Housing Development and Community Destabilization in Pilsen. How development agendas destroy housing options and dismantle the fabric of the neighborhood

The neighborhood of Pilsen was on the front lines of the real estate boom of the early 2000s. New condominiums were constructed, warehouses were converted into lofts, and local residents led protests at City Hall  and held community meetings opposing speculative real estate development. Many individuals and organizations such as the Pilsen Alliance  and its “Pilsen’s not for sale” campaign argued that the property tax and rent increases accompanying the construction of new condominiums would price them out of their neighborhood and their homes. They believed that the new housing would destabilize the neighborhood, simultaneously causing the displacement of long-term residents and families who had lived in the area for three or four generations and attracting a new population that would live in Pilsen for just a few years—with little use for Pilsen’s schools, library and other community institutions—before moving on to the next “up-and-coming” neighborhood. Architectural preservationists grimaced as site-maximizing brick and cinder block 3- and 4-unit buildings with designer cherry wood kitchen cabinets began to erase Pilsen’s distinctive blend of Eastern European and Central American influences.1

In April 2005, the Chicago Tribune  plunged into this debate, declaring in an editorial that Pilsen’s housing stock, some of the oldest in the city, was “so exhausted [that buildings] seem to lean on each other for support.” Rather than celebrate the longevity of this neighborhood, its intricate and often striking architecture, and property that included some pre-Fire housing, the Tribune  told its readers that a proposed condominium development called Chantico Lofts  would “bring a badly needed economic stimulus to Pilsen.” Concluding that “development is not a threat to Pilsen,” the Tribune  called it “a lever to improve the lives of its residents and stabilize the community.”2  The condescending tone of the editorial—telling Pilsen’s inhabitants that their lives needed improvement—angered residents who felt that they had struggled to build a neighborhood from which they would now be displaced.

Far from “stabiliz[ing] the community,” we contend, the new condominium developments in Pilsen in the mid-2000s had the opposite effect, tearing holes in the heart of this densely populated neighborhood that, at the time of writing, remain unfilled. In addition, the now notorious real estate lending practices that targeted low income neighborhoods such as Pilsen have led to growing rates of foreclosure. Of all Chicago’s majority Latino neighborhoods, “only Pilsen saw increased property values in the period 2003–09” and, during this period, it had the lowest rate of foreclosure amongst its peer neighborhoods, such as Little Village  and Logan Square , being at or below Cook County  averages.3  Using data provided by DePaul’s Institute for Housing Studies , Mike Jersha , a Geography undergraduate, mapped the rates of home sales and foreclosures by census tract.

Despite the Tribune’s  assertion, early analyses of the condominium boom of the late 90s and early 00s demonstrated how Chicago’s communities were being transformed. A Loyola University  survey found that in Chicago, “Changes in housing most visibly mark the onset of gentrification, and can therefore become a highly contentious issue. When asked what changes respondents notice in their communities, the most frequent answer is, ‘housing.’” Respondents also suggested that condominium owners were a more transient and less engaged population than long-term renters and homeowners. New residents were less likely to have children, a factor which affects schools, and less likely to be elderly. Consequently, as condominium development and gentrification reinforce each other, the ages of community residents narrow and the variety of a neighborhood’s housing type similarly contracts, with higher-cost condominiums, largely interchangeable in terms of their size and utility, replacing a range of public and private housing options.4

Pilsen was gentrifying rapidly when the Tribune editorial was published. New condominiums were popping up not just at major intersections (such as Pilsen Gateway  at 16th and Halsted ) or by way of the conversion of old industrial buildings (Chantico Lofts at 16th and Carpenter ), but also midway along blocks, towering above adjacent single family homes, disrupting the often eclectic streetfacing facades with their jarring presence. The most egregious example of the destabilizing impact of speculative condominium development in Pilsen was the failed Centro18 project  at 18th and Peoria .5  A fruit wholesaler and the single family homes there were demolished in 2006 to make way for 400 new condo units that were never built, following the bankruptcy of the lead developers. Today, a two-block expanse of concrete and gravel remains. Perhaps more indicative are the numerous individual sites and units that we have been collecting data on for ten years as part of a collaboration between DePaul University’s Department of Geography, Steans Center for Community-based Service Learning , and the Pilsen Alliance called, “Contested Chicago: Pilsen and Gentrification.”6

Speculation in the housing market has led to three types of condominium construction currently haunting Pilsen.

Type 1: The vacant lot. For about 120 years, a two-story, two-unit house, originally built in 1889, stood at 1913 S. May . By the early 2000s, this property sat amidst other similar houses on a block zoned RT-4, a designation that allows multi-unit residences up to 38 feet high. On August 31, 2004, 1913 S. May sold for $175,000. Less than a year later, the sale price increased to $220,000 on February 17, 2005 and on August 23, 2006 the same house sold for $240,000 (a 37% increase in property value in two years). Sometime between then and now, the house was demolished. During this period, on January 9, 2008, the City granted the owner a zoning change, increasing the zoning from RT-4 to RM-4.5. Of the 61 properties on S. May Street between 18th Street and Dvorak Park  (at Cullerton), 1913 is the only currently vacant site. It is also the only one zoned RM-4.5. All the other buildings, save three zoned for business/commercial uses, are RT-4, the most common residential zoning in this area. The higher RM-4.5 zoning allows a larger property to be built, most likely containing additional condominium units. But nothing had happened on this site for about three years until on November 11, 2011, when the lot was sold for $25,000. The site remains vacant and the building that once stood at 1913 S. May, a house where families lived, is gone.

Type 2: Unfinished condominiums.The design for 1520 W. 18th Street  was proudly displayed on a billboard on the site. Promising stainless steel appliances and mosaic tile backsplash to accompany the granite countertops and oak hardwood floors, Third Dimension Design, extolled the track lighting, private decks, stone tiled bathrooms and breakfast bar. The floor plans and architecture of the soon-to-be-available condominium indicated a four-story building with a commercial first floor space, two duplex units and a penthouse. The site’s history is like that of 1913 S. May. Public records show a two-story, three-unit residential property built in 1879 that saw a rapid appreciation in value as speculation increased, prior to demolition, a proposed new condominium development and then vacancy. 1520 W. 18th Street was sold on March 26, 2001 for a mere $29,500. A year later, on March 27, 2002, the sale priced leapt to $120,000, and then on to $165,000 by December 7, 2004 (a 460% jump in three years). The 1879 housing was demolished around this time, and concrete foundations poured. Then nothing: The foundations, with their steel cables sticking up out of half-built walls, became an open sewer as water and trash accumulated. At the time of writing, a “motivated seller” is listing the vacant lot at $149,900 as an “excellent development opportunity.”7

Type 3: The unoccupied units. 953 W. 18th Street  is a three-unit condominium, with a ground floor retail space, completed in 2006. Before its demolition in the early 2000s, a small single-family home dating from 1879 sat on the site. The new ground-floor commercial unit has never been occupied, and the upper floors seem to have been similarly vacant. The facade and front windows of the first floor have been tagged by graffiti, and signs indicating the property is for sale have been posted on the building continuously since 2007 by a series of companies, including MLS Realty, Buy Owner and Pilsen Realty. One of the units was listed for sale at $304,900 in 2009. As we write, Trulia.com  lists a unit in the building for sale at $239,900, a price reduction of over 20%.8  The much hyped and promoted “condoization” of Pilsen in the first few years of the 21st century has had a destabilizing effect. Pools of water and trash sit in the poured concrete foundations of unbuilt houses; newly constructed condominium units sit empty, never having had a resident; homes have been demolished, leaving weed-strewn vacant lots; half-built condominiums sit with “Stop Work” orders pasted to their facades. Once the housing market rebounds, and signs suggest this is beginning, Pilsen will again face speculative real estate pressures and sites like those described may soon become the condominiums developers began almost a decade ago. However, perhaps the most ironic aspect of this story is that in 2006, precisely the time that Pilsen saw such speculative and destructive housing development, the neighborhood was added to the National Register of Historic Places  as the Pilsen Historic District . 1913 S. May and 953 W. 18th Street were both listed in the Historic District application as houses that “contributed” to the historic streetscape. It is a curious Historic District that allows such buildings to be demolished and replaced by vacant lots and unoccupied condos. ◊

 

1. Preservation Chicago, Chicago’s Seven Most Threatened Buildings – 2006, Preservation Chicago, Chicago, 2005 [available at: http://www. preservationchicago.org/chicago-seven/2006]

2. “Mi Barrio No Es Su Barrio,” Chicago Tribune, 25 April 2005, p.20.

3. Martha Martinez, The Housing Crisis and Latino Home Ownership in Chicago: Mortgage Applications, Foreclosures, and Property Values, University of Notre Dame, Institute for Latino Studies, 2009.

4. Philip Nyden, Emily Edlynn and Julie Davis, The Differential Impact of Gentrification on Communities in Chicago, Center for Urban Research and Learning, Loyola University, 2006.

5. Euan Hague, “18th and Peoria,” AREA Chicago, 11, 2012.

6. Paul Lloyd Sargent, “Contested Chicago: Pilsen and Gentrification,” AREA Chicago, 3, 2006.

7. Listing for 953 W. 18th Street, Unit B. http:// www.trulia.com/property/3095114572-953-W- 18th-St-B-Chicago-IL-60608

8. Listing for 1520 W. 18th Street. http://www. zillow.com/homedetails/1520-W-18th-St-Chicago- IL-60608/2117575594_zpid/