Well, it’s an enor­mous plea­sure to be here and I’m real­ly hon­ored to fol­low Ada Colau. I’m a great admir­er of the project. I want to talk a bit about what is a city. I think up till quite recent­ly you could say that if it was very dense­ly built, it was a city. Let me posit that today, a lot of den­si­ty is actu­al­ly deur­ban­iz­ing the city. Think of megapro­jects that take over urban tissue—little streets, lit­tle squares, lit­tle old build­ings. Places that long-term res­i­dents felt this was their place. When that hap­pens, when that inserts itself into a city, no mat­ter how it adds to the den­si­ty, I would argue it deur­ban­izes.

And so what I want to talk about (and I have clear­ly very lit­tle time but there’s a very long text for those of you are inter­est­ed), I want to talk about invest­ments that are hap­pen­ing in prop­er­ty. So let me just move straight into it. I’m work­ing with a data set of the top hun­dred cities that are the object of desire, if you want, of investors. A lot of this investment—what I’m talk­ing about, min­i­mum price to give you a sense, an idea—is five mil­lion in the case of New York. The val­ue is going to change in oth­er places. Mostly what I’m focus­ing on here is either cor­po­rate build­ings or very lux­u­ry apart­ments.

Now, for me a city, just as back­ground, is a com­plex but incom­plete sys­tem. And in that mix­i­ty of com­plex­i­ty and incom­plete­ness lies the capac­i­ty of cities to have very long lives. Much longer lives than very pow­er­ful cor­po­ra­tions, which often are very closed sys­tems. So if you think of a city like London— I don’t know about Venice. I would not dare to talk about Venice, being here in Venice. But if you think of New York City, if you think of London, those are cities where most of the very pow­er­ful cor­po­ra­tions that once exist­ed (I empha­size: most, not all) no longer exist. But the city of London, I mean the larg­er city, exists. And so do the neigh­bor­hoods.

And the neigh­bor­hoods are mod­est places. They have out­lived very pow­er­ful actors. So it tells you some­thing about the city. It can­not be reduced to sim­ply a set of cor­po­rate sec­tors.

Now, here are some fig­ures on invest­ment. This is just acquir­ing prop­er­ty. This is not about devel­op­ing. And the full list is a hun­dred. And I also just got the data for the last year. This is one year, 2013 to 2014. And you can see that New York Metro region is at the top, fifty-five bil­lion. This is just one year. This is a process that real­ly takes off after to 2008, the cri­sis, but real­ly becomes very very strong in the last few years. London Metro, num­ber two, etc., etc. Paris, num­ber six. Most peo­ple in Paris, by the way, are bare­ly aware that this is hap­pen­ing. I’m look­ing for­ward to Missika’s talk here.

Now, this is anoth­er way of dis­trib­ut­ing. So, when you look at the top hun­dred cities, at the end it is a very sort of small share. And as you can see there, Miami is at the bot­tom of this. But this again I repeat: this is a list of a hun­dred.

So this is for­eign prop­er­ty. I want­ed to empha­size that if you look at for­eign invest­ment… In oth­er words not nation­al but all kinds of for­eign, then London is num­ber one. And what is quite inter­est­ing is, if you want, the invis­i­bil­i­ty of it. So I like to point out what does this is all look like?

And here is one case. This is one Chinese com­pa­ny that owns all of these build­ings. They’re most­ly land­marked. Nothing can be changed, at least for a while. And I think, very good taste, by the way, this com­pa­ny. These are very very nice. I don’t par­tic­u­lar­ly like that one over there. And that is prob­a­bly not a land­mark build­ing.

But the point here is this is not just about buy­ing and tear­ing down. When you hear peo­ple walk­ing by, their tours— I did did a long walk with some­body from Die Zeit who was writ­ing a sto­ry about all of this, and you heard the tourists lit­er­al­ly say, Look at these won­der­ful British build­ings.” Of course they’re British build­ings, you know British his­to­ry. But they’re all owned by one Chinese com­pa­ny.

So there is a sec­ond issue here that I want to point out, which is that in all its mate­ri­al­i­ty, this is a kind of invis­i­ble project. You know, you don’t know that it is foreign-owned. Now, I do think that the fact that it is foreign-owned mat­ters that much. My main con­cern is this big capac­i­ty that cor­po­ra­tions have to buy a whole set of build­ings. I don’t know exact­ly where that goes, but that pri­va­tizes. And that’s sort of destroys some of this notion of the incom­plete­ness of cities.

Now, this is anoth­er case. This is actu­al­ly site devel­op­ment. This is also a for­eign com­pa­ny that has bought a very big piece of land in New York. And that I would say is not good taste. They are build­ing four­teen of these huge tow­ers. That again rais­es the den­si­ty, but actu­al­ly deur­ban­izes that space.

Now if you look at all of these fig­ures when it comes to the stop one hun­dred cities, they rep­re­sent 10% of the world’s pop­u­la­tion, 30% of the world’s GDP, and 76% of prop­er­ty invest­ment.

If we want­ed to enter let’s say the gos­sip columns— This data actu­al­ly exists. I didn’t gath­er this. And you can see these are the glob­al mul­ti­mil­lion­aires, etc. and here are all the cities. It includes Capetown, Palm Beach, Sydney, etc. This is not of par­tic­u­lar inter­est to me, but what is inter­est­ing is the amount of buy­ing that is hap­pen­ing. And that to me, com­ing back to this def­i­n­i­tion of the city as com­plex but incom­plete, I find a lit­tle dis­turb­ing.

The total val­ue, the world­wide real estate assets— Now when you talk that lan­guage (real estate assets) it means that there’s a bit of finan­cial­iz­ing that has hap­pened, right? It can cir­cu­late glob­al­ly as a val­ue. It’s $217 tril­lion. That’s a lot of zeroes. I know that this lan­guage trans­lates very very dif­fer­ent­ly in dif­fer­ent lan­guages, but you can see it’s quite a bit.

Now, just to put this in per­spec­tive, if you look at the val­ue of finance, just as a jux­ta­po­si­tion, where the typ­i­cal mea­sure is out­stand­ing deriv­a­tives, that is in the quadril­lions. So finance is way ahead. But if you look at some­thing like glob­al GDP of all the coun­tries in the world, then you are back to the tril­lions, you know. Like $800 tril­lion. So this is quite a bit. I give you these oth­er fig­ures so that you under­stand what it is.

So, this is anoth­er way of look­ing at what this all looked like. And this is London prop­er­ty pur­chased by over­seas com­pa­nies from 2005 to 2014. And you can see it’s a lot. London is a key des­ti­na­tion, you know. I think its his­to­ry of empire is also con­tribut­ing to this. You know, his­to­ry sort of catch­es up.

And here we go to Manhattan. And one thing that is very impor­tant in Manhattan in this whole bit of buy­ing are shell com­pa­nies. So I just want to run you very quick­ly through some fig­ures that have to do with that. So here you have that in 2014, 54% of sales over $5 mil­lion in Manhattan were to shell com­pa­nies. Shell com­pa­nies are fic­ti­tious com­pa­nies. They real­ly… This is sort of some­thing that’s an instru­ment to buy, in this case.

Now come two or three very famous, fan­cy, much-admired, blah­blah, build­ings. (Not admired by every­body, by the way. But still, admired.) Time Warner Center. A hun­dred and twenty-two of the 192 con­dos are owned by peo­ple who use shell com­pa­nies that hid their iden­ti­ties. So you get a pic­ture.

Here is anoth­er famous build­ing in Manhattan, Bloomberg Tower. Fifty-seven per­cent of com­dos are owned by shell com­pa­nies. And that is why so many of these build­ings at night are dark. You don’t see life in there, real­ly.

And this is The Plaza. Sixty-nine per­cent of con­dos are owned by shell— And so it goes on and on.

Now, that’s not all that is hap­pen­ing in this domain that is con­cern­ing me—that wor­ries me a bit. One is the invent­ing of new hous­ing mar­kets. Which is real­ly a kind of match­ing mar­ket. Which is used by uni­ver­si­ties if they want to hire spe­cial­ized peo­ple. They go to only some oth­er uni­ver­si­ties to recruit. But this is a very inter­est­ing appli­ca­tion of that con­cept.

So here you have one of these match­ing mar­kets. And the list goes on. I just have a few here. And the key fea­ture is min­i­mum prices. So, in the case of Monaco, and the main nation­al­i­ties. What you see here are the main nation­al­i­ties, and the prices.

In the case of Monaco, $18.9 mil­lion, etc. The Financial Times pre­pared this a few years ago. So there you see it goes on and on. Very inter­est­ing to me is that in Shanghai, if you see, the world is buy­ing. Hong Kong, it’s most­ly main­land Chinese who are buy­ing. These are the main nation­al­i­ties, not the only ones. And Dubai has a very inter­na­tion­al struc­ture that is quite dif­fer­ent from oth­ers.

Now, a Guardian pho­tog­ra­ph­er got access to some of these prop­er­ties, and I’m just show­ing you two images. Some of these properties—this is London—have not been inhab­it­ed for years.

Here’s anoth­er one. It takes quite a bit of time for that much moss to grow. 

Now, jux­ta­pos­ing (and again this the case of the United States), we have mil­lions of house­holds that have been thrown out of their homes. Which also gen­er­ates more emp­ty urban space. This is a list of fore­clo­sures. The data come from the cen­tral bank. When Bernanke, the head of the Fed in New York— When he stepped down, he made a big speech about all the good things. And then he said two things that were intractable. One con­cerned finance. Dark pools in finance; I won’t talk about that. The oth­er one con­cerned this.

He said and by the end of 2014… It’s always 2014 that comes up, so don’t get too con­fused. So, by the end of 2014, he said, four­teen mil­lion house­holds will have lost their homes. So, this is a very seri­ous kind of sit­u­a­tion.

It’s hap­pen­ing in Europe, too. Germany, over a mil­lion— The list goes on after 2009, over a mil­lion house­holds. A house­hold can be one, two, three peo­ple. In the case of the United States we’re talk­ing about mil­lions, thir­ty mil­lion min­i­mum. And again, in its mate­ri­al­i­ty, this is an invis­i­ble sto­ry.

So why does this all mat­ter? And here I want to come back to this notion of the city. So I start­ed out say­ing the city’s a com­plex but incom­plete sys­tem. If you have mas­sive projects, mas­sive den­si­ties, you are los­ing urban­i­ty. You are los­ing city­ness. You’re adding den­si­ty which, you know, for some is enough to have a city. But there is more. In a way, the large cities espe­cial­ly are one of the few places where those with­out pow­er get to make a his­to­ry. They get to make a cul­ture. They get to make an econ­o­my.

They are also today’s fron­tier zone, I think. I think of a fron­tier zone as a zone where actors from very dif­fer­ent worlds can have an encounter. If you think of low-wage work­ers, or low-income fam­i­lies, it’s in cities where they actu­al­ly can have an encounter with pow­er, with wealth, etc. And out of that comes learn­ing. Out of that can come oppo­si­tion­al­i­ty. And I think that we need to pro­tect the cityness of cities. And I think, as I said already, more and more build[ing] stuff is not nec­es­sar­i­ly city. It’s not nec­es­sar­i­ly urban.

And one prop­er­ty, one capac­i­ty that cities have is that— And it’s very par­tial, it’s very momen­tary. That at var­i­ous times of the day, the city reduces us all, or makes us all (in a more pos­i­tive sense) urban sub­jects. Not reli­gious, not class, not eth­nic. No, urban. And these are very pre­cious moments of the day. But they enable that. There are very few spaces that allow that.

Now, if you think of large, com­plex, cor­po­rate setups, that does not enable that. The poor, the low-income work­er, can go in there and clean. But when he’s done, he goes out. In the city, on the oth­er hand, you have a lot of neigh­bor­hoods that are poor, where real lives can take place. Where local economies are made. Where lit­tle local cul­tures can thrive. So in that sense, the his­to­ry that we are wit­ness­ing, that is hap­pen­ing, I think is very dis­turb­ing to me.

I want to jux­ta­pose to that the fact of land grabs in the Global South. When you take the broad­er map of the buy­ing up of what once may have been a mix of pub­lic and pri­vate and it all becomes pri­vate, both in rur­al areas and in urban areas, you begin to think about a larg­er cat­e­go­ry that has to do with life space. How do we secure futures that enable many many peo­ple to keep on liv­ing in cities that are real cities? Thank you very much. 

Help Support Open Transcripts

If you found this useful or interesting, please consider supporting the project monthly at Patreon or once via Square Cash, or even just sharing the link. Thanks.