Denver was the second-most “intensely gentrifying” city during the middle of the last decade, with 22 neighborhoods in the city and its adjacent suburbs undergoing transformation, a new analysis indicates.
“In our prior study of gentrification between 2000 and 2012, we found that gentrification was relatively rare in metropolitan areas in the U.S.,” the report, titled “Gentrification and Disinvestment 2020,” found. “However, during the past five years more cities experienced at least some level of neighborhood gentrification than in the prior period.”
The findings come from the Washington, D.C.-based National Community Reinvestment Coalition, whose members include community investment and development organizations, faith-based institutions and civil rights groups.
Gentrification is the process by which an area perceived as blighted or undesirable is transformed into an attractive location for middle-class or affluent residents. Generally the change involves an influx of young, white people into communities of color whose families may have longstanding ties to the area being transformed.
“When I began at Urban Land Conservancy in 2007, our most urgent need was to neutralize future displacement by purchasing properties along transit corridors in at-risk neighborhoods,” said Aaron Miripol, the president and CEO of the Denver-based nonprofit that acquires and preserves affordable housing. “The Great Recession that occurred in 2008-2009 was like kerosene on the fire for many of Denver’s already vulnerable neighborhoods with rampant foreclosures leaving communities open to an ‘investment grab’ — the precursor to our receiving the No. 2 status in the report.”
The analysis covered the period from 2013-2017. During that time, Denver ranked second to San Francisco — although the areas deemed rapidly gentrifying were primarily in East and South Bay cities, rather than San Francisco itself. In Denver, the tracts identified as gentrified largely fall in the northeast and western parts of the city.
NCRC’s examination looked closely at opportunity zones, a concept introduced in the 2017 Tax Cuts and Jobs Act that principally lowered tax rates and added approximately $2 trillion to the national debt. Opportunity zones are census tracts that trigger tax incentives for investments in businesses therein. In the Denver area, several of the opportunity zones were in Sheridan, Commerce City and Aurora.
NCRC found that while there was overlap between opportunity zones and gentrifying neighborhoods, key characteristics differed between the two.
“Rents rose fastest in gentrifying and middle- to upper-income urban neighborhoods, creating housing affordability pressures. This contrasted with the OZs, which on average had lower population, higher percentages of black residents, lower median home value, lower median household income, lower rates of owner occupancy, low college education levels and greater economic inequality,” the coalition found. “They also had the lowest median rent and high levels of business and residential vacancy.”
While the Internal Revenue Service curates a list of opportunity zones, NCRC defined gentrifying neighborhoods as those meeting threshold increases in median home value, median household income and educational attainment.
More than two-thirds of the 940 metro areas evaluated had no gentrification between 2012 and 2017. However, compared to the 12-year period prior to 2012, the following five years saw more cities undergo gentrification in at least one neighborhood.