Rich Cities and Poor Suburbs? Could it Happen in Auckland and Does the Onus Fall to Panuku?

It already is


In my previous post I looked at whether there was a preference for suburbs or whether that was a myth based on restrictive planning processes against the Urban city (thus creating a shortage of cities)(see: A Preference For Suburbs? Seems Not). I had also alluded to how the suburbs even in Auckland were beginning to face decline while the urban cores were facing a comeback after the reverse happened from the 50s through to the 80s.

In this post I look at the Strong Towns article on rich cities and the poor suburbs.


From Strong Towns:


This essay was originally published on City Observatory and is republished here with permission.

An urban environment Source:

There’s a new narrative going around about place. Like so many narratives, it’s based on a perceptible grain of truth, but then has a degree of exaggeration that the evidence can’t support.

Cities, we are told, are becoming playgrounds of the rich. Last week, Quartz headlined Richard Florida’s recent talk about the future of cities as: “A world famous urbanist says New York becoming ‘gated suburb.'” Florida is more nuance in his talk–highlighting a handful of neighborhoods where rich families are living in large apartments (with garages!) in the city’s upper east side. But the nuance gets lost in the journalistic retelling that focuses heavily on Florida’s warning that urban revival has a “dark side” that is creating “winner take all” cities.

It’s certainly true that we’ve witnessed a considerable rebound in the condition of America’s cities. After decades of decentralization and urban decline, things have started turning around. Population in a few cities began growing in the 1990s, and after 2000, even more cities moved forward.  In 2013, Brookings Demographer Bill Frey noted that cities had grown faster than their surrounding suburbs for two successive years and that this might constitute a “big city growth revival.”

The corollary of this narrative of city revitalization is that the suburbs are becoming poorer.


Statistically, both those statements are completely true. But let’s spend a minute unpacking that analysis. First, it helps to know how Brookings defines “city” and “suburb.” It defines city as the largest municipality in a metropolitan area, and “suburb” as virtually everything else. It turns out that by that definition, roughly 70 percent of the metro population now lives in suburbs. So it’s hardly surprising that a majority of the poor no longer live in central cities.

Suburban decay Source:

The second part of the claim is that poverty is growing “faster” in suburbs. While that’s true, it’s from a far smaller base. But despite faster growth, poverty rates—the share of people living in suburbs who are below the poverty line—are far lower than they are in cities.


Alan Ehrenhalt made these kinds of claims that theme of his book, The Great Inversion. In it, he argued that the half century long pattern of wealthy people living in the suburbs and the poor being concentrated in the central city was inverting.

As a description of the direction of change, these stories are right: many city neighborhoods are attracting more better educated and higher income residents. And many suburbs are seeing a growing number of families living in poverty.



But the narrative of “rich cities, poor suburbs” represents a vast overstatement of the scale of these changes.

The magnitude of these changes hasn’t yet come close to fundamentally altering the pattern of income and urbanization in the US. It is still the case that the poor are disproportionately found in or near the city center, and the wealthy live in the suburbs.

Urban and suburban poverty Source:

Rather that using a crude binary classification of cities and suburbs, with cleavages drawn at arbitrary and often random political boundaries, it is much more illuminating to look at the exact pattern of correlations between neighborhood income and distance to the central business district. The University of Virginia’s Luke Juday has mapped this data to illustrate the relationship between centrality (distance to the center of the central business district) and income. Helpfully, Juday has made this calculation for 1990 and for 2012 using Census data.




In the 22 years between 1990 and 2012, the central city poverty rate (1 mile from the center of the CBD) declined from 26 percent to 25 percent, while the poverty rate 20 miles away in the suburbs increased from 7 percent to 9 percent. Poverty in the center was on average 15 percentage points higher in the center than in the periphery. The gap between the two areas thus closed by 3 percentage points. At 1.5 percentage points per decade, it would take until the end of the century before poverty levels equalized between the urban core and twenty miles out.


McMansions Source:


Unless there’s a tremendous acceleration of this rate of change, an actual inversion is several decades away. And the idea that these lines would be inverted, i.e. sloping upward and to the right, meaning that poverty was higher in the suburbs than in the center, simply shows almost no signs of happening.

To be sure, a few neighborhoods have seen dramatic change, but to conclude that entire cities are becoming “gated suburbs” is a wild exaggeration of what so far, is a vary modest trend that has slightly ameliorated the centralized pattern of poverty in the US. The overall pattern of poverty in New York has hardly changed since 1990; the highest poverty rates are between 5 and 10 miles from the city center, and are more than triple the poverty rate in suburbs more than 15 miles away.



Rather than raise the alarm about what is in the vast majority of cities a very slow-moving non-crisis, our energy might be better spent thinking about how we might leverage the growing interest in urban living into a force that will undo the pattern of income segregation that has characterized the last half century or so of suburbanization — what Robert Reich called the secession of the successful.

“Now that some younger people are starting to come back to invest in city neighborhoods, commit to city schools, and exercise citizenship, there’s a huge opportunity to leverage this momentum to address the city’s poverty and segregation problems.”

Cities have been plagued for decades by desertion and disinvestment. The middle income families that could provide the fiscal and civic support for a vital city have been exiting. Now that some younger people are starting to come back to invest in city neighborhoods, commit to city schools, and exercise citizenship, there’s a huge opportunity to leverage this momentum to address the city’s poverty and segregation problems.

There are some practical policy steps that every city could take to make sure that the benefits of revitalization are widely shared. For one thing, revitalization means new jobs in or near places that have long been said to suffer from a “spatial mismatch.” Training and placing local residents for jobs in everything from construction (building and rehabilitating housing) to working in the growing retail and service businesses that are expanding in cities would directly address economic needs. The good news, as we’ve shown at City Observatory, is that the decentralization of job growth that has proceeded for decades is at an end, and jobs are moving back into cities.

Cities can also tap the added investment associated with revitalization to create more affordable housing in revitalizing neighborhoods. That’s exactly what Portland has done—dedicating about a third of the tax increment revenues from new housing development to pay for subsidized housing in urban renewal areas. The city’s tony new Pearl District is home to galleries, restaurants, theaters, high end condos and new market rate apartments. It also has more than 2,300 units of affordable housing, subsidized by tax increment financing. The result, far from being a “gated suburb” is a lively, walkable mixed income neighborhood with more economic diversity in a small area than any other part of the region.

There’s no reason why cities can’t use the economic momentum created by the interest in city living to build more affordable housing in revitalizing neighborhoods and create the kind of just, inclusive communities that we all seem to think would be a good idea. If we view economic integration as an important objective, the trends we see in cities ought to be regarded as shining examples of opportunity, rather than an inevitable “dark side” of the urban renaissance.

The apocalyptic exaggeration of nascent trends generates headlines but it’s a poor basis for making sensible policy. For too long, urban policy in the United States consisted of little more than triage and managed decline. If we’re really optimistic about cities, then we ought to be focusing our attention on constructive ways to manage this historic opportunity.

(Top photo by Desiree Peters)


Source and full article:


South and West Auckland do have a measure of suburban poverty that is not being adequately addressed by local and central authorities.  As the newly elected Manukau Ward Councillor Efeso Collins said in his maiden speech to the Governing Body of Auckland Council last week:

We have become accidental property millionaires


That statement reflects the deep inequality leading to suburban poverty in South and West Auckland as both rents and mortgage costs are more out of reach for working and even middle class citizens in those two sub-regions. This is while the City Centre is feeling in a state of richness as investment floods in on the back of Council-led regeneration (after the City Centre faced decades of decline from the 50s). Regenerating the City Centre is sorely needed with Auckland being New Zealand’s only international city of scale. But the catch is for Government and Council to spread that investment with its benefits out to the suburbs.


Panuku Issue with Manukau

Arguably and to be fair Panuku Development Auckland (Council’s property and development arm) is attempting this with Transform Manukau and Unlock Henderson (both Metropolitan Centres) regeneration projects. But onus returns to Panuku to get it right within budgets allocated. I am already aware one development project in the Transform Manukau area is 18 months overdue and has stretched Panuku’s budgets. This has come from apparent micro-management rather than letting project managers run in an autonomous manner (given they have the framework of the High Level Project Plan and soon the Implementation Plan).

With Manukau being a black-hole in previous attempts of development and regeneration I do send a warning shot over Panuku’s bow to make sure once the Implementation Plan goes live in December that we do not have any more blowouts. Manukau and the South can not afford this especially if we are to try and shatter suburban poverty in the South. And yes Manukau City Centre is the primary weapon in breaking that suburban poverty down here.


Rich cities while we have suburban poverty? It does happen here in Auckland thus we need to be careful when apply urban development policies that the suburbs are captured as much as the urban core is as well.

Granted we have a shortage of cities as I stated in my previous post but that fixing of the shortage should never be at the expense of our existing suburbs – better or for worse.


Reference post: Will Drury South Be the new Manukau of the deep South (of Auckland)?


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One thought on “Rich Cities and Poor Suburbs? Could it Happen in Auckland and Does the Onus Fall to Panuku?

  1. Regarding to the degeneration of suburbs, here is the theory:

    It is a phenomenon where a newly developed area will have the new house, new roads and new shops. The whole area will be very desirable and attract wealthy people, the schools will have high decile which further attract wealthiest people. For example (Albany, Stonefields, Hobsonville)

    However as times goes, the once new house will get old, roads will be worn, shop fronts gets old. So the wealthiest will move to out to better places, and the residences are slowly replaced with poorer people.
    This is added by the fact people who used to be middle income retired. They no longer have the disposable income. So the local upmarket shops no longer survive, and goes into decline.

    This process will accelerate, with more and more poor people move in. The once up market shops will be replaced by ghetto shops, schools will get lower decile, council will no longer have money to maintain the streets, which further decline the area. For example (Avondale, Otahuhu).

    Until the area become a total slum, coupled with the fact some areas are closed to city, those area will start to attract developer (the Rent Gap Theory). The developer will be able to buy the cheap land and redevelop them into more desirable places and earn a profit. Thats is the gentrification process. The poor people will be replaced by wealthier people. Poor people cannot afford the rent increase and eventually move out to cheaper area. For example (Ponsonby, Grey Lynn)

    This cycle will repeat. The newest suburb today, in the next 40 years will be a slum.

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