Search

This paper develops a conceptual approach to articulate the political-economy inspired literature on the financialisation of cities with a critical reading of collaborative-communicative planning theory to recognise the active role of planners in the multi-scalar, collective 'making' of financialisation by cities. More particularly, I stretch Hilferding's original idea on founder's profit, which was associated with the financial gains obtained from Initial Public Offerings and trading of company shares in open markets. In collaboration with private investors and producers of urban space, planners in cash strapped cities and states search for solutions to invest in better cities by anticipating their exclusive rights to various streams of income, while co-promoting and extracting part of urban founder's profit in doing so. Nevertheless, a communication that is framed around the representational spaces and language of financial models triggers planners' increasing entanglements with finance in the transformation of cities into abstract tradeable income yielding assets. A methodological-heuristic case study illustrates how tracing the models enables us to follow the money, exposing the contradictory role of collaborative-communicative planning and demand for a project with alternative time-space epistemologies. [ABSTRACT FROM AUTHOR]

This article argues that urban governance, and academic theorisations of it, have focused on the role and strategies of real estate developers at the expense of understanding how investors are shaped by regulatory environments. In contrast, using the case of institutional investment in London's private rental housing (Build to Rent), in this article I argue that unpacking the private sector and the development process helps reveal different types of risk which necessitate variegated responses from within the real estate sector. In doing so, I demonstrate the complexities of the private sector in urban development, especially housing provision, and the limitations of a binary conceptualised around pro- and anti-development narratives when discussing planning decisions. Instead, I show the multiplicity of responses from within the private sector, and how these reflect particular approaches to risk management. Uncovering this helps theorise the complexities of governing housing systems and demonstrates the potential for risk-based urban governance analysis in the future. [ABSTRACT FROM AUTHOR]

Recent years have seen a burst of new writing on the opening and closing of urban rent gaps. Such studies generally consider individual cases. Rarely does the opportunity arise to readily compare and contrast rent gaps across multiple cities and territories, least of all within the context of a single developer or investor portfolio. Such an opportunity has arisen in the past decade, however, as the US investment firm Blackstone has pursued a multi-territory housing-investment strategy specifically of identifying and closing rent gaps, which it styles 'buy it, fix it, sell it'. This article examines that strategy and the varying nature of its implementation in Danish, German, Swedish and US cities. It argues that the rent gap is a paradoxical phenomenon: vast gaps, promising vast profits, frequently open up and frequently remain open for long periods before being closed – if they are closed at all. A primary reason is that successful and profitable closure requires not just favourable local political-economic conditions but a singularly well-funded, determined and aggressive investor – an investor, that is, such as Blackstone. [ABSTRACT FROM AUTHOR]

This article engages a long-established paradigm within urban studies: that of the transition from managerialism to entrepreneurialism in late 20th-century urban governance and the associated process of neoliberalisation. It begins from a fundamental intellectual problem; although we are well served with studies of urban entrepreneurialism and neoliberalism, we know surprisingly little of the detailed workings of the 'pre-neoliberal', managerial era from the 1940s to the 1970s. In the absence of sustained investigation of this period, many chronologies and critiques of urban transformation rest upon a set of assumptions which – as this article shows – are not always accurate. The article focuses upon Britain, tracing the installation of a modern planning regime in the 1940s and surveying some key features of the UK urban redevelopment regime as it evolved over the ensuing decades. It shows that much of what is held to be paradigmatic of neoliberal urbanism (public–private partnerships, urban entrepreneurialism, financialisation) was already powerfully present within British urbanism in the earlier, managerial era. I highlight in particular the dramatic post-war rise of the UK property development industry, and the new urban forms and norms it generated, as a key product of the era of urban managerialism in Britain. I relate these surprising findings to Britain's distinctive history and political economy but I also advance arguments that are of wider relevance; around the nature and aims of governance from the 1940s to the 1970s, and how we should best conceptualise and explain processes of neoliberalisation. [ABSTRACT FROM AUTHOR]

While housing has been a central object of financialisation, questions regarding how multi-scalar states shape the financialisation of housing remain under-researched. I address this knowledge gap through a case study of the financialisation of affordable housing in Toronto. By analysing pertinent policy documents, I examine the roles and relationship of the federal, provincial and local states in the financialisation of affordable housing. Two findings are highlighted. (1) Although policies from all levels of government show traits of financialisation – in terms of both the connection between social policy and financial markets, and financialised ideologies prevailing in policy discourses, the extent and pattern of the manifestation of financialisation are distinct. This research thus calls for a nuanced understanding of the state's role in the financialisation of housing from a multi-scalar perspective. (2) Affordable housing policies usually do not give an explicit definition of 'affordable'. By scrutinising the policy specifications, I found that the target group is mainly moderate-income, rather than low-income, households. It will be increasingly difficult for low-income households to meet their housing needs. [ABSTRACT FROM AUTHOR]

It has been averred that there is an international market in housing (inter alia, Adams Z and Füss R (2010) Macroeconomic determinants of international housing markets. Journal of Housing Economics 19(1): 38–50; Helbling T and Terrones M (2003) When Bubbles Burst – Chapter II, World Economic Outlook. April. Washington, DC: IMF; Pomogajko K and Voigtländer M (2012) Co-movement of house price cycles – A factor analysis. International Journal of Housing Markets & Analysis 5(4): 414–427). Although some authors examine the business cycle range, the mechanism by which this comes about is more likely to reflect financial market integration and evidence for this should be found in the medium-term cycle range. As a case study, there is an analysis of three associated 'regional' housing markets and their price movements. Northern Ireland's economy is distinct but should be linked to the rest of the UK by common policy shocks, and to Eire through a mutual border. Using a Friedman test, it is found that even this small cluster is not integrated. It is asserted that a housing cycle has both a financial and a business component. As Drehmann et al. (Drehmann M, Borio C and Tstasaronis K (2012) Characterising the financial cycle: Don't lose sight of the medium term! BIS Working Papers, No. 380, Bank for International Settlements, June) argue, cycles in the medium-term range are significant in housing. A dual component approach highlights the relevance of cyclical interaction for both revealing integration and the need to intervene to moderate cyclical reinforcement for crisis-avoidance. After 1995, Dublin and London are found to be more integrated than before, which is consistent with the international city integration thesis of Holly et al. (Holly S, Pesaran H and Yamagata T (2011) The spatio-temporal diffusion of house prices in the UK. Journal of Urban Economics 69(1): 2–23). Lastly, a simple test for cyclical asymmetry indicates that there is highness (the obverse of deepness, where the troughs are deeper than peaks) in the UK financial cycle. [ABSTRACT FROM AUTHOR]

Taking as our focus the city of London over the last decade, we use state-held records of house sales to consider the impact of competition for housing resources in the luxury property market. This data suggests that the use of offshore investment vehicles and the concealment of wealth from national tax agencies have become key mechanisms by which housing resources have been exploited by the wealthy and their capital deployed by agents of the rich. Using the concept of wealth chains, we consider these methods of capital accumulation as these extending flows of managed capital become 'anchored' within specific urban spaces, in this case the luxury housing market of inner West London. Our analysis of a selection of these chains shows that the prevailing political management of the property economy benefits those already winning the war of inequality while looking to augment their capital and shield it from tax and regulation. The ultra-wealthy, financial intermediaries and multinational corporations have created chains articulated across space, with the effect of undermining the value of dwellings as homes, and have replaced them with assets to be traded in pursuit of private and offshore wealth gains. The result is an urban context that favours already advantaged and powerful interests and enables the avoidance of tax obligations desperately needed at a time of austerity and intense housing need. [ABSTRACT FROM AUTHOR]

The entrepreneurial city discourse has been adopted around the globe by policymakers, with the urban redevelopment project as one of its most representative symbols. The predominantly favourable discourse revolving around this new political economy of urban space is supported by claims that newly regenerated areas bring multiple benefits to the city and its citizens. These narratives have been used in Brazil to justify increasing reliance on an urban planning tool known as Urban Operations. This planning tool, developed in the 1990s, seeks to facilitate cooperation between public and private actors in the production of new urban spaces. While projected by some as a 'magic formula' that enables major urban redevelopment projects without public expenditure, the outcomes of Urban Operations often differ significantly from expectations. The cases of Água Espraiada (São Paulo) and Porto Maravilha (Rio de Janeiro) are used to demonstrate that regenerated areas, as preferred spaces for the penetration of financialised practices into the built environment, have brought forward new dynamics that are serving to reinforce pre-existing social inequalities and to exacerbate uneven development in Brazil's main cities. [ABSTRACT FROM AUTHOR]