Gentrification // Current

Health of Belize Community Hangs in the Balance

On the resort island of Ambergris Caye, just off the coast of Belize, is a community sometimes referred to as the forgotten place.... more

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1 month ago

Wall Street’s Tremors Leave Harlem Shaken

Before its economic turnaround in recent years, Harlem was a case study in disinvestment.

Banks were unwilling to make mortgage loans or to open branches, national chain stores could not be lured uptown, city services lagged and the neighborhood became economically isolated from the rest of Manhattan. This has given way in the past decade to a resurgence, as national chains like Starbucks and American Apparel have moved to 125th Street and housing prices have steadily risen.

But the collapse of financial institutions like Washington Mutual Savings Bank, Bear Stearns and Lehman Brothers has left Harlem facing a double loss: The disappearance of companies that helped propel the resurgence will not only make it immediately more difficult for business people to get loans and mortgages or for developers to build large commercial projects, but will also lead to the loss of millions of dollars in charitable contributions from those same companies. That will affect everything from children’s health and adult literacy to the Apollo Theater’s famed amateur night.

The effect in Harlem of these companies’ failure is an example of the long — and in some cases, unexpected — reach of Wall Street across the city, even in neighborhoods with high poverty rates, and where relatively few people work as stockbrokers or investment bankers.

“People talk about Wall Street greed, but one of the things many people don’t understand is that there are a lot of organizations that have been the recipient of largess from the same Wall Street,” said Geoffrey Canada, president and chief executive of Harlem Children’s Zone, one of the neighborhood’s largest private, nonprofit groups. “Their absence leaves us scrambling to replace what has been a significant amount of support.”

The relationships between Harlem and the companies ranged from the personal — 240 Lehman Brothers employees helped build a six-unit apartment building and tutored children in mathematics each Saturday — to the symbolic: Washington Mutual had its name on the marquee of the Apollo as the primary sponsor of amateur night.

Then there is the strictly financial: Bear Stearns provided critical funds for the $85 million Harlem Center, a retail and office complex on 125th Street that includes, among other businesses, a Washington Mutual branch.

The tight credit market will very likely have other consequences in Harlem as well, observers said, most significantly a slowdown in economic development, which could moderate the neighborhood’s rapid gentrification.
Before its economic turnaround in recent years, Harlem was a case study in disinvestment. Banks were unwilling to make mortgage... more