Summary

On this website you will find a lot of information about the problem of how small businesses can be negatively affected through the process of gentrification, and potential solutions. Below is a summary of the topics that we cover.

The Problem: Unchecked gentrification will lead to the involuntary displacement of small businesses that are critically important to a community. It will also prevent new businesses that would be culturally relevant and beneficial for the community from opening in the future. These outcomes will damage the community by harming its cultural and social identity, making jobs harder to find, weakening the economy, and making the community less stable as a whole.

When the government invests more public dollars in a neighborhood, one of the results is an increase in the value of the land there, which can lead to gentrification (the process by which the essential character of a neighborhood is changed as higher income households displace lower income residents). While this investment increases property values, the sudden spike in rental prices disproportionately impacts disadvantaged business owners who are (often rapidly) priced out of their communities. As the chart below demonstrates, this is already underway in South Seattle, where general retail rents have increased four times faster than Downtown Seattle. 

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Source: King County Property Assessor’s Office 2015 Area Reports

The Assessment Report for South Seattle goes on to conclude: “Neighborhoods with good transit amenities such as link light rail and the First Hill Street Car (service to begin in 2015) appear to be most attractive to developers. These land sales support an increase in the assessed land values for most of the zoning designations in the 2015 revalue and support an overall land value increase of 12.24%.”

The character of a community is profoundly impacted by the local and culturally appropriate businesses that serve it, yet the effect that gentrification can have on these businesses often goes under the radar. On this website, we will examine permanently affordable commercial space as a potential tool to prevent the displacement of businesses in communities experiencing gentrification. We focus on the concept of mission-driven entities (such as non-profits and public development authorities) buying land and reserving it for low-wealth, culturally appropriate businesses so they can continue to succeed and thrive in their communities.

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Canton Alley small businesses in Seattle’s rapidly gentrifying Chinatown International District

Who Could Provide Commercial Space

We believe there are three entities that have the potential to buy property for the purposes of providing permanently affordable commercial space:

Land is a scarce resource, and having it owned by mission-driven (rather than profit-driven) organizations achieves three things:

  1. It takes land off the market.
  2. Reserves space for community use.
  3. Makes sure it will stay affordable for an extended period of time.

How to Lease Permanently Affordable Commercial Spaces
Once these organizations buy and develop property for commercial space, they need to ask: what will happen to the space, who will benefit from it, and for how long? We believe these questions can be answered through “community-based commercial leasing ”, which will ensure maximum community benefit and good stewardship of these spaces. The following models and strategies for operating and leasing are tools organizations can use to achieve the best use of their commercial spaces: 

Other Alternatives to Permanently Affordable Commercial Space
While acquiring and setting aside spaces for local businesses to rent for an affordable lease is a long-term solution to displacement, it is not always an option, or even the best one. On this website, we also cover a few other methods and resources that may help businesses facing the negative effects of gentrification.

There are three affordable business models we discuss:

As well as four types of business assistance:

Ultimately, for organizations and communities to be successful in tackling the negative effects of commercial gentrification, they must consider the unique situation and needs of their neighborhood and its residents.

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