the “hipster district” (Gestión, 2017 b; Municipalidad de Barranco, 2012, p. 20). Besides, while local authorities of other Lima Top’s districts tend to establish more strict requirements for the construction of new residential buildings, the Municipality of Barranco tends to ease those requirements, thus making it more appealing to the real estate business. For example, the minimum required area for a one-bedroom apartment is 70 square meters in San Isidro, while in Barranco it is only 25 square meters. The situation is the same for parking lots: other districts require a percentage of parking lots for visitors and a minimum of one parking lot per apartment. In Barranco no parking lots for visitors are required and real estate companies can build one parking lot for 1.5 apartments (see table 3-1). In an interview for the financial journal “Semana Económica”, Ricardo Caillaux, general manager of the real estate company “My Home” revealed that one of the main aspects that gives added value to the district is the local authorities’ predisposition to ease construction parameters (Semana Económica, 2015), which currently are the most flexible of all Top Lima’s districts. Likewise, Roberto Rothschild, general manager of “Phorma” construction company, explained for the same journal that it is more attractive for construction companies to build in Barranco than in Miraflores despite that both districts have similar clients (Semana Económica, 2015). Moreover, unlike the other Top Lima’s districts, Barranco has no official regulations to limit the sizes of housing units and number of parking lots per residential building. Nevertheless, even though the Municipality of Barranco has not established those regulations, Ana Victoria Díaz, urban development manager of the Municipality of Barranco9, stated that the real estate companies present projects based on the minimum official requirements established by the Municipality of Lima and the Ministry of Housing, Construction, and Sanitation.
Consequently, real estate companies in Barranco take advantage of this legal vacuum to develop larger projects with a greater number of apartments. So, although the price of the square meter is higher in Barranco, the apartments are smaller and therefore cheaper than in other Lima Top districts. Therefore, this flexibility allows real estate companies to develop more profitable projects since more apartments can be built on the same terrain. Moreover, it is easier for middle-class buyers (young professionals and new families) to purchase their first apartment in Barranco because even though the square meter price is higher, the total cost of the down payment and the apartment itself ends up being lower than in other Top Lima districts. This also means that the high price per square meter in Barranco does not necessarily respond to the quality of the services offered by the district, like safe streets, green areas, or recreation areas, but rather to the profitability for construction companies.
