The Renovation and Financialization of a Postindustrial, Global Chicago

Abstract

To advance the redevelopment of industrial spaces or corridors, financialization instruments such as tax increment financing (TIF) have been employed by the City of Chicago. This instrument particularly enabled the city to attract “billions of dollars in global capital” intended for real estate development. With each new market-rate property’s creation, threats of greater residential gentrification put longtime community members at risk of displacement. The purpose of this research is to assess the transition of urban economies in the wake of postindustrial redevelopment, which has prominently impacted Rust Belt cities like Chicago. Through conducting a literature review, a context will be established of recent financialization trends incentivizing the redevelopment of Chicago’s industrial spaces for the creation of new housing complexes. A data analysis of rent increases over ten-year periods within Chicago’s TIF-funded districts will demonstrate higher housing costs as compared to the city’s median monthly rents. These findings will then be placed against the contentious backdrop of the Lincoln Yards and the 78 construction projects as developments that prioritize global elites instead of everyday residents. Both case studies are predicted to fail at providing affordable housing to Chicagoans, thereby enabling their occupancy by affluent in-movers while lower-income residents are displaced by increasing prices within a competitive housing market. Overall, this research will not specifically explore the impacts of industrial gentrification, but rather the factors that cause its occurrence within a growingly global, postindustrial city like Chicago. To then fight against these comprehensive signs of widening socioeconomic inequality, policy-based intervention is necessary to ensure equity for those most neglected by soaring housing prices. Bans on rent control within Chicago should be lifted to stem potential rent hikes in result of new developments like Lincoln Yards or the 78. Affordable housing should be prioritized by creating programs to enable a larger number of Chicagoans in becoming homeowners. TIF agreements the city has made with projects like Lincoln Yards should also be evaluated and renegotiated to better accommodate housing needs and tax burdens faced by Chicagoans especially within their districts of funding.