By Abigail Scheidel
A $425 million waterfront investment in the first and sixth wards of Allentown is promising 12 new buildings, a 200 seat amphitheater, and a Riverwalk trail along the Lehigh riverfront. This is being developed by Jaindl Enterprises, a family business run by the Jaindls who have been in Allentown since 1904. Developments like the Waterfront can bring an exciting new blend of apartments, shopping and recreation to the area, but residents who live nearby are fearful they will see rising rents.
Residents living on either side of the riverfront are nervous that their quality of life and livability will be impacted because of the redevelopment. Under a Facebook post from the Morning Call about Zachary Jaindl, co-founder and COO of Jaindl Enterprises, and his motivation for this redevelopment, enraged Allentown residents accused him of being motivated by profit. The Morning Call article focused on Jaindl and how his family has many businesses across different industries, yet they still want to be a part of Allentown’s revitalization to help the city realize its potential.
One Facebook user commented under the post, “Maybe a real unbiased reporter one day will report on the destruction this family has caused to the Lehigh Valley. Sold to the highest bidder! That is the Jaindl way. It is all about making money.” Another person commented, “How mighty generous for them to ‘give back.’ Guaranteed it is going to fill their pockets. They don’t do anything unless they are profiting immensely from it!” These residents fear gentrification–that Jaindl’s developments in the city will push out those who are not economically advantaged, raising rents and making it difficult for people with lower incomes to live comfortably in the city.
“Gentrification goes through several steps,” explained Dr. Bruce Mitchell, a senior research analyst at the National Community Reinvestment Coalition, “beginning with [developers] moving in, the area becoming trendy, attracting wealthy people, employment rates going down because rent goes up and home values go up, and then the current residents are driven out because these renters are vulnerable.”
According to Allentown’s Neighborhood Planning, there is a 31% poverty rate in the first and sixth wards, the area of Allentown that is seeing this new construction. The city of Allentown has a 25.7% poverty rate, which means a large portion of that comes from the first and sixth wards. There is also a high proportion of rentals, with 33.3% of people owning homes and the remaining 66.7% renting. “It is central that affordable housing units are put in place as a part of the redevelopment plan,” said Mitchell. “However, affordable housing is not profitable for developers, so they want to put in place buildings that will demand the highest rent, this limits affordable housing.” It is only possible that rising rent can be mitigated, if the community and investors are on board.
“A way that residents can help with this is to become more involved in the redevelopment process so that their interests can be represented,” suggested Mitchell. This can be done by attending community meetings to voice concerns of the redevelopment process and also to understand what is occuring.
When a longtime resident voiced his concerns about the rising rents, explaining that apartments used to cost $400-$500 a month are now increasing to $700 and may still rise, he was quickly shut down by Carlos Tovar, the owner of Diseno Urbano, a city developer. In a July community meeting, Tovar introduced his plans for the development occurring across North Front Street. The changes he wanted to make focused on an underdeveloped area that would transform into public plazas, a playground, state of the art buildings, and better greenery. He promised job opportunities, a better quality of life, and building a community for all. Another resident added, “I still have my guard up.”
Lower income residents will be the ones who pay the price of gentrification if it occurs in the city because they will be forced to move out of the city in search of cheaper rent. “They may be displaced because of decreased affordability and they will generally move further and further out of their communities,” Mitchell added.
Another driving source for gentrification is the rent gap. “As time goes on in a developed place, the value goes down because the structures age, the neighborhood is less trendy, it is not a fashionable place anymore, it is a place that is going through structural deterioration.” Mitchell continued, “as the value goes down, there is potential for the rents to increase over time. If it is a desirable place where people want to live with access to jobs, transportation, a waterfront, etc., a rent gap may occur because there is a potential profit versus the actual value.” In other words, landlords could increase rents on apartments without offering any additional value simply because the area has become a hot market for development.
The redevelopment in Allentown began with a partnership between the city and developers that is driving this process of gentrification. The new luxury apartments and high end dining is intended to attract wealthier people to the area. “The area will then become unaffordable and the lower income residents will be displaced,” Mitchell explained. But this is already happening, and Allentownians are feeling the crunch. In a recent Morning Call opinion article, Alan Jennings, former executive director of the Community Action Committee of the Lehigh Valley, detailed this uphill battle. “We got more blighted housing,” he wrote, “more poverty concentrated in our oldest neighborhoods, more flight of white people and their money to the suburbs where property values rose for those folks, more fires uprooting the poorest of the poor, more homelessness.”