Should You Open Up Shop In a Neighborhood That's Being Gentrified?

Jan 10, 2018 | Jessica Ogilvie

Ever since Williamsburg got yuppified in the mid-aughts, it seems like gentrification has been the word on everyone’s minds. (It’s been an issue since way before that, but that’s when the latest version of the conversation seems to have gotten started.) Formerly-working-class neighborhoods from Los Angeles to New York and everywhere in between have become havens for low-income artists, musicians, and students. That makes the area popular for others, who bring in new businesses and a lifestyle that may not be affordable for those who have lived there for decades. Often, these changes push existing residents out.

It’s a catch-22 for small businesses who are deciding where to open up shop. On one hand, there are moral considerations tied to being a part of a movement that ultimately kicks lower-income people out of their houses and places of business. On the other hand, these neighborhoods usually offer low rent (at first), and the cache of being among the first to “discover” (like how Columbus discovered America!) a hip new area.

But that’s not the only concern when it comes to gentrification. Rather than pull neighborhoods together, new shops that are out of sync with the existing spirit of the area run the risk of dividing old and new residents, as outlined in a recent article in the Wall Street Journal.

Out with the Old, or in with the Nouveau Riche?

The story covers Industry City, a six-million-square-foot warehouse complex in Brooklyn’s Sunset Park. Over the past few years, Industry City has gone from simply storing goods to housing hipster shops such as Maglia Rosa, a custom-bike-shop-cum-Italian-café, as well as landmark upscale shops like ABC Carpet & Home.

But the complex does not seem designed with Sunset Park longtime residents in mind. The neighborhood’s median household income is $40,576, and 33.7 percent of its residents live below the poverty level. That discrepancy has borne out, reports WSJ. As far as whether Sunset Park residents visit and shop at Industry City, One Girl Cookies co-owner Dave Crofton tells the paper that back in 2014, his customers were rarely from the neighborhood. “Now I get a few folks a week,” he says. But Crofton adds that those customers are more likely to be new arrivals to Sunset Park — perhaps enticed to move there because of Industry City — than residents that have been around for a while. “I don’t know anyone old school, of that demographic, that comes here,” Crofton tells the paper. The disregard for one another cuts both ways. Industry City business owners interviewed by WSJ reported rarely leaving the warehouse complex. “You have everything you need here,” product developer David Vitully says in the story. “They built out the courtyards. They have bars. Mini golf. Ping pong.”

Resisting Change, or Fighting Against Colonization?

Sunset Park isn’t the only area facing a disconnect between longtime residents and newcomers. Boyle Heights in Los Angeles, a neighborhood with deep Latino roots and many families who have called the area home for decades, has faced down coffee shops and art galleries trying to open up shop in the area thanks to the low rents. Groups such as Boyle Heights Against Artwashing and Displacement and Defend Boyle Heights have been protesting such upscale businesses since 2015. Lifelong Boyle Heights resident Marisol García told LA Weekly in July, “We’re being colonized… It’s like we’re supposed to adapt to what’s becoming their neighborhood.”

What’s a Small-Business Owner to Do?

Before setting up shop in an area just because rents are low, engage with the community.

  • Take some time to visit with neighbors and see what they want and need in the area. Can you help, or are you imposing something on them that will eventually lead to their displacement?

  • Take the temperature of the neighborhood; each up-and-coming area might not have protesters as loud and active as Boyle Heights, but find out whether there is dissatisfaction about the direction the neighborhood is going.

If there is a great deal of unhappiness with new shops moving in, understand that opening there will have consequences. You may not be liked right away (if at all), and you may inadvertently contribute to people’s dislocation. You may also run up against some difficulty in moving in. There might not be protests, but there might be pushback.

From there, it’s up to you. Some believe that gentrification is simply progress, and is, as such, inevitable. Others don’t like the idea of kicking people out of their long-standing homes, even if it does come with a cushy relocation fee. That gentrification is such an old phenomenon only proves that there are no easy answers. But being a good business owner means engaging with your community, or with a community you hope may be yours. Go in with your eyes and ears open.