Urban renewal and community development in the United States can a driver of economic growth, innovation, and cultural vibrancy. Yet, the very projects that promise renewal—new transit corridors, sparkling residential towers, dynamic mixed-use spaces—often trigger another familiar story: the displacement and marginalization of low-income communities, especially Black and Latinx residents. This narrative has played out across the country, as recently demonstrated by the Atlanta Beltline project.
In "Red Hot City: Housing, Race, and Exclusion in Twenty-First-Century Atlanta," Dan Immergluck examines how Atlanta captured the attention of developers, municipal leaders, and new residents seeking opportunity in a rapidly evolving urban landscape with the promise of the Atlanta Beltline. The Beltline, once praised as an inclusive, visionary plan to use art to connect neighborhoods with parks, trails, and transit, became instead a catalyst for upscale development and rising property values. (See Appendix A.)
The heartbreakingly predictable outcome has been the displacement of long-time residents who can no longer afford to stay. Often, these are households of color and families with limited incomes.
Such patterns of urban renewal have tangible human costs. High rent burdens, forced relocations to far-flung suburbs lacking vital services, and the erosion of historical communities are only part of the damage. The larger tragedy is a systemic failure to ensure equitable access to housing and the wealth-building potential it represents.
Who always wins is the owners/investors who have the capital to be proactive and gather and hold land that will someday be worth more. Who always loses is the renters who are forced to move as property values rise. We can and must do better.
The repeated patterns of displacement in thriving cities result from the highly complex nature of the relationships between stakeholders and of funding large projects. Despite an expanding consensus on what is needed—more affordable housing, greater community control over land, stronger anti-displacement protections—policymakers and market actors alike have struggled to address these needs effectively.
This article paper aims to lay out an equitable community development and housing solution that cuts across the complexity to align residents in the communities with the monied interests. Drawing on lessons learned from Atlanta, Louisville, and other urban contexts, this paper proposes a forward-thinking public-private-people partnership (4P) to shift the balance of power, protect residents from the worst excesses of market-driven displacement, and provide a path for truly inclusive development.
Unpacking The Problem
In many cities, decades of discriminatory policies, systemic disinvestment, and unchecked development have widened racial and economic disparities, disproportionately harming low-income communities of color. While revitalization efforts have fueled economic expansion, they have also driven up housing costs, deepened segregation, and accelerated displacement. Homeownership remains out of reach for many Black and Latinx families, mortgage lending disparities persist, and eviction rates remain highest in historically redlined neighborhoods.
Meanwhile, private-sector interests and policy loopholes continue to favor luxury development over genuinely affordable housing, exacerbating the affordability crisis. Without intentional change, these patterns will continue to marginalize vulnerable communities, reinforcing the cycle of housing instability and economic exclusion.
Inequitable Growth and Displacement. Revitalization efforts often benefit wealthier, predominantly white residents while displacing low-income communities of color.
Ownership and Wealth Disparities
Homeownership rates: 70% for white residents; 38% Black; 39% Latinx; 54% Asian.
30% of Black households earn less than $25,000.
Mortgage denials: 28.1% Black, 23.6% Latinx, 16.1% white.
Key Indicators of Displacement and Gentrification
Eviction Rates: Higher in West Louisville, where 75% of residents are Black and 80% rent.
Rising Housing Costs: Median rent up 9.7% since 2016; median home price up 16.6%.
Demographic Shifts: Minority population at 34% (22% Black). Areas with >25% poverty also have high unemployment, low educational attainment, and declining incomes for 30% AMI households.
Opportunity Gap: West Louisville faces higher poverty, vacancy, and housing cost burden; East Louisville sees high opportunity and wealth.
Housing Affordability and Cost Burden
Cost Burden: >25% of households pay >30% of income on housing. Rates are highest for 30% AMI households; 50% AMI cost-burdened households rose 33.4% since 2016.
Severe Cost Burden: >11% pay over 50% of income on housing; nearly 60% of 30% AMI households are severely cost burdened.
Housing Availability and Supply
Affordable Housing Gap: Needs for 30% and 50% AMI households grew 9% and 16% respectively since 2016. Unmet need now at 36,160 units (2024), enough for only 55% of households below 30% AMI.
New Construction: Despite added units, demand outpaces supply, especially for lowest-income residents.
Policy and Private Sector Influence
Developer Interests Over Community Needs: Profit-driven speculative investments drive up rents, reduce ownership opportunities, and destabilize housing.
Tax Incentives and Underassessment: Luxury developments receive tax breaks without strict affordability requirements, and commercial underassessment reduces revenue for housing.
Political Clout: Public meetings can be dominated by special interests, leaving marginalized communities with little leverage.
Addressing Affordable Housing
For decades, countless cities across the United States have grappled with a worsening affordable housing crisis. Rents continue to rise, forcing many lower-income households—particularly Black and Latinx communities—to devote large portions of their paychecks to housing alone. As property values spike, long-time residents in gentrifying areas often face higher taxes or rents they simply can’t afford, resulting in uprooted families and fractured neighborhoods.
Experts, policymakers, and community advocates broadly agree on strategies to address housing inequities:
Inclusive Planning and Development Actively involve marginalized communities in urban development decisions through resident-led planning, participatory budgeting, and ongoing community feedback loops.
Investment in Affordable Housing Expand and preserve affordable units to prevent low-income displacement and improve access to transportation, healthcare, and education.
Strong Protection Policies safeguard vulnerable populations from displacement and strengthen housing stability.
However, the Atlanta Beltline example shows how economic development entities often prioritize developer interests. Many agencies are no longer active 10–20 years later to uphold original commitments, underscoring a lack of long-term accountability and consistent enforcement of community benefit agreements.
Communities don't want community benefits that no one can enforce, particularly 5-10 years later when larger developments begin to happen. They want ownership - so they are on the cap table when it does happen.
Over the years, numerous strategies have been implemented across the country to combat the affordable housing crisis, ranging from inclusionary zoning laws to community land trusts. See this article for a detailed list of the breadth of existing efforts.
While these measures reflect genuine progress and show a collective desire to tackle inequities, they often lack the structural depth and long-term accountability needed to protect low-income residents from displacement.
Complexity of the Stakeholder and Funding Landscape
Despite consensus on these needs, tangible progress often remains elusive. Why? Because the political will, funding streams, and alignment of stakeholders are fragmented.
Because there is incredible complexity with many different stakeholder interests and moving pieces
Because the funds are concentrated to one section of the diagram, namely with developers and their investors, and they get special treatment from the government section in the name of getting things built
This is really hard, but it has to be done. Project after project has good leadership, relationships and ideas, but does not ultimately happen. It’s due to all the things that are needed to secure capital. Bringing people together around bold initiatives and working to attract funders – investors, bankers, local, state and federal government grants and development initiatives – and staying with it, getting projects done. All that is needed for change.
We Can Do Better: The Public-Private-People Partnership (4P)
Given the complexity and constraints of today’s urban development and affordable housing market, we can’t simply redefine the environment in which we operate. Instead, we must harness the same tools, partnerships, and financial structures that shape development across the board—while reorienting them toward more equitable outcomes.
The process starts with community-led economic development, a unique planning process detailed here where developers partner with community residents to lead in their neighborhood transformation. Far more than community engagement, this is a more fundamental learning, sharing and healing justice process that transforms all parties involved to create and undergird new collaborations to drive neighborhood transformation.
The next steps in the solution cut across all of the urban renewal realities identified herein to ensure that communities share in the benefits of growth directly, rather than being left on the margins.
Shared growth is where the benefits and burdens of growth are shared equitably be all --- across race, eithnicity, income, geography, educational attainment, ownership, access to capital, etc.
A. The Core Concept: 4P
Our Public-Private-People Partnership (4P) approach integrates residents in communities into the ownership and decision-making structures of urban development. This is a fundamental shift from conventional Public-Private Partnerships (PPP). By formalizing residents’ ownership stake, our 4P model redistributes power to ensure that growth also benefits those most at risk of displacement.
B. Community Ownership and Land Acquisition Vehicles
Flexible Ownership Vehicle for Community
A community-focused economic development co-op can hold ownership stakes in various ventures, from housing developments to local businesses. By entering into a fiscal sponsorship arrangement with an established nonprofit, the co-op can accept grant funding, donated land, and other forms of capital. This structure aligns financial incentives with community well-being.
Fiscal Sponsorship by a Nonprofit
An existing nonprofit can serve as the fiscal sponsor, providing administrative infrastructure and a track record of credibility. This nonprofit also receives programming funds to assist the co-op with outreach, education, policy, and advocacy. It thereby becomes the accountability mechanism long missing in many large-scale developments.
The Land Acquisition Vehicle (LAV)
A for-profit entity with a 10–20-year investment horizon, professionally managed, that co-invests alongside the co-op. Ownership in the LAV is pro-rata based on the capital contributed. However, the co-op receives a “promote”—a larger share of returns—for undertaking the crucial work of organizing, education, and driving the idea. This structure encourages both private investors and community members to collaborate rather than compete.
C. Alignment of Interests and Long-Term Accountability
Conventional developments fail in large part because once the capital is invested and the units are built, the community is left without recourse if promised benefits do not materialize. In this new model, community stakeholders and nonprofits remain “on the cap table,” ensuring they have legal and financial claims to the proceeds of future developments. This not only incentivizes collaborative planning up front but also maintains accountability over the long haul.
I prefer to get away from community benefit agreements and simply have ownership as a way to be sure residents get a fair share of the growth.
D. Funding Sources for a 4P
Securing and managing capital is the linchpin of any urban development/affordable housing initiative. Due to the structure of the LAV, multiple funding streams can be braided together to create a robust capital stack and business model.
Dedicated Public Revenue Streams
Tax Increment Financing (TIFs): Redirects a portion of future tax revenue increases toward affordable housing.
Housing Trust Funds: Local or state-level trust funds can provide grants or low-interest loans to seed projects. (e.g., LAHTF)
Inclusionary Zoning Fees
Fees paid by developers in lieu of building affordable units on-site can capitalize the LAV.. These fees typically go unused or underutilized; channeling them to a well-organized co-op vehicle can generate immediate impact.
Public Land Contributions
Municipalities can transfer or lease publicly owned land to nonprofits or the co-op at below-market rates, with provisions ensuring long-term affordability.
Tax Incentives and Credits
Low-Income Housing Tax Credits (LIHTCs) can offset development costs, making projects more financially viable.
Property Tax Abatements for developers who dedicate a percentage of units as permanently affordable.
Nonprofit and Community Funding Models
Public grants, private donations, and low-interest loans aimed at acquiring land or rehabilitating properties for permanent affordability.
Community Development Financial Institutions (CDFIs) can offer more flexible terms than traditional banks.
Social Impact Bonds
Private investors provide upfront capital and are repaid by public agencies only if specified social outcomes (e.g., reduced homelessness) are met.
Regional and State-Level Allocations
State Housing Funds and bond measures can inject significant capital if local political will aligns.
Regional Collaboration across municipalities can address housing challenges holistically, pooling resources to achieve greater scale.
Tenant Assistance Programs
Rental Assistance Vouchers (e.g., Section 8) or locally funded programs ensure low-income tenants can afford rising rents.
Emergency Rental Assistance acts as a safety net during personal or economic crises, preventing unnecessary evictions.
Assets, Relationships, and Skills
The 4P model is not merely theoretical. Across the country, smaller-scale examples demonstrate that when communities have a direct ownership stake, displacement pressures diminish, and people are empowered to shape their neighborhoods’ futures.
What is needed now is the boldness to replicate and and even scale up these experiments, align new and existing funding streams, and institutionalize the approach. We will continue to share our efforts and seek feedback and partnerships.
It is our understanding of this landscape plus what we are bringing to the table that will allow us to cut across the landscape and produce different outcomes.
Appendix A: Lessons from the Atlanta Beltline: Summarizing the Atlanta Beltline Policy Shortfalls
While Atlanta’s Beltline project was initially lauded for its ambitious vision, it quickly fell short on affordable housing. Key mistakes included:
Over-Delivery of Tax Credits to Developers | The excitement around the Beltline attracted both local and national developers, who received substantial tax incentives for high-end construction. These incentives proved unnecessary, as market demand alone would have spurred investment. |
Public-Private Partnerships Without Community Stake | By relying heavily on private-sector financing, the Beltline project prioritized economic growth and commercial profitability over community needs. No enforceable mechanisms existed to ensure affordable units were built. |
Weak Affordable Housing Requirements | Though there was an initial promise to secure affordable units, the Beltline project lacked binding commitments or robust oversight. As a result, rising property values displaced lower-income renters with minimal recourse. |
Failure to Secure Affordable Housing Early | Development soared ahead of mechanisms to protect or create affordable units. By the time policymakers recognized the extent of gentrification, property values were too high to feasibly intervene without enormous public subsidy. |
Demolition of Public Housing | Under the guise of creating mixed-income communities, much of Atlanta’s public housing stock was demolished. The net effect was reduced housing options for the city’s poorest residents, exacerbating displacement. |
Ineffective Response to Foreclosure Crisis | In the wake of the 2007–2012 crisis, Atlanta did little to assist homeowners in distress or acquire foreclosed properties for affordable housing. Private investors capitalized on these acquisitions, turning formerly affordable ownership into market-rate rentals. |
Limited Access to Housing Assistance | While rent soared in Beltline-adjacent neighborhoods, existing housing assistance programs were insufficient to shield low-income renters. This gap widened displacement’s reach. |
How the Proposed Model Addresses These Failures
Ownership Stake for Communities: By positioning the nonprofit and the co-op as co-owners, large-scale gentrification cannot proceed unchecked.
Early Acquisition and Land Banking: The LAV can secure land at lower prices before displacement accelerates.
Nonprofit Oversight: A dedicated nonprofit ensures that agreements to maintain affordability are tracked and enforced over decades, rather than lapsing once the project is built.
Mixed-Income Requirements: New mixed-use housing projects supported by the LAV would be mandated to include below-50% AMI units, preventing the steep imbalance observed in the Beltline’s luxury boom.
References:
Comments