A Questionable Robin Hood Story: Branded Housing Projects and Public-led Commodification of Urban Space

A Questionable Robin Hood Story:
Branded Housing Projects and Public-led Commodification of Urban Space

Abstract

Inequalities in urban space have been on the rise since the 1970s with global neoliberal restructuring processes. This rise in inequality fosters segregation in urban space which has become observable through gated enclaves. Housing enclaves became a way of urban space production in many countries. Aligning with this global trend, since the early 2000s, following the 2001 economic crisis, a new version of housing enclaves has been emerging in Turkey- branded housing projects. The projects are produced under certain brands as urban spatial commodities by private developers or public private partnerships, and widely use various types of advertising like any other commodity on the market. The role of state institutions in the production of this commodified and marketed form of housing provision is illustrative of the practices of the neoliberal state. This article[1]  discusses branded housing projects in relation to the role of the developing neoliberal state in Turkey, firstly by giving an overview of the neoliberal urbanisation processes which Turkey has been going through; secondly by discussing the main characteristics of the projects; and thirdly by focusing on the role of public institutions in the production of such places, and criticizing the role of revenue-sharing model. The article thus questions the role of the neoliberal state in contemporary commodification of urban space in Turkey.

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Introduction

Inequalities in urban space have been on the rise with global neoliberal restructuring processes since the 1970s. This rise in inequality in urban space is manifesting itself in the increase in segregation in urban space, which has become observable through housing enclaves. These have become a way of urban space production in many countries, with different versions and with different conceptualisations such as ‘gated communities’ in US (Blakely and Snyder, 1997), ‘condomínios exclusivos’ in Brazil (Carvalho, George & Anthony 1997), ‘garden-towers’ in Argentina (Borsdorf and Hidalgo 2010),  ‘residential parks’ in Hungary (Bodnar and Molnar 2010) or condominium developments in Singapore (Pow 2009).

Aligning with this global trend, a new version of housing enclaves has been emerging in Turkey since the early 2000s, following the neoliberal restructuring processes. These housing enclaves are called branded housing projects. The branded housing concept has been developed by its usage in media and project advertisements, and it has become a part of daily language. The projects are produced under certain ‘brands’ as urban spatial commodities by developers, and widely use various types of advertising like any other commodity in the market, including TV commercials, print media and outdoor advertisements, as well as internet advertising.

This article discusses branded housing projects in relation to the role of the developing neoliberal state in Turkey, while focusing on the role of public institutions in the production of branded housing project as a phenomenon in Turkey through discussing the practices of TOKI (Mass Housing Institution in Turkey), Emlak Konut GYO (The Real Estate Partnership), and Kiptaş (Development Company of Istanbul Greater Municipality).

Firstly, the neoliberal urbanisation processes which Turkey has been going through are briefly discussed. Secondly, the main characteristics of the branded housing projects including physical-spatial features, and services and facilities provided in the confines of the projects are presented. Thirdly, the main actors and public-private partners of the projects are focused on and the roles of state institutions in production of such projects are investigated through discussing the practices of the three aforementioned institutions and the revenue-sharing model is criticized. As a result, the role of the neoliberal state in contemporary commodification of urban space in Turkey is questioned.

Neoliberal Restructuring and Urban Development

Neoliberal restructuring processes have been taking place since the early 1970s as a global phenomenon (Harvey 2007; Peck, Theodore & Brenner 2009; Brenner and Theodore 2002). During the late 1970s, neoliberalism gained importance as a ‘strategic political response to the declining profitability of mass production industries and the crises of Keynesian-welfarism’ (Peck, Theodore & Brenner 2009, p. 50). Through neoliberalization, states started to dismantle post-war institutional structures and implement policies of marketization, commodification and fostering competition (Peck, Theodore & Brenner 2009, p. 50). Through global transformations in the world capitalist system, ‘[b]y the mid-1980s, in the wake of this uneven but concerted realignment of policy agendas throughout the world, neoliberalism had become the dominant political and ideological form of capitalist globalization’ (Peck, Theodore & Brenner 2009, p. 50).

As part of these restructuring processes, neoliberal urbanisation has been observable through the practice of production of space. Peck, Theodore and Brenner (2013, p. 1093) argue that cities are not passive recipients of neoliberalization processes, but the neoliberalization processes are continuously and actively constituted through global urbanizing regions. In this respect, ‘cities have become critical nodes, and points of tension (resistance, conflict, even riots, etc), in the evolving scalar politics of neoliberalization’ (Peck, Theodore & Brenner 2009, p. 49). Therefore, since the 1990s, urban areas have become critical places to understand dynamics such as limits, contradictions or changes of neoliberalism (Peck, Theodore & Brenner 2009, p. 49).

Neoliberal Urbanisation and the Rise of Branded Housing in Turkey

Turkey has been going through neoliberal restructuring and neoliberal urbanisation practices starting from the 1980s and deepening after the 2001 ‘major accumulation crisis’ (Kuyucu and Ünsal 2010, p. 1484). Through this restructuring, cities in Turkey have been facing a construction boom, which Balaban (2012) defines as the increase in the volume of construction activity in Turkey in terms of increase of the construction sector’s share in GDP, rising share of the construction sector in employment, and financial and capital investments in construction, by showing the unprecedented rises in these three areas between the year 2001-07. In addition, according to the Statistics Institute of Turkey (TUIK) Building Permits Report (2013), the total area of buildings which were given building permits in the year 2012 was five time higher than in 2002, which demonstrates the dramatic increase in construction in Turkey in this period.

In this period, the phenomenon of branded housing projects (markalı konut projeleri in Turkish) has developed. In daily language and media coverage, the term branded housing projects is used to define housing enclaves which provide various amenities (e.g. social facilities, open green spaces, sport facilities) within the confines of the projects exclusively for the project residents. The projects have been produced under particular brands as commodities for the market by private developers or public-private partnerships.

Land Use Pattern of the Branded Housing Projects

The branded housing projects present a similar land use pattern. The branded housing projects provide both open space facilities and indoor facilities. While open space facilities are parks, playgrounds, recreation areas; indoor facilities are restaurants, cafes, social rooms, and health and education facilities. Sport facilities (in the form of sport centres or sport areas) and carparks are provided as both indoor and open space facilities in the project areas.

Buying or renting a house in the project grants residents the access rights to these facilities and services. The residents are responsible for paying monthly payments to private management companies of the projects in return for receiving services and for management of the facilities. To illustrate, projects provide residents playgrounds and parks only accessible to their project residents, and are in charge of the management of these (garbage collection, landscaping, manicuring of green areas, etc). In other words, projects perform the municipal services privately. Therefore, within this practice, the access rights to services and facilities are being commodified by making residents pay for these urban services.

However, there are also some exceptions. Although the services and facilities in the projects are in general for exclusive use of the project residents, there are also some publicly accessible facilities (e.g. supermarkets with separate entrances) and limited access facilities (e.g. sport centres of which membership is not bound with being a resident of the project) in these project areas. For these limited access facilities, residents usually receive discounts in membership fees.  In some cases, access rights to facilities can be bought by non-residents as well. To illustrate, in some cases non-residents of a project can buy a membership for a sports centre which is located in that project area. Despite these differences, branded housing projects present a practice of private provision of municipal services by private management companies.

Spatial Features of the Branded Housing Projects

The projects present similar spatial patterns in terms of their design schemes and spatial segregation from the surrounding environment. Firstly, many branded housing projects have been designed as introverted cluster-like spatial formations. The buildings are located on the perimeters of the project area, which forms a spatial boundary. Within the project area, the facilities which provide services exclusively for the residents are located inside this spatially segregated district (Lynch 1960). To illustrate, Figure 1 shows typical examples of introverted design and segregation pattern of the projects.

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Figure 1 Spatial formation of branded housing projects (*Source: Personal Archive ©)

Secondly, in addition to this design approach, the project areas are also physically segregated by being gated and walled. The boundary elements vary from concrete walls to razor wires. Figure 2 shows examples of physical segregation elements – gates and walls. Figure 2 also shows an example of use of gates in branded housing projects. The name of the brand is usually written on the top of the gates. By attaching the name of the brands onto the gates of the projects, the gates also produce a representational boundary in addition to their function of controlling access.

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Figure 2 Boundary elements of branded housing projects (*Source: Personal Archive ©)

This spatial segregation enables packaging of the urban space within tangible borders as an urban spatial commodity which can be bought and sold easily. In other words, this spatial pattern fosters commodification through segregating a slice of urban tissue spatially.

The Role of the Public Sector in the Development of Branded Housing Projects

Branded housing projects are developed as a socio-spatial phenomenon in the post-2001 period. The role of the public sector in the development of this phenomenon is critical considering the public actors in many branded housing projects such as TOKI, Emlak Konut GYO and Kiptas.

In the post-2001 period, the legal and regulatory framework in Turkey has been thoroughly transformed. Post-2001 reforms in the legal and regulatory framework align with the post-Washington consensus (Özdemir 2012, p. 44), which aims to produce institutions to support the market economy.

In this period, via this legal and regulatory framework transformation, expansion of construction has been supported and encouraged (Balaban 2013, p. 63). Balaban (2012, p. 26) emphasizes the role of the public sector in the recent construction boom in Turkey, of which the expansion of branded housing projects is a part. The public sector ‘enthusiastically contributed to the development of construction boom between 2002 and 2007 in Turkey’ (Balaban 2012, p. 26) and ‘government undertook significant steps to encourage public agencies and private developers to initiate large-scale urban (re) development projects’ (Balaban 2012, p. 26). As Kuyucu and Unsal (2010) argue, new actors and partnerships are being founded such as public development institutions, which are restructured and became actors in this process, and project-based public private partnerships.

In this respect, the public sector’s direct involvement in the construction sector via public developers such as TOKI, Emlak Konut GYO and public companies such as Kiptas-Istanbul Greater Municipality, and the foundation of such actors, are critical turning points to understand the recent urbanisation patterns, construction boom and new spatial formations like branded housing in Turkey.

TOKI-Housing Administration of Turkey

Housing Administration of Turkey (TOKI) has been restructured and empowered, and has become the most important public development company for profit-oriented housing projects. The institution, which was initially responsible for credit provision for housing production, was founded in 1984 (Bugra and Savaskan 2014, p. 85).

Considering TOKI’s role in housing production in Turkey, the foundation of TOKI was a milestone for development of urban land and housing. Through TOKI, the state participated in housing production directly as an actor through mass housing production and by providing funding for housing cooperatives. Between 1984 and 2002, TOKI provided credits for 940000 houses, and between 1984-2003, the institution constructed 43,145 houses (Perouse 2013, p. 83).

In the post-2001 period, TOKI became a direct actor in construction sector rather than being mainly a funding body for housing projects and developers (Balaban 2013, p. 64). The institution has been taken under the command of the Prime Minister’s Office (Bugra and Savaskan 2014, p. 93) and restructured according to its new role. It has become a public developer with an authority that goes beyond housing production – e.g. the institution has the authority produce urban plans, develop other uses including commercial, etc. While public assets from abolished public institutions (such as the Urban Land Office) have been transferred to TOKI, TOKI has been equipped with a wider authority which lets it develop branded housing projects on these public lands.

By March 2016, TOKI has 43 active revenue-sharing projects including branded housing projects like Spradon, Divan Residence, and Olimpiakent (TOKI 2016).

Emlak Konut GYO

Emlak Konut  is the second institution which was restructured thoroughly and became one of the biggest real estate developers in Turkey. Emlak Kredi Bankasi (meaning Real Estate Credit Bank) was a housing-specialized bank (in Turkish konut ihtisas bakasi) aiming to support homeownership (Adam et al. 1981, p. 266). In 2001, Emlak Bank underwent transformation. Its banking responsibilities and holding savings were terminated (Perouse 2013, p. 83), and the banking activities of the institution were transferred to two public banks (to Ziraat Bankası and Halkbank), while its assets and real estate were transferred to TOKI (TOKI 2015).

Emlak Konut GYO became a TOKI enterprise as a result of this restructuring. While 49.34% of the total shares of the company belong to TOKI, 50.66% of the shares are open to the public (Emlak Konut GYO 2015a). By 2011, Emlak Konut GYO had become one of the biggest real estate investment partnerships in Turkey with its $2,250 billion value (Perouse 2013, p. 92). The total value of the tenders since 2003 reached $17.78 billion (Emlak Konut GYO 2015c), and Emlak Konut’s share in total revenue generated from revenue sharing projects reached $4.6 billion by September 2015 (Emlak Konut GYO 2015b).

By 2014 Emlak Konut GYO had developed 43 branded housing projects in Istanbul alone. In these projects the same revenue-sharing model has been applied. Figure 3 shows the distribution of these branded housing projects in Istanbul.

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Figure 3 Location of 43 branded housing projects Emlak Konut GYO developed between 2003-14 (While the dark red represents completed projects, the light red represents continuing projects)

Kiptaş-Istanbul Greater Municipality

Kiptas followed a similar path to TOKI and Emlak Konut GYO. It was founded as a foreign capital partnership in 1987 with Istanbul Greater Municipality; then in 1995 it was restructured as a public development company of the municipality. The institution started to operate as a public developer for housing projects with Basak-Hilal Mass Housing Project, in the northern part of Istanbul. So far, Kiptas has developed 56 housing projects, eight of which are continuing, and constructed 63,000 housing units Istanbul (Kiptas 2014). The total assets of Kiptas were worth $488 million by December 2014 (Kiptas 2014).

Kiptas has developed 12 branded housing projects so far. Some of these projects are very well-known and controversial, such as Viaport Venezia, which re-produces an artificial Venice in Istanbul. Kiptas is an example of a public developer which undertakes overtly profit-oriented housing projects by using municipally-owned land.

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Figure 4 Viaport Venezia (Kiptas 2015)

Revenue Sharing Model

These three public developers apply the same revenue-sharing development model. This partnership model is based on sharing profits of the profit-oriented housing projects, branded housing projects in this case, by private and public developers. While the public developer provides the land – public land – for the project, the private developer develops and realizes the projects. At the end, the units are sold, the partners share the profit.

Emlak Konut GYO defines this model as a way to ensure ‘high profitability and fund flows’ (Emlak Konut GYO 2015b). According to the institution, it is the ‘most important model in terms of generating income’ (Emlak Konut GYO 2015b). Figure 5 explains how the model works basically.

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Figure 5 Summary of revenue-sharing model (Emlak Konut GYO 2015c)

Conclusion: Critique of the Practice of the Revenue-sharing Model

Perouse (2013, p. 92) criticizes revenue-sharing model: through this model, TOKI transfers the lands with higher rents to the real estate investment partnerships of big holdings in Turkey. Via this practice, public land is transferred into private property; therefore, it enables a covert way of privatisation of public land. Turning public land into a market commodity (e.g. privately owned housing units) instead of using this land to deliver social services (e.g. urban parks, green open spaces) demonstrates a very clear example of a practice of the neoliberal state – “a state apparatus whose fundamental mission was to facilitate conditions for profitable capital accumulation” (Harvey 2007, p. 7). Via this explicitly profit-oriented practice, the public sector puts public assets (publicly-owned land) into the housing market and contributes to the construction boom in Turkey.

Considering the lack of public open green spaces in Istanbul, this is a very critical position. While the ratio of public green space (public parks and gardens) in Istanbul is only 1.5% of the land area, this ratio is 38.4% in London, 14.4% in Berlin, 46% in Sydney (BOP Consulting 2014).  In addition, since these projects are profit-oriented projects, they target the upper-middle income group. Therefore, in this practice, public developers serve that particular section of society, and transfer those public lands to these classes.

The discourse that the public institutions use to legitimise their role in development of branded housing project is acting as Robin Hood for the poor. The claim is that the money raised by application of such profit-oriented projects will be invested in social housing. Therefore, it is presented as a way of transferring money from the rich to invest for the poor (Kadak 2005).  Since there is a transparency issue within these institutions, it cannot be concluded that this claim is realised. One important point regarding this claim is that so-called social housing projects developed by TOKI are based on home ownership. These projects are relatively affordable housing projects where residents buy the housing units by paying back lower-interest housing credit which is arranged for them through a partnership between TOKI and a specific bank Therefore, they are not social housing projects, but relatively affordable housing projects. There are also criticisms regarding their affordability by the poorest groups in society as well. For example, according to Adanali, who is working on contemporary urbanisation in Turkey, only one fourth of the total housing stock TOKI produced is for lower income groups, and the income band that TOKI set as maximum to access this housing corresponds to 3 times higher than the minimum wage (Güner 2014).

In addition, the practice of branded housing projects, which are developed by adoption of the revenue-sharing model, produces disadvantages for the working classes and vulnerable groups of society through its consequences. First of all the practice of branded housing projects contributes to the commodification of urban space through transferring publicly owned land into private property, since these projects are built on public land. Secondly, as mentioned in the discussion, this practice produces private provision of urban infrastructure. Since the projects are run by private management companies, the practice contributes to transforming these services into market commodities. In other words, this practice produces segregated slices of urban tissue which are packaged and sold together with access rights to social facilities and services. In this practice, municipalities and state institutions directly promote private provision of urban services. Thirdly, this situation raises a question regarding the provision of urban infrastructure for the rest of society, especially for the vulnerable groups. If right to access to an urban park or a playground becomes a part of commodity package which limits the access of these services to buyers only, the result will not be in favour of the working classes and vulnerable groups of society.

As a result, this practice is neither as simple as claimed in the Robin Hood rhetoric nor charitable. The results do not follow a simple logic of profiting from the rich and investing for the poor. What is observed is more a rise of an urban Leviathan than an archer for urban justice.

Bilge Serin, PhD Candidate, Urban Studies at Heriot Watt University

Please cite this publication as follows:

Serin B. (July, 2016), “A Questionable Robin Hood Story: Branded Housing Projects and Public-led Commodification of Urban Space ”, Vol. V, Issue 7, pp.06 – 23, Centre for Policy and Research on Turkey (ResearchTurkey), London, Research Turkey. (http://researchturkey.org/?p=12324)

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Endnotes

[1] The article is based on PhD research, aiming to investigate the contemporary commodification of urban space under neoliberal urbanisation through the case of branded housing projects in Istanbul, the author is undertaking at Heriot Watt University.

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