Spec­tre of Span­ish gen­tri­fi­ca­tion hit­ting us

In the past decades, there have been a num­ber of ur­ban plans de­vel­oped in the coastal ar­eas of the Mediter­ranean. Some of these projects were com­mis­sioned to in­crease the num­ber of apart­ments and ac­com­mo­da­tion for tourists while oth­ers fo­cused on the city

The Malta Independent on Sunday - - BUSINESS & FINANCE - Ge­orge M. Man­gion Mr Man­gion is a se­nior part­ner of PKF an au­dit and con­sul­tancy firm, and has over 30 years ex­pe­ri­ence in ac­count­ing, tax­a­tion, fi­nan­cial and con­sul­tancy ser­vices. He can be con­tacted at gmm@pkf­malta.com or on +356 21493041.

Tak­ing as an ex­am­ple the city of Mi­jas in Spain, the coast is con­gested and, in my opin­ion, is too full of houses and apart­ments, caus­ing se­ri­ous harm to the en­vi­ron­ment of the area. From 1996 to 2005, 313,000 dwellings were built in the area of Malaga and its prov­ince. Another ex­am­ple is Mar­bella (lo­cated in the Prov­ince of Malaga as well), where some dwellings were built on the front beach line in green ar­eas mainly be­cause of lax con­trols and the mayor’s overzeal­ous ap­proach amidst hints of cor­rup­tion by the ad­min­is­tra­tion. In Ali­cante (near Va­len­cia area), this fac­tor plus the spec­u­la­tion pro­voked un­con­trolled growth of the city which had pro­duced a chaotic touris­tic plan.

It is a known fact that a real es­tate bub­ble dom­i­nated Spain dur­ing this pe­riod and when it burst, it left sev­eral de­vel­op­ers bank­rupt and put at risk the sol­vency of a num­ber of top Span­ish banks. We must re­mem­ber that Spain suf­fered the cruel ef­fect of this prop­erty bub­ble ex­ac­er­bated by the is­sue of un­con­trolled per­mits on use of land, spiced by un­bri­dled spec­u­la­tion and mas­sive con­struc­tion, es­pe­cially in the coastal ar­eas. It is true that while the go­ing was good, Spain (like us rid­ing on a crest of low un­em­ploy­ment) en­joyed a boom and saw lux­u­ri­ous dwellings bought by lo­cals as se­cond res­i­dences. In many cases, lo­cals did a brisk busi­ness sell­ing to for­eign­ers. This mad race gave birth to acute gen­tri­fi­ca­tion. No­body an­tic­i­pated the sud­den ex­plo­sion in sell­ing and leas­ing prices which, as can be ex­pected, pushed prices out of reach of the lo­cals.

Fol­low­ing the tsunamis of prop­erty prices ex­ten­u­ated by the sud­den col­lapse of the bub­ble financed by cheap bank credit, the coun­try faced a large num­ber of empty prop­er­ties and an­gry es­tate agents look­ing for non-ex­is­tent buy­ers. Fur­ther­more, many con­struc­tion com­pa­nies col­lapsed due to over­sup­ply of units since they did not man­age to com­plete the projects. None­the­less, there is some­thing of the zeit­geist about gen­tri­fi­ca­tion. Un­til a few years ago, only aca­demic ge­og­ra­phers and hous­ing cam­paign­ers used the term. In re­cent years, how­ever, the con­cept has en­tered the main­stream and the word has be­come in­creas­ingly ubiq­ui­tous in what seems like al­most ev­ery city across the world.

For in­stance, in the city of Malaga, an im­por­tant ur­ban project took place just a few years ago. A re­newal plan was com­mis­sioned to unify the water­front struc­tures and to im­prove the storm wa­ter sys­tem es­pe­cially in zones plagued with stag­nant wa­ter. Both cities now share the fea­ture of a coastal area geared to pedes­tri­ans, where traf­fic is lim­ited or for­bid­den ex­cept for res­i­dents, en­cour­ag­ing the pub­lic to use pub­lic trans­port. Fur­ther­more, more job vacancies were cre­ated be­cause of en­hanced busi­ness op­por­tu­ni­ties. Fi­nally, due to im­proved de­sign in spa­tial quar­ters, this re­duced pol­lu­tion and the noise lev­els from ex­ces­sive traf­fic.

Can all this re­gen­er­a­tion bliss ever visit this tiny is­land? There are many ex­am­ples in Paceville where de­vel­op­ers have ex­ploited the land to build aw­ful glass and con­crete struc­tures mainly to ac­com­mo­date the grow­ing de­mand for ho­tels, res­tau­rants, bars and of­fice premises rented at astro­nom­i­cal rates to ten­ants with deep pock­ets in the iGam­ing in­dus­try. This has led to a spi­ralling rise in rents which slowly en­gulfed the en­tire is­land. Can this cause a so­cial and en­vi­ron­men­tal dis­as­ter? Is there any end to the race to max­imise profit by de­vel­op­ers rid­ing the high wave of this prop­erty boom? How is the econ­omy ben­e­fit­ting from this short-term ex­ploita­tion of land? What is the en­vi­ron­men­tal dam­age caused by a ca­coph­ony of con­crete struc­tures like the maze we are cursed with when we visit the MIDI res­i­den­tial com­plex in Tigné Point?

MEPA had com­mis­sioned con­sul­tants Mac­Don­ald to de­sign a holis­tic mas­ter plan to res­cue Paceville. This plan (which was never ap­proved due to protests) runs in four main phases. Dur­ing the ini­tial phase, a water­front will be built along the coast­line, from the St Ge­orge’s Corinthia Ho­tel area to Por­tomaso. This faced fierce op­po­si­tion from cer­tain sec­tors, es­pe­cially con­cern­ing dis­agree­ments with land­lords. Both par­ties will have to reach a com­pro­mise in or­der to pur­sue the plan and not up­set own­ers’ in­ter­ests. The ini­tial phase is mainly based on solv­ing the street park­ing in some ar­eas and es­tab­lish­ing re­stric­tions for the rest of Paceville to avoid the cur­rent over­crowd­ing and im­prove the width of the streets. It is pos­i­tive that more park­ing ar­eas for res­i­dents will be built. Thus, Paceville will breathe again with ar­eas that are more open, wider streets and well-de­fined path­ways.

Dur­ing the se­cond phase, a tun­nel will be built to re­duce traf­fic con­ges­tion, specif­i­cally by its en­trance and exit (this re­minds me of the un­der­ground tun­nel promised by the MIDI de­vel­op­ment to re­duce traf­fic by link­ing it to Ma­noel Is­land). In ad­di­tion, a pi­lot cy­cle corri- dor will be cre­ated to en­cour­age the use of more eco­log­i­cal means of trans­port in­stead of cars. Fi­nally, the last phase will in­volve the bus loop con­struc­tion. The in­tro­duc­tion of cy­cle and pedes­tri­ans fa­cil­i­ties will hope­fully lead to greater use of pub­lic trans­port rather than pri­vate cars. But the plan was strongly op­posed by res­i­dents and other en­vi­ron­men­tal agen­cies say­ing that rents and sell­ing prices will rise too much, forc­ing them to leave Paceville (gen­tri­fi­ca­tion phe­nom­e­non).

How­ever, the gov­ern­ment’s bud­get for next year wants to es­tab­lish rules in or­der to avoid un­bri­dled gen­tri­fi­ca­tion and pro­tect the in­ter­est of the ten­ants who are not tourists. Con­sid­er­ing all the data pre­sented in the re­gen­er­a­tion of Paceville, I would agree that the mas­ter plan is a re­spectable one al­beit not bold enough. Although it gave rise to neg­a­tive di­a­logue with the pop­u­la­tion and other NGOs, I think ev­ery­one will agree that the en­vi­rons of Paceville ur­gently need a boost. Cer­tainly, it is im­por­tant to con­trol gen­tri­fi­ca­tion and to en­sure that the au­thor­i­ties prop­erly reg­u­late the is­sue of new per­mits for its re­gen­er­a­tion, tak­ing care of the cit­i­zens’ con­cerns and fol­low­ing the Mac­Don­ald rec­om­men­da­tions by pro­vid­ing and in­creas­ing the util­ity of pub­lic ser­vices in the area. To learn the les­son from Spain, one should never al­low res­i­dents to be held hostage by the pri­vate in­ter­ests of the spec­u­la­tors.

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