Is Your Restaurant Contributing to Gentrification?

If you suddenly find your affordable rental is within walking distance of an oat milk latte, you’re probably standing in a gentrifying neighborhood. According to a 2018 study, one of the leading indicators that housing prices are about to go up is the addition of a café in the neighborhood. What might seem like a delicious addition to the area to some might signal impending displacement to others.

What exactly is gentrification? Most of us recognize it when we see it but have a hard time defining what it is. “Gentrification is the process of property speculation that jacks up prices and the displacement of the people that cannot afford them,” says John J. Betancur, professor of urban planning at the University of Illinois at Chicago and co-author of the study, The Trajectory and Impact of Ongoing Gentrification in Pilsen. 

Gentrification happens when an area that has traditionally been home to low-income communities experiences an influx of new affluent residents that results in rapid development and a rise in residential and commercial real estate prices. As a result, long-time area residents are often forced to move out of their neighborhoods or close up their businesses because the rent is too high, while property owners are often forced to sell their homes because they cannot afford the higher property taxes. 

Though this phenomenon isn’t new to urban life, it has intensified in recent decades. The reasons are complex and range from a lack of affordable housing to stagnant wages to city policies that perpetuate existing inequalities. Governing reports that since 2000, roughly 20% of lower income neighborhoods have experienced gentrification, compared to only 9% in the 90s. According to the National Community Reinvestment Coalition, most of these neighborhoods are concentrated in major cities like New York, Los Angeles, Washington D.C., Chicago, Philadelphia, Baltimore, and San Diego. 

In addition to the economic concerns, there are reasons to worry about the cultural impact of gentrification. The communities most affected tend to be predominantly Black and Latinx, and their displacement often means the whitewashing of neighborhoods and possible erasure of marginalized groups. 

The restaurant industry has found itself center stage in the debate over gentrification, as restaurants are typically the first businesses to test moving into a new market. Proponents of this type of development argue that it provides new income and business in under-served areas, while those who oppose it are calling out that gentrification disrupts long-standing communities and pushes them out of their homes. 

Choosing a location for a new restaurant is already challenging, but restaurant owners and operators must be thoughtful in their real estate choices. Otherwise, they run the risk of creating a space that’s inaccessible or unwelcoming to long-time residents, spurring tensions with the existing community, rocky relationships with local shops and organizations, and sometimes, the kind of PR scandals that make headlines. 

In a community experiencing gentrification, there can often be anger, resentment, wariness, and a lack of trust. To the existing community, outsiders can be seen as pushing their friends and loved ones out of their homes; to the newcomers, the existing community may seem hostile and unwelcoming. 

If you’re opening up a restaurant in an “up-and-coming neighborhood” — which is real estate marketing speak for “gentrifying” — it’s important that you be sensitive to the thoughts, feelings, and needs of the existing community and create a dialogue with local patrons and business owners. 

We talked to restaurant owners in the Pilsen neighborhood of Chicago to learn how new restaurant owners can be a respectful members of their new communities and make a positive contribution without glossing over the fact that another member of the existing community had to leave (likely under unpleasant circumstances) in order for the location to open up.

What real restaurateurs experiencing gentrification want their new neighbors to know

1. Be mindful of the economic realities of the neighborhood

One of the major mistakes that new restaurants make when moving into a traditionally low-income area is setting menu prices that are too expensive for the surrounding community to afford. When pricing your menu, ask your team and other members of your new community to weigh in about whether a meal at your restaurant would be affordable for local residents, especially considering that you might be taking advantage of lower overhead costs.  

“Everybody’s taking advantage of the fact that Pilsen is a vibrant, diverse, open community,” says Mer Mansuria of Casa Indigo, a Mexican restaurant in the rapidly-gentrifying Chicago neighborhood of Pilsen. “But rent is five times as high in the West Loop as it is here,” he points out. Catering to the existing community by being mindful of their budget is one way to avoid pricing them out by relying on the business of more affluent residents or visitors.

2. Hire from within the neighborhood

As a restaurant owner or operator, you can play an integral role in stimulating the neighborhood’s economy by hiring people from within the area. This is the biggest way that you can make a positive impact in your community. Alexandra Curatolo of Belli’s, a juice bar in Pilsen, made it a point to do so. “Before I even started, I made relationships with people within the neighborhood. I tried to hire as locally as possible,” she said. 

It’s a sentiment that Mansuria also echoed. “Hire local kids and give them a livable wage,” he said, noting that most people want to work close to home anyway. Chefs in other cities, like Marcus Samuelsson, have taken similar steps. In Samuelsson’s new Newark restaurant, Marcus B&P, the chef hired 80% of his employees from the neighborhood and brought in 20% of employees from his other locations. 

When it comes to hiring restaurant staff, it’s important to make sure that you are being inclusive in guest-facing positions as well as those on the line. “What I’ve noticed in these restaurants is that the hosts and the wait staff tend to be young, tend to be white,” says Christian Diaz, the Lead Housing Organizer of the Logan Square Neighborhood Association, another rapidly gentrifying area in Chicago. “But if you look at who's working in the back kitchen, it [could be] my uncle. And they don't get tipped.”  

Today, roughly 60% of chefs and head cooks are white while only 12% are black. There are so few Latinx chefs and head cooks that they are simply counted as “other,” despite the very high concentration of Latinx people working in kitchens.

3. Be attuned to cultural preferences

If you’re opening a restaurant in an area where the primary language spoken is not English, operating a restaurant with a staff that only speaks English will alienate customers in the community and hurt your reputation. If you don’t speak the language of your local community, consider taking steps to learn the language. 

In the conversations we had with Chicago restaurant owners, the importance of catering to the existing community was stressed again and again. This includes making sure your neighbors and local community members don’t feel ostracized for economic reasons, socio-cultural reasons, or because of a language barrier. “I made sure half of the people who worked here spoke Spanish, so they could speak to those who might not know English,” says Curatolo. A language barrier may prevent you from providing the best service, so it helps to make sure someone in the establishment can be a liaison. Consider having bilingual menus, too, as Curatolo does at Belli’s. 

We’re in the hospitality industry: Our main goal is to make people feel welcome; this applies to our customers and our community members. Heck, welcoming your community members will likely introduce you to new customers and business opportunities. 

If the community is very family-oriented, make sure you can accommodate large parties. Post photos on social media that reflect the diverse demographics of your team and community, and train your staff to be welcoming and accommodating to everyone who walks through the door. “I know my mental emotional health, as a long-term resident, benefits from seeing just even a small gesture,” says Diaz. “For example, some restaurants have signs on their doors that explain the rights of undocumented immigrants. Maybe a restaurant can have a sign that says ICE is not welcome here. We just want to feel seen.”

4. Support local businesses in your new neighborhood

When looking for providers and services, look first to options available within your local community. Establishing business-to-business opportunities and collaborations will not only help you make more friends in your community, but it will contribute dividends to your local economy.

“In neighborhoods like Pilsen, we rely on our social networks,” says Curatolo, noting that Mom & Pop shops already exist in these areas and depend heavily on each other for support and promotion. In her juice bar, she carries products from different neighborhood vendors and hired two neighborhood photographers for her promotional materials. She also sources some of her ingredients from the local community garden.

Mansuria also values including local businesses in his restaurant’s operations. “We try to cut out huge corporate vendors as much as we can,” he says, turning to many local businesses for ingredients and supplies, including chorizo from their neighborhood grocer, Casa del Pueblo, and aprons from the independent boutique, Block Party. “If we can’t find it within our own community, only then do we reach out somewhere else.”

5. Support local community initiatives

A great way to establish ties within a community is to get involved with existing local activities or organizations and offer to support however you can. Curatolo has provided workshops to neighborhood schools, is active in her local community garden, and offers a youth internship program every summer. On his end, Mansuria sponsors local baseball teams and works with several non-profits in Pilsen as well. His restaurant hangs artwork from local artists and all profits from art sales go to them.

6. Advocate for your community

One of the most impactful ways you can become part of the neighborhood is to speak up for the members of your community who are most vulnerable and marginalized. Local government has a huge hand in creating housing policy and facilitating development. Local government also has an interest in working with private businesses and enterprises for the betterment of its community. 

Diaz says that when it comes to gentrification, it’s important to keep in mind that the problem lies in systemic issues and not necessarily individual choices. Yet within that choice, we can work to create a positive impact. 

“The aldermen always talk about how they want to bring in more businesses to the ward, more jobs for their community,” says Diaz. “Restaurant owners have some level of power that they can use, not just within their physical space, to be more welcoming.” This may mean advocating for public policy that addresses the root causes of gentrification, whether by showing up to community meetings to discuss new construction or even getting involved in local political campaigns. 

Being aware of the issues surrounding gentrification and being an active participant in the neighborhood shows that your establishment isn’t there to cash in on a location but to build roots. As Mansuria says, “If you’re having success in the community, give back to the community as well.”