Gen­tri­fy­ing Mar Mikhael

Has Mar Mikhael’s re­ju­ve­na­tion spelled its down­fall?

Executive Magazine - - Contents - By Na­bila Rah­hal

“We grad­u­ally no­ticed a few aban­doned com­mer­cial venues be­ing ren­o­vated and then new ten­ants mov­ing in. They were mainly lit­tle bou­tiques owned by young adults and at first we felt a sense of pride that peo­ple were rec­og­niz­ing our neigh­bor­hood as a place for cre­ative busi­ness ac­tiv­i­ties but now, with all the bars and the traf­fic and the noise, it’s just too much!” says Agop Bar­be­rian, an old time res­i­dent and elec­tron­ics re­pair shop owner in Mar Mikhael. He re­calls how his once al­most forgotten neigh­bor­hood emerged as a des­ti­na­tion for de­sign­ers less than a decade ago, and how it rapidly turned into what he now com­pares to an in­sa­tiable mon­ster.

MAR MIKHAEL’S UR­BAN FAB­RIC

While dis­tricts such as Monot and Gem­mayze have roared with nightlife since the 1990s, Mar Mikhael was con­sid­ered a low to mid­dle in­come, mainly industrial area where many car ser­vices out­lets, metal work­ers and work­shops could be found. Th­ese venues gen­er­ated rea­son­able ac­tiv­ity dur­ing the day, of­ten noisy or smelly, es­pe­cially when in­volv­ing car re­pairs, but the evenings were al­ways calm, re­calls Bar­be­rian. The area, with its nar­row streets and ar­chi­tec­ture dat­ing back to the 1940s, re­tained a some­what charm­ing mode of ur­ban life that was fad­ing away in other ar­eas of Beirut.

Speak­ing about what makes peo­ple ap­pre­ci­ate an ur­ban area such as Mar Mikhael, Mona Harb, as­so­ciate pro­fes­sor of ur­ban stud­ies and pol­i­tics at the Amer­i­can Uni­ver­sity of Beirut, ex­plains that it is more than just the old build­ings. Rather, ac­cord­ing to her, the ap­peal lies in the very fab­ric of the dis­trict, such as the nar­row streets sig­ni­fy­ing a time be­fore the in­tro­duc­tion of pri­vate cars to Le­banon, the lit­tle gar­dens in front of build­ings where the neigh­bors gath­ered, and the stair­ways fa­cil­i­tat­ing a climb over a steep hill. All of th­ese el­e­ments gave the neigh­bor­hoods that had de­vel­oped on the then-out­skirts of cen­tral Beirut — such as Furn El Hayek, Zokak El Blat, Ain El Mreis­seh and Gem­mayze — a hu­man side.

DE­SIGN­ERS MOVE IN

This charm was one of the main fac­tors that first at­tracted those in the arts, crafts and de­sign (ACD) in­dus­tries to Mar Mikhael. “I fell in love with the wide space when I first saw it and I loved the industrial feel of the area,” says Maria Halios, in­te­rior ar­chi­tect and founder of MHD De­signs, who trans­formed an aban­doned choco­late fac­tory in Mar Mikhael off Ar­me­nia Street into her of­fice and de­sign show­room early in 2009, when there was only Li­wan, a con­tem­po­rary de­sign bou­tique, on that street.

Ra­nia Na­u­fal, owner of the arts and ar­chi­tec­ture book­store Paper­cup, has been living in Mar Mikhael since 2005 and cites the “vi­brant charm” of the area as the rea­son she opened her book­store there, a few months af­ter Halios.

To­day there are ap­prox­i­mately 71 com­mer­cial venues rented out to the ACD in­dus­try in Mar Mikhael in­clud­ing bou­tique re­tail stores, de­sign stu­dios and of­fices, ac­cord­ing to the Mar Mikhael Cre­ative Dis­trict map de­vel­oped by Ge­orges Zouain, prin­ci­pal of GAIAHer­itage, with fi­nan­cial as­sis­tance from the Euro­pean Union un­der the MEDNETA project. GAIA-Her­itage is a Beirut based com­pany founded by Zouain in 2002 which pro­vides con­sul­tancy ser­vices to man­age cul­tural and nat­u­ral her­itage. As part of the EU funded MEDNETA project, GAIA-Her­itage launched on Jan­uary 16 a week long con­fer­ence en­ti­tled “In Mar Mikhael” aimed at re­gen­er­at­ing Mar Mikhael and re­in­forc­ing cre­ativ­ity in the area.

Harb ex­plains that ACD pro­fes­sion­als were at­tracted to Mar Mikhael be­cause of sev­eral fac­tors: its

cen­tral lo­ca­tion, its ur­ban fea­tures, its prox­im­ity to Bourj Ham­moud — where many of the crafts­peo­ple are lo­cated — and be­cause the rents were low when they first moved in. They did not fun­da­men­tally dis­rupt the so­cial and eco­nomic life of the neigh­bor­hood.

As Mar Mikhael be­gan to blos­som as a “hip” neigh­bor­hood where the ACD in­dus­try could be found next door to me­chan­ics in an in­dus­tri­al­ized yet artis­tic en­vi­ron­ment, it caught the eye of real es­tate de­vel­op­ers, who saw an op­por­tu­nity to use the area’s con­tem­po­rary feel as a mar­ket­ing tool to de­velop and sell their prop­er­ties there. “The de­sign­ers some­how par­tic­i­pated in the pro­mo­tion of res­i­den­tial real es­tate as we were used in their pro­mo­tional brochures. Peo­ple find it nice to live in a hip area,” says Halios.

AND HOS­PI­TAL­ITY VENUES MOVE IN

Around the same time, to­wards the end of 2010, hos­pi­tal­ity de­vel­op­ers who were fed up with the high rent costs or over­crowd­ing of places such as Down­town’s Maarad street or Hamra were look­ing for a new area to ex­pand into and found Mar Mikhael to be per­fect for their needs. Like the de­sign­ers, they were en­ticed by its prox­im­ity to Gem­mayze, its low rents and ur­ban her­itage charm. Very quickly, two or three pubs on Ar­me­nia Street pro­gressed into more than 40 hos­pi­tal­ity venues, with more slated to join the mix in 2015.

With this rapid real es­tate devel­op­ment, Mar Mikhael has be­come un­rec­og­niz­able to its long time res­i­dents who com­plain of not find­ing any­where to park, of the in­tense traf­fic, of the loud noise at night and of hav­ing to pick up bro­ken bot­tles and de­bris from their doorsteps ev­ery morn­ing.

Com­mer­cial rental prices were driven up by the boom in the area and land­lords who were charg­ing a mere $600 per month for a 50 me­ter square com­mer­cial venue back in 2009 are now ask­ing for, and get­ting, $3,500 a month, a 483 per­cent in­crease. While part of this in­crease is due to nor­mal mar­ket in­fla­tion, part is also due to op­por­tunism among land­lords.

IT’S ALL ABOUT THE MONEY

Con­cen­tra­tions of hos­pi­tal­ity venues tend to be tran­sient in Le­banon: they have mi­grated from Monot to Gem­mayze to Hamra to Uruguay Street and now to Mar Mikhael, with many al­ready mov­ing now to Badaro. All of th­ese des­ti­na­tions be­came in­tensely popular for an av­er­age of three years, be­fore the cus­tomers and op­er­a­tors moved on. Many land­lords are seiz­ing the nar­row time frame to max­i­mize their prof­its and are ask­ing for sig­nif­i­cantly in­creased rent from their com­mer­cial venue ten­ants, evict­ing them when they can’t pay and their rental agree­ment is up, or pay­ing them the key money they owe them, if they are on the old rental agree­ment, and giv­ing them a month’s no­tice to pack their bags.

Vic­tor Hamd­jian is stand­ing in front of the small garage where he now works as an em­ployee. He points to the larger garage down the street which he used to op­er­ate him­self on a prop­erty he rented, but has now been rented to a restau­rant. Hamd­jian names seven other industrial busi­nesses, all in just two al­leys off Ar­me­nia Street, which have closed down in the past two years to make way for a restau­rant or bar. Hamd­jian ex­plains that it is not only the in­creased rents which have driven th­ese busi­nesses away, but says the whole area is chang­ing and there is no room for them any­more.

Zouain ex­plains that a mar­ket only thrives by the ag­glom­er­a­tion of trades that com­ple­ment each other, which was the case with the industrial work­ers in Mar Mikhael and also with the ACD in­dus­try to­day. How­ever, un­for­tu­nately this is slowly fad­ing from the area in fa­vor of hos­pi­tal­ity venues.

Many of the de­sign­ers feel that the area is chang­ing in terms of what first at­tracted them to it and worry that they will not be able to com­pete rent-wise with the wealth­ier hos­pi­tal­ity venue own­ers in the long run. “Two years ago, the hos­pi­tal­ity in­vestors be­gan mov­ing into the area and so now you see fewer de­sign­ers open­ing up here. Restau­rants are pay­ing more in terms of rent so com­mer­cial real es­tate own­ers pre­fer them as clients as op­posed to us de­sign­ers,” ex­plains Halios, adding that her rent con­tract will end in June. While she is not sure if her land­lord will in­crease the rental fee, she is con­fi­dent that her land­lord will not rent the venue to a pub as she wants to pre­serve the street’s qual­ity.

Na­u­fal says her rent has in­creased since her con­tract was first is­sued but is still “vi­able and re­al­is­tic.” She adds: “How­ever, I did hear of other land­lords in the area who are be­ing ex­tremely greedy at the risk of los­ing their cur­rent ten­ants and chang­ing the spirit of the neigh­bor­hood.”

Halios wishes new young de­sign­ers would open shops in Mar Mikhael but knows that this is un­re­al­is­tic at this point and fears that the sense of com­mu­nity that was cre­ated among de­sign­ers in the area is be­ing de­stroyed. “It’s a pity though be­cause we re­ally built a con­nec­tion with this area and helped shape it. We have good en­ergy and good com­mu­ni­ca­tion be­tween us in the neigh­bor­hood and or­ga­nize events among each other for the street,” she says.

WITH THIS RAPID REAL ES­TATE DEVEL­OP­MENT, MAR MIKHAEL HAS BE­COME UN­REC­OG­NIZ­ABLE

BAL­ANC­ING ACT OF GEN­TRI­FI­CA­TION

Gen­tri­fi­ca­tion is not unique to Mar Mikhael or even new to Beirut, as Harb ex­plains. Monot and Furn El Hayek went through it in the 1990s, but with less in­ten­sity than Gem­mayze and Mar Mikhael.

How­ever, adds Harb, gen­tri­fi­ca­tion could bring eco­nomic op­por­tu­ni­ties for the city and its res­i­dents if it is man­aged in a way that takes into ac­count public in­ter­ests. Halios says that some of the restau­rants in the area, es­pe­cially those that open on Satur­days for lunch, com­pli­ment their ACD venues and gen­er­ate some added busi­ness for them. “Since the restau­rants opened, we have had in­creased foot­fall to the area and in our busi­nesses. I am see­ing some new faces that are not my usual clients. The pos­i­tive ef­fect of the pres­ence of such restau­rants in Mar Mikhael is that a crowd of po­ten­tial clients are dis­cov­er­ing the area be­cause of them,” says Halios.

As one land­lord, who is cur­rently us­ing his prop­erty as an elec­tron­ics re­pair shop for cars, puts it, “I am ask­ing for $150,000 an­nual rent for my shop be­cause it is big. If I get it, I will gladly rent it and re­tire: who keeps on work­ing like this when they can just re­lax and have money de­liv­ered to their doorstep?”

“The chal­lenge is how much one wants to de­velop an area eco­nom­i­cally with­out destroying its her­itage. It is a bal­anc­ing act,” says Zouain, ex­plain­ing that GAIA-Her­itage doesn’t want to pre­vent con­struc­tion or harm the econ­omy. Rather it wants to do what should be done in any city that grows in an or­ganic and har­mo­nious man­ner: bal­ance the in­ter­ests and needs of the com­mu­nity with the need of the in­vestors. This is what the “In Mar Mikhael” con­fer­ence is at­tempt­ing to il­lu­mi­nate.

Harb also speaks of the im­por­tance of bal­anc­ing pri­vate eco­nomic in­ter­ests and public in­ter­ests when it comes to devel­op­ment of a neigh­bor­hood with re­mark­able ur­ban her­itage such as Mar Mikhael where gen­tri­fi­ca­tion risks are high. “The prob­lem is that we lack a strong public agent, such as the mu­nic­i­pal­ity, will­ing to im­ple­ment ex­ist­ing ur­ban plan­ning reg­u­la­tions that can pro­tect the public good, of which ur­ban her­itage is a key el­e­ment, and to re­strict the free­dom of pri­vate real es­tate de­vel­op­ers who will al­ways look for ways to en­rich them­selves,” says Harb.

This lack of reg­u­la­tion ap­plies to res­i­den­tial real es­tate as well. Real es­tate de­vel­op­ers have been ob­tain­ing sev­eral small lots, which, by them­selves, are not big enough for huge de­vel­op­ments, but when joined form a big piece of land which they can then build high rises on, as is ev­i­dent by the three tow­ers al­ready pro­trud­ing awk­wardly amidst the short build­ings of Mar Mikhael. While this is not il­le­gal, not reg­u­lat­ing it could lead to Mar Mikhael be­com­ing a jun­gle of tow­ers and los­ing its ur­ban iden­tity, says Harb.

The ironic as­pect, ex­plain both Zouain and Harb, is that com­mer­cial and res­i­den­tial real es­tate de­vel­op­ers, through their un­reg­u­lated growth and the ris­ing rents they bring to the area, end up destroying the very el­e­ments that first at­tracted them to it, namely its au­then­tic charm. “What is go­ing to hap­pen if we leave the mar­ket to­tally free is that all those who want to buy the de­vel­op­ers’ con­do­mini­ums in Mar Mikhael be­cause the neigh­bor­hood has a charm­ing flair will end up living in a place that is as dull as any other place in Beirut and will move on,” says Zouain, adding that this, in the long run, will lead to the rental prices go­ing down again for both the com­mer­cial and res­i­den­tial projects.

Through the “In Mar Mikhael” con­fer­ence, Zouain is hop­ing to ini­ti­ate dia­logue be­tween the res­i­dents, the ACD in­dus­try and the in­vestors on how they are all shar­ing and shap­ing the Mar Mikhael of to­day and what their com­mon needs are. His next aim is to make the mu­nic­i­pal­ity of Beirut, the Min­istry of Cul­ture and the real es­tate de­vel­op­ers aware of the im­por­tance of pro­tect­ing Mar Mikhael’s ur­ban fab­ric be­fore it is too late. “We are fight­ing it but I don’t know if we can re­ally do any­thing: we are try­ing with our good­will, the tools and knowl­edge we have. We will see what will hap­pen but it is very long term,” concludes Zouain.

GEN­TRI­FI­CA­TION IS NOT NEC­ES­SAR­ILY HARM­FUL AND THERE IS OF­TEN A GAIN FOR THE CITY AND ITS RES­I­DENTS

Mar Mikhael is now a cen­ter of de­sign in­dus­tries in Beirut

The hos­pi­tal­ity in­dus­try in Mar Mikhael has boomed in re­cent years

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