Redeveloping Tehran: A Study of Piecemeal Versus Comprehensive Redevelopment of Run-Down Areas (The Urban Book Series) 9783030970901, 9783030970918, 3030970906

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The Urban Book Series

Kiavash Soltani

Redeveloping Tehran A Study of Piecemeal Versus Comprehensive Redevelopment of Run-Down Areas

The Urban Book Series Editorial Board Margarita Angelidou, Aristotle University of Thessaloniki, Thessaloniki, Greece Fatemeh Farnaz Arefian, The Bartlett Development Planning Unit, UCL, Silk Cities, London, UK Michael Batty, Centre for Advanced Spatial Analysis, UCL, London, UK Simin Davoudi, Planning & Landscape Department GURU, Newcastle University, Newcastle, UK Geoffrey DeVerteuil, School of Planning and Geography, Cardiff University, Cardiff, UK Jesús M. González Pérez, Department of Geography, University of the Balearic Islands, Palma (Mallorca), Spain Daniel B. Hess , Department of Urban and Regional Planning, University at Buffalo, State University, Buffalo, NY, USA Paul Jones, School of Architecture, Design and Planning, University of Sydney, Sydney, NSW, Australia Andrew Karvonen, Division of Urban and Regional Studies, KTH Royal Institute of Technology, Stockholm, Stockholms Län, Sweden Andrew Kirby, New College, Arizona State University, Phoenix, AZ, USA Karl Kropf, Department of Planning, Headington Campus, Oxford Brookes University, Oxford, UK Karen Lucas, Institute for Transport Studies, University of Leeds, Leeds, UK Marco Maretto, DICATeA, Department of Civil and Environmental Engineering, University of Parma, Parma, Italy Ali Modarres, Tacoma Urban Studies, University of Washington Tacoma, Tacoma, WA, USA Fabian Neuhaus, Faculty of Environmental Design, University of Calgary, Calgary, AB, Canada Steffen Nijhuis, Architecture and the Built Environment, Delft University of Technology, Delft, The Netherlands Vitor Manuel Aráujo de Oliveira

, Porto University, Porto, Portugal

Christopher Silver, College of Design, University of Florida, Gainesville, FL, USA Giuseppe Strappa, Facoltà di Architettura, Sapienza University of Rome, Rome, Roma, Italy Igor Vojnovic, Department of Geography, Michigan State University, East Lansing, MI, USA Claudia Yamu, Department of Spatial Planning and Environment, University of Groningen, Groningen, Groningen, The Netherlands Qunshan Zhao, School of Social and Political Sciences, University of Glasgow, Glasgow, UK

The Urban Book Series is a resource for urban studies and geography research worldwide. It provides a unique and innovative resource for the latest developments in the field, nurturing a comprehensive and encompassing publication venue for urban studies, urban geography, planning and regional development. The series publishes peer-reviewed volumes related to urbanization, sustainability, urban environments, sustainable urbanism, governance, globalization, urban and sustainable development, spatial and area studies, urban management, transport systems, urban infrastructure, urban dynamics, green cities and urban landscapes. It also invites research which documents urbanization processes and urban dynamics on a national, regional and local level, welcoming case studies, as well as comparative and applied research. The series will appeal to urbanists, geographers, planners, engineers, architects, policy makers, and to all of those interested in a wide-ranging overview of contemporary urban studies and innovations in the field. It accepts monographs, edited volumes and textbooks. Indexed by Scopus.

More information about this series at https://link.springer.com/bookseries/14773

Kiavash Soltani

Redeveloping Tehran A Study of Piecemeal Versus Comprehensive Redevelopment of Run-Down Areas

Kiavash Soltani Sharmand Consultants Tehran, Iran

ISSN 2365-757X ISSN 2365-7588 (electronic) The Urban Book Series ISBN 978-3-030-97090-1 ISBN 978-3-030-97091-8 (eBook) https://doi.org/10.1007/978-3-030-97091-8 © The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG 2022 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Springer imprint is published by the registered company Springer Nature Switzerland AG The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland

Foreword

In the last four decades a vast literature has been produced in English about the need and the efforts to renew and regenerate urban areas whose environmental qualities, social fabric, and economic lifeblood had declined. The vast majority of this literature has focussed on the decline and regeneration processes of cities in the West, especially in the US and the UK. In those places, the institutional apparatus of reasonably well developed welfare states has sought with variable degrees of success to marshal market forces and public sector actions, often in large-scale interventions, sometimes with direct community involvement, to address the complex task of regenerating urban areas. The challenge has been how to secure enough resources to effect longlasting change, how to counteract the adverse economic dynamics that led to decline, how regeneration projects could be accountable to the communities they should benefit, how the perennial problem of gentrification could be addressed, and how to secure that whole process is environmentally sound, socially fair and will indeed bring much desired long-lasting economic change. The dichotomy state and market and establishing the potential role for each in providing solutions to those problems has been a central point of contention in the discussion about urban regeneration: what should be the right combination of public sector intervention and market-led processes, including the role of real estate and the logic of real estate markets. Globalisation and associated structural changes in national economies has meant that the challenges of regenerating cities are no longer restricted to Western cities facing de-industrialisation. A relatively unexplored and important field of enquiry is the usefulness and appropriateness of the conceptual frameworks and practices of urban regeneration developed in the last four decades in the West to the often very different social, economic, political, and institutional contexts of cities in other parts of the World. This is precisely what Kiavash Soltani attempts to do in this book, by comparing two different modes of urban regeneration as applied to two different neighbourhoods in Tehran. The types of challenges present in those neighbourhoods are those instantly recognisable in similar places in fast urbanising cities in the Global South: significant population influx over a short period, rapid densification without the necessary supporting infrastructure both physical and social, poor environmental quality, v

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and precarious local economies. In one of these neighbourhoods, we see a familiar approach to regeneration through a large scale, state-led intervention with centralised planning, a complex institutional architecture, and a rigid system of rules and procedures necessary for that kind of operation which requires substantial changes in the layout of the neighbourhood and wholesale reconstruction. In the other neighbourhood we see a much more laisser-faire approach but with still some degree of coordination, which relies on piecemeal interventions dependent on the initiative of local property developers, landowners, and residents, and consequently a much more uncertain timeline and outcome. It would be too simplistic to compare the two and say one is right and the other is wrong or one is better and the other is worse. Precisely the value of this book is that it relies on in-depth research in both areas to bring to life the actual complexities, strengths, and weaknesses of both approaches and what they have or have not managed to achieve, bringing with that intended and unintended results. We can clearly see the limitations of state actions that are superimposed upon the social and economic dynamics of the locality without fully understanding it, but we can also see the fragmentary and uncertain outcomes of a reliance on local actions and its difficulty in producing structural changes in the neighbourhood. Centralised, topdown actions cause resentment and lack of cooperation, but bottom-up familiarity risks reproducing existing structures and curtailing needed change. The book presents the results of regeneration intervention in these two areas and invites us to think critically about the limitations and potential of two opposite approaches to urban regeneration with relevance to cities in the Global South. By doing so, it also helps us tackle the issue of the role of different social structures and agents in regenerating cities, but in a way that goes beyond the parameters of a mostly Eurocentric debate on the roles of state, markets, and civil society and better equips us to consider realistic solutions to urban problems around the world. The cases discussed in this book are in Iran, but the issues it deals with and the considerations it makes have a much wider application. September 2021

Claudio De Magalhães Head of The Bartlett School of Planning University College London London, UK

Preface

Tehran, the capital of Iran, on the one hand faces extensive deterioration in its inner-city neighbourhoods and on the other hand faces rapid population growth. The government adapted urban regeneration as a policy that not only accommodates this growth within the city boundaries but also tackles the deterioration problems. In this respect, this research compares two urban regeneration models, namely, piecemeal and comprehensive redevelopments. In doing so it tries to understand how these two redevelopment models operate in run-down neighbourhoods of Tehran. This question is addressed by analysing the implementation and property development aspects of each redevelopment, with a specific focus on developers’ behaviour regarding these two models. At a theoretical level this research compares direct versus indirect planning in urban regeneration interventions from an institutional perspective. This derives from the work of Webster and Lai (2003), where they examined spontaneous planning versus centralised planning, and Carmona (2009), where he analysed different modes of planning that on the one hand ranges from plan-based to opportunity-based and on the other hand from state-led to market-led modes of planning. Further, by building on the institutional perspective offered by Healy and Barret (1990) and Guy and Henneberry (2000), the research utilises the structure and agency approach to unravel the behaviour of property actors. Two neighbourhoods that have undergone redevelopments in Tehran, one piecemeal and one comprehensive, are chosen as case studies. As such, this research is an empirical account of two developments, utilising institutional analysis as a qualitative methodological approach in unravelling the ways in which property actors see the development process and their subsequent actions. This research improves our understanding of the process of built environment production and the role of the state in the development process. It has demonstrated that the development decisionmaking cannot be solely understood as the result of economic rationality, as it occurs within institutional contexts structured by dynamic needs and concerns of actors. In

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advancing institutional analysis, the research, by focussing on two specific projects, demonstrates the different approaches taken by property developers, development organisations, and planners as they engaged differently with the wider structures set by the government through different policies. Tehran, Iran

Kiavash Soltani

Introduction

In order to embark on this research, it is important to highlight the reasons why it was conducted in the first place. First, Tehran was chosen as a case study as it was experiencing extensive deterioration. In 2009 approximately 3200 hectares of rundown areas were identified in Tehran, since then approximately twenty percent of these areas have been redeveloped with the help of facilitative policies. The potential risk of earthquakes is one of the major drivers for urban regeneration in these areas. Iran has one of the highest rates of earthquake vulnerability in the world, and human casualties and physical damages prove to be at their maximum in run-down urban areas. One has to add the social deprivation that exists in these areas in order to get a glimpse of the extent of the problems that Tehran and other major cities in Iran were facing. Second, urban regeneration was studied as an urban intervention policy, as on the one hand it was the policy of the municipality of Tehran towards run-down areas. On the other hand, it also seems that regeneration is one of the only ways to accommodate urban growth within city boundaries while improving the dilapidated conditions of run-down areas at the same time. As such, this research tries to address this debate in the field of urban planning, which more specifically is an ever-increasing problem in developing countries, where cities are not only experiencing rapid growth but also facing high levels of deterioration. The practice of regeneration is still in its infancy in Iran, with a clear lack of implemented regeneration projects. One of the only examples of a completed redevelopment project at the time of this research was the Navab project, a major technocratic, top-down intervention in a run-down neighbourhood in Tehran. Its failure is attributed to many reasons, including total disregard for the previous urban fabric, failure in responding to social issues, absence of public participation, and compulsory evacuation of residents. In financial terms, failures in feasibility and cost-benefit analyses of the project resulted in substantial subsidy requirements for the project, and an over-optimism in financial projections resulted in the project being abandoned for two years. These pressures led to the elimination of nonprofitable land uses of the initial scheme, including schools, cultural spaces, and green spaces.

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If one looks at the community aspects and the participatory nature of urban regeneration projects, there was also a clear absence of implemented examples. The case study that was chosen as the comprehensive redevelopment example for this research, Khoob-Bakht, can be described as one of the first urban regeneration schemes in Tehran with the goals to regenerate a neighbourhood for its own residents and to improve their quality of life. The Urban Regeneration Organization of Tehran (UROT), which was also responsible for the Navab project, viewed Khoob-Bakht as a model for urban regeneration projects in Tehran. Third, two different redevelopment models are studied in this research. On one hand, the Khoob-Bakht project is characterised as a comprehensive redevelopment model, whereby a master planned redevelopment is implemented by a direct state-led planning effort. On the other hand, a piecemeal redevelopment model is characterised as a mode of planning that is less top down and more spontaneous in nature. This approach was discussed extensively in the urban regeneration and planning literature, and it was studied as a contrasting redevelopment model. These two redevelopments each represent a theoretical approach towards regeneration. One represents direct planning by the state, while the other is the materialisation of indirect planning with the help of the market. By analysing these two models, the research not only tries to understand how they operate and function on the ground but also tries to find alternative ways to redevelop run-down areas by exploring the benefits and drawbacks of each model.

Research Objectives and Theoretical Background In the regeneration debates there has been a quest for finding alternative ways for regenerating run-down urban areas. This gap in literature was a central focus of this research, as highlighted by numerous authors, including Porter and Shaw (2009), who raise the need for research in alternative ways to “comprehensive redevelopment” through the land assembly. More specifically, on the property development aspect, which is a focus of this research, Adair et al. (1999) mention that little knowledge is available on the private sector’s investment or their attitude, behaviour, strategy, and perception of risk within the urban regeneration practice. Guy et al. (2002) highlight that little research has been done on understanding how property development works within urban regeneration and in analysing the motivation of investors. Similarly, Nappi-Choulet (2006) states that urban regeneration and real estate investment principles require further attention in urban studies. Further, each of the development models analysed in this research has its own supporters and critics. Cheshire (2006) believes that piecemeal development is a natural characteristic of cities, and they have developed in that manner throughout history, with occasional major interventions. This underscores the need for refit and reorder models in the built environment as opposed to new build. On the other hand, Turok (1992) believes that large-scale redevelopment for major economic restructuring in cities might be required where piecemeal development is not the answer.

Introduction

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Fig. 1 Modes of planning (Source Carmona, 2009, Copyright Elsevier 2009)

He gives the example of urban regeneration projects in old industrial sites or areas of dereliction, which had a growth-oriented approach. Their benefits were supposed to go to disadvantaged groups. Guy et al. (2002) argue that this type of redevelopment is favoured amongst financial institutions, which are the main financiers of regeneration projects in the Western economies. At a theoretical level, an overarching argument that provides a comparative analysis nature to this research is based on the work of Webster and Lai (2003), where they demonstrate the ways in which cities are organised and managed by highlighting the market impact. They start by discussing market versus planning and move on to comparing imposed and centralised coordination versus spontaneous and decentralised coordination in urban development. Further, the work of Carmona (2009) adds another dimension to analysing these modes of planning. Carmona in his research studied the redevelopment processes that London Docklands went through, using the diagram illustrated in Fig. 1. This diagram categorises planning modes based on two related axes: one axis ranges from plan-based to opportunity-based and the other from state-led to market-led modes of planning. The following model creates four quadrants, serving as another analytical tool for exploring the two redevelopment models of this research. Further to the overarching comparative framework, institutional economics theories also informed the analysis. Building on Healey and Barret (1990) and Guy and Henneberry (2000), this research is an empirical account of two developments, utilising institutional analysis based on behaviour of actors and studying the relation between “structure and agency” in the development process. The “structure” is the development process and the planning framework within which the agents operate (i.e., direct and indirect planning modes), and the “agency” is the way in which individual agents and property actors pursue their objectives (i.e., developers and planners). Utilising institutional analysis as a methodological approach, the research unravels the ways in which property actors see the development process and their subsequent actions.

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The theories that have stemmed from practices in developing countries are also utilised, highlighting the cultural, socioeconomic, and political issues that exist in this context. This builds on the work of Parnell and Robinson (2012), which calls for greater research emphasis on the cities of the global South, property markets, and market enabling strategies, as well as different modes of housing provision in the context of developing countries. Further, as the research is conducted on a country where the role of the state is less significant than in the more developed societies, the role that individual actors play in housing provision has received special attention. Drawing on the work of Allen et al. (2004), where they analysed southern European states, the research looks at different roles that residents, families, and developers play in the two redevelopment models. And more generally, the role of the state in urban intervention in developing countries is discussed based on the work of Mukhija (2001 and 2004). In practical terms, as analysing implementation aspects of regeneration was a key component of this research, case studies were analysed during implementation in 2010. This approach provided a platform to analyse the dynamics of implementation through interviews with key actors on current issues, as well as the benefit of direct observation of implementation on the ground. This aspect would have weakened if the projects were analysed post-completion, as elements of “soft data” collection that are critical to institutional analysis would not be easily accessible upon project completion. Nevertheless, the cases were also revisited 11 years later in 2021 to provide a post-completion and more current analysis of the case studies to the readers.

Research Methodology Taking into consideration the questions raised in the literature and the context of Tehran, the main research questions were devised as follows: • How do piecemeal and comprehensive redevelopment models operate in the rundown neighbourhoods of Tehran? – Specifically, how they operate in terms of implementation and property development? – What is the developer/investor behaviour regarding these two models? Each redevelopment model is defined as follows: Piecemeal redevelopment is a redevelopment model that retains the existing street layout and urban structure. Land assembly is limited to some projects, and the implementation period is much longer compared to that of comprehensive redevelopment. Comprehensive redevelopment is a redevelopment model that results in a new urban structure and street layout of a neighbourhood. Implementation is through land assembly based on a new urban layout, with almost all the existing buildings reconstructed.

Introduction Fig. 2 Matrix structure of the research (Source Figure created by author based on concepts from Dunleavy, 2003)

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Argumentative dimension Analytical dimension

Direct Planning

Indirect Planning

Implementation aspect

Property Development aspect

The comparison uses the argumentative dimensions of direct and indirect planning, which are the theoretical constructs of the research. These are then explored individually through the analytical dimensions of implementation and property development as illustrated in Fig. 2. Further, this research builds on institutionalist methodological considerations, building on the work of Guy and Henneberry (2000) and Healey and Barret (1990) as discussed earlier. Guy and Henneberry (2000) argue that property research should evolve from a science of investment to a mode of inquiry encompassing the complexities of the development process and the dynamics of demand. They argue that research based on mainstream economics in the positivist tradition fails to unravel the dynamic and contextual relationships between social action and economic structures in development processes. As such, institutionalist approaches can assist in understanding the causalities in development processes through case study research. Although generalisations can be made through institutionalist approach, they also warn that results cannot be overgeneralised due to the case-specific nature of social and economic issues. Further, Healey and Barret (1990) call for a methodological awareness with regards to empirical research based on an institutional approach. They give warnings about the challenges in data gathering on property development processes, as they involve secretive strategies, and about how publicly available information can be scarce. Nevertheless, they highlight cases where researchers managed to successfully penetrate development processes. The main field study was undertaken from June to October 2010 in Tehran, in order to analyse regeneration projects during implementation. Multiple sources contributed to data triangulation and convergence of evidence, including interviews, direct observation, historical maps, census data, development permit data, municipality master plans and reports, consultant reports on each project, industry publications, and urban planning news. Sixteen in-depth semistructured interviews were conducted with the main actors of the redevelopment projects, who comprised the key informants of the study. The interviewees were selected based on those who could provide information about the research questions. As such, developers, city officials, planners, and industry representatives were interviewed. Interviewee selection was informed from the structure and agency approach of the institutional perspective, with the planning framework as the structure and the developers as the agency. In order to analyse the

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regeneration projects upon completion, the case studies were revisited 11 years later in summer of 2021, with a post project completion analysis provided in the case study analysis chapters and conclusions.

Book Structure Following this introduction, the first chapter starts by exploring the most recent urban regeneration literature and continues by focussing on the property development aspect of regeneration. It then discusses the theories behind the two redevelopment models and analyses property development from an institutionalist perspective. The second chapter discusses urban development and redevelopment in developing countries and the Middle East, discussing the urban theories that stem from developing countries and focussing on the Middle Eastern cities with similar characteristics. The third chapter focuses on Iran and Tehran, explaining how the development industry operates in Tehran as well as the urban management and regeneration policies there. In the fourth and fifth chapters, the story of each case study is told with reference to the main theoretical discussions. First, the urban problems in each neighbourhood are described, and the regeneration processes within which redevelopment occurred are pointed out. Then the data that have been collected are analysed, providing empirical accounts of two urban intervention policies. The concluding chapter compares the two case studies side by side in an attempt to understand how they operated differently. The lessons learned and the main findings, together with their application to other places as well as their contribution to the urban regeneration literature, are discussed.

References Adair A et al (1999) Evaluation of investor behaviour in urban regeneration. Urban Stud 3(12):2031– 2045 Allen J et al (2004) Housing and welfare in Southern Europe. Blackwell Publishing, Oxford Carmona M (2009) The Isle of dogs: four development waves, five planning models, twelve plans, thirty five years, and a renaissance… of sorts. Prog Plann 71(2009):87–151 Cheshire P (2006) Resurgent cities, urban myth and policy hubris: what we need to know. Urban Stud 43(8):1231–1246 Dunleavy P (2003) Authoring a PhD. Palgrave Macmillan, New York, USA Guy S, Henneberry J (2000) Understanding urban development processes: integrating the economic and the social in property research. Urban Stud 37:2399–2416 Guy S et al (2002) Development cultures and urban regeneration. Urban Stud 39(7):1181–1196 Healey P, Barret S (1990) Structure and agency in land and property development process: some ideas for research. Urban Stud 27:89–104 Mukhija V (2001) Enabling slum redevelopment in Mumbai: policy paradox in practice. Hous Stud 16(6):791–806 Mukhija V (2004) The contradictions in enabling private developers of affordable housing: a cautionary case from Ahmedabad, India. Urban Stud 41(11):2231–2244 Nappi-Choulet I (2006) The role and behaviour of commercial property investors and developers in French urban regeneration: the experience of the Paris region. Urban Stud 43(9):1511–1535

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Parnell S, Robinson J (2012) (Re) theorizing cities from the global South: looking beyond neoliberalism. Urban Geogr 33:593–617 Porter L, Shaw K (Ed) (2009) Whose urban renaissance? An international comparison of urban regeneration strategies. Routledge, Abingdon Turok I (1992) Property-led urban regeneration: panacea or placebo. Environ plann A 24:361–379 Webster C, Lai L (2003) Property rights, planning and markets: managing spontaneous cities. Edward Elgar Publishing, Cheltenham, UK

Contents

1 Urban Regeneration in Run-Down Urban Areas . . . . . . . . . . . . . . . . . . 1.1 Today’s Urban Regeneration Practice . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1.1 Public Participation in Today’s Urban Regeneration . . . . . . . 1.2 The Property Development Aspect of Urban Regeneration . . . . . . . . 1.2.1 Triggering Developments in Run-Down Areas . . . . . . . . . . . 1.2.2 Developer Behaviour and Self-Provision of Housing . . . . . . 1.2.3 Urban Regeneration and the Property Markets . . . . . . . . . . . . 1.2.4 Urban Regeneration and Gentrification . . . . . . . . . . . . . . . . . . 1.3 Comprehensive Redevelopment Versus Piecemeal Redevelopment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.4 Centralised Planning Versus Spontaneous Planning . . . . . . . . . . . . . . 1.5 Institutional Development Versus Independent Development . . . . . . 1.6 Property Development from an Institutionalist Perspective . . . . . . . . 1.6.1 Social Responses of Property Actors . . . . . . . . . . . . . . . . . . . . 1.6.2 Developers’ and Planners’ Roles as Major Development Actors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.6.3 Institutions and Place Development . . . . . . . . . . . . . . . . . . . . . 1.7 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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2 Urban Development and Redevelopment in Developing Countries and the Middle East . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1 Urban Development in Developing Countries . . . . . . . . . . . . . . . . . . . 2.1.1 Urban Planning Theories from Developing Countries . . . . . . 2.1.2 Enabling Property Markets in Developing Countries . . . . . . 2.1.3 Modes of Housing Provision in Developing Countries . . . . . 2.2 The Middle Eastern Context . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3 Urban Redevelopment in Turkey . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.1 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.2 The State of Urban Redevelopment in Turkey . . . . . . . . . . . . 2.4 Urban Redevelopment in Egypt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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2.4.1 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4.2 The State of Urban Redevelopment in Egypt . . . . . . . . . . . . . 2.5 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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3 Urban Development in Iran and Tehran . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1 Urban Development in Iran . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1.1 Housing and Development Sector in Iran . . . . . . . . . . . . . . . . 3.1.2 Urban Land Policies in Iran . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2 Urban Development in Tehran . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2.1 Tehran’s Formation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2.2 Rapid Urban Expansion in Tehran . . . . . . . . . . . . . . . . . . . . . . 3.2.3 Spatial Structure of Tehran . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3 Development Industry in Tehran . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3.1 Housing Development and Rising Land Prices in Tehran . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3.2 Small-Scale Versus Large-Scale Developers in Tehran . . . . . 3.3.3 Housing Indicators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.4 Urban Management Policies in Tehran . . . . . . . . . . . . . . . . . . . . . . . . . 3.4.1 Selling Density as Tehran Municipality’s Major Urban Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.4.2 Urban Regeneration in Tehran . . . . . . . . . . . . . . . . . . . . . . . . . 3.4.3 Choosing the Case Studies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.5 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

41 41 41 44 48 48 50 52 56

4 Khoob-Bakht Comprehensive Redevelopment: Description and Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2 Urban Problems in Khoob-Bakht . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3 The Khoob-Bakht Timeline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.4 The Regeneration Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.5 Implementation of Comprehensive Redevelopment . . . . . . . . . . . . . . 4.5.1 Institutional Arrangements and the Actors Involved . . . . . . . 4.5.2 Participation in Comprehensive Redevelopment . . . . . . . . . . 4.5.3 Land Assembly . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.5.4 Social Issues in Implementation . . . . . . . . . . . . . . . . . . . . . . . . 4.6 Property Development in Comprehensive Redevelopment . . . . . . . . 4.6.1 Incentive Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.6.2 Developments That Worked in Khoob-Bakht and Problems They Faced . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.6.3 Comprehensive Redevelopment and the Property Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.7 Post-Completion Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

56 58 59 61 61 63 68 72 73 77 77 79 83 85 90 91 93 95 96 99 102 105 108 109

Contents

xix

4.8 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 4.8.1 Wider Implications of the Project . . . . . . . . . . . . . . . . . . . . . . . 115 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117 5 Malek-Ashtar Piecemeal Redevelopment: Description and Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.1 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2 Urban Problems in Malek-Ashtar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3 The Regeneration Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.4 Implementation of Piecemeal Redevelopment . . . . . . . . . . . . . . . . . . 5.4.1 Institutional Arrangements and the Actors Involved . . . . . . . 5.4.2 Participation in Piecemeal Redevelopment . . . . . . . . . . . . . . . 5.4.3 Land Assembly . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.4.4 Social Issues in Implementation . . . . . . . . . . . . . . . . . . . . . . . . 5.5 Property Development in Piecemeal Redevelopment . . . . . . . . . . . . . 5.5.1 Incentive Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.5.2 Developments That Worked in Malek-Ashtar and Problems They Faced . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.5.3 Piecemeal Redevelopment and the Property Market . . . . . . . 5.6 Post-Completion Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.7 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.7.1 Wider Implications of the Project . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Piecemeal Versus Comprehensive Redevelopment Models . . . . . . . . . . 6.1 Table of Comparison . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2 Main Findings of the Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2.1 Lessons from the Khoob-Bakht Redevelopment . . . . . . . . . . 6.2.2 Lessons from the Malek-Ashtar Redevelopment . . . . . . . . . . 6.3 Implications for Tehran and Other Similar Cities . . . . . . . . . . . . . . . . 6.4 Theoretical Discussions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.4.1 Theme 1: Ideal Types of State Intervention . . . . . . . . . . . . . . 6.4.2 Theme 2: Institutional Analysis of Property Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.4.3 Theme 3: Housing Production in Run-Down Areas of Developing Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.5 The Field of Urban Regeneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

119 119 122 129 133 134 135 136 137 138 141 142 143 144 151 151 152 155 156 164 166 168 170 172 172 174 175 176 178

List of Figures

Fig. 1.1 Fig. 2.1

Fig. 3.1 Fig. 3.2 Fig. 3.3

Fig. 3.4 Fig. 3.5

Fig. 3.6

Analytical framework (Produced by author) . . . . . . . . . . . . . . . . . The Middle Eastern countries by population (Source Drawing created by author based on population information from http://www.worldatlas.com/ accessed 1 Aug 2021, and base map from Google Maps) . . . . . . . . . . . . . . . . Historical development of Tehran, 1891–1996 (Source Bertaud [2003] with permission from the author) . . . . . . . . . . . . . Map of Tehran’s deteriorated areas (Source Tehran Master Plan [2006] with permission) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tehran’s density and land price profile based on distance from the centre (Source Bertaud [2003] with permission from the author) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Spatial distribution of land prices in Tehran, 2002 (Source Bertaud [2003] with permission from the author) . . . . . . . . . . . . . Tehran districts average population growth/decline per year between 1976 and 2016 by district (Source Map created by author with data from Iran Census Organization, National Census [2016]. Note Numbers in each district represents population growth between 1976 and 2016. Population growth of district 21 is calculated between 1986 and 2016) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tehran regions average population growth/decline per year between 1976 and 2016 by region (Source Map created by author with data from Iran Census Organization, National Census [2016]. Note Numbers in each district represents population growth between 1976 and 2016. Population growth of district 21 is calculated between 1986 and 2016) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19

30 49 51

53 54

55

55

xxi

xxii

Fig. 3.7

Fig. 3.8

Fig. 3.9 Fig. 3.10 Fig. 3.11 Fig. 3.12 Fig. 4.1

Fig. 4.2 Fig. 4.3 Fig. 4.4 Fig. 4.5

Fig. 4.6

Fig. 4.7 Fig. 4.8

Fig. 4.9 Fig. 4.10 Fig. 4.11 Fig. 4.12

List of Figures

Number of issued planning permits in Tehran from 2001 (1380) to 2019 (1398) (Source Chart created by author based on data from the Municipality of Tehran database, 2020) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Number of issued planning permits in the deteriorated areas of Tehran from 2001 (1380) to 2019 (1398) (Source Chart created by author based on data from the Municipality of Tehran database, 2020) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Navab project (Source www.mashreghnews.ir. Accessed 4 May 2012) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Location of case studies in Tehran (Source of the base map: Tehran Master Plan 2006 with permission) . . . . . . . . . . . . . Imam Ali highway proposal and Khoob-Bakht (Source Imam Ali regeneration plan 2008 with permission) . . . . . . . . . . . Newly built buildings, showing piecemeal redevelopment in Malek-Ashtar (Source Sharmand 2009 with permission) . . . . Location of Khoob-Bakht in Tehran (map of Tehran’s deteriorated areas) (Source Tehran master plan 2006 with permission) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Khoob-Bakht neighbourhood (Source Author 2010) . . . . . . . . . . Physical problems in Khoob-Bakht (Source Author 2010) . . . . . An example of the drug addiction problem in Khoob-Bakht (Source Author 2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Age diagram of Khoob-Bakht (Source Chart created by author based on data from 2006 Census of Iran Census Organisation) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The mayor of Tehran (front row, second from right) amongst Khoob-Bakht residents inaugurating the project (Source UROT website. Accessed August 17, 2011) . . . . . . . . . . The Khoob-Bakht proposal (Source UROT website accessed August 17, 2011) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Chronology of the Khoob-Bakht implementation process (Source [Google maps]. 2005: Khoob-Bakht before the start of implementation. 2007: Empty lots show the start of land assembly. 2008: More lots were assembled. 2009: Construction of new projects started) . . . . . . . Regeneration process in Khoob-Bakht (Source Chart created by author with information from Andalib 2010) . . . . . . . Partial land assemblies in Khoob-Bakht (Picture by author, 2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . New developments versus those who resisted development in Khoob-Bakht (Picture by author, 2010) . . . . . . . . . . . . . . . . . . New units delivered to previous residents of Khoob-Bakht (Picture by author, 2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

63

63 65 69 70 72

78 79 80 81

83

84 84

86 86 88 89 90

List of Figures

Fig. 4.13 Fig. 4.14 Fig. 4.15 Fig. 4.16

Fig. 4.17

Fig. 4.18 Fig. 4.19

Fig. 4.20 Fig. 4.21 Fig. 4.22 Fig. 5.1 Fig. 5.2 Fig. 5.3 Fig. 5.4 Fig. 5.5 Fig. 5.6 Fig. 5.7 Fig. 5.8

Demolitions for land assembly in Khoob-Bakht (Picture by author, 2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Old versus new housing in Khoob-Bakht (Source Author 2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . One of the Nosazan projects in Khoob-Bakht (Source Author 2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Developer A project: Developer A was one of the first developers in Khoob-Bakht. He developed a lot that was assembled by the UROT from sixteen smaller lots. After the lot was delivered to him, the project took two years to complete, as it experienced some interruptions due to late payments by the UROT (Source Author 2010) . . . . . . Developer B Project: Developer B developed two projects in Khoob-Bakht, a 1,340 square metre residential project with fourteen residential units, and a 2,800 square metre mixed-use project with twenty-four residential units and eight commercial units. Each project took approximately a year and a half to complete (Source Author 2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . One of the new projects in Khoob-Bakht (Source Author 2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Khoob-Bakht redeveloped lots drawing in 2021 (Source Drawing created by author, base map from Google Maps 2021) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . New residential projects in Khoob-Bakht in 2021 (Source Author 2021) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Khoob-Bakht empty lots drawing in 2021 (Source Drawing created by author, base map from Google Maps 2021) . . . . . . . . Empty lots in Khoob-Bakht in 2021 (Source Author 2021) . . . . . Location of Malek-Ashtar in Tehran (Source Tehran master plan 2006 with permission) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . New developments in Malek-Ashlar (Source Author 2010) . . . . Land use plan of Malek-Ashtar (Source Sharmand 2009 with permission) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deterioration map of Malek-Ashtar (Source Sharmand 2009 with permission) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Dilapidated buildings in Malek-Ashtar (Source Author 2010) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3D model of Malek-Ashtar neighbourhood (Source Sharmand 2009 with permission) . . . . . . . . . . . . . . . . . . . . . . . . . . Age diagram of Malek-Ashtar (Source Chart created by author from census 2006, Iran Census Organisation) . . . . . . . Residence duration in Malek-Ashtar (Source Iranian Census Organisation 2006) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

xxiii

95 98 100

101

102 104

110 111 112 113 120 121 121 123 124 125 125 126

xxiv

Fig. 5.9

Fig. 5.10

Fig. 5.11

Fig. 5.12

Fig. 5.13

Fig. 5.14

Fig. 5.15

Fig. 5.16 Fig. 5.17 Fig. 5.18 Fig. 5.19

Fig. 5.20 Fig. 5.21 Fig. 5.22 Fig. 5.23 Fig. 5.24 Fig. 6.1

List of Figures

Reasons for living in Malek-Ashtar (Chart created by author. Data source Sharmand survey 2009 with permission) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Residents’ reasons for dissatisfaction in Malek-Ashtar (Chart created by author. Data source Sharmand 2009 survey with permission) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Narrow road structure in Malek-Ashtar with a power delivery structure in the middle of the road and a lack of a proper surface water drainage system with household wastewater from one of the dwellings pouring into the alleyway (Source Author 2010) . . . . . . . . . . . . . . . . . . . . Malek-Ashtar development chronology. 2004: Malek-Ashtar before redevelopments started to take place; 2005–2009: gradual increase of density, with more four-storey buildings replacing one-storey buildings (Source Google maps) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Newly built buildings in red, illustrating piecemeal redevelopments in Malek-Ashtar (Source Sharmand 2009 with permission) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Number of planning permits issued between 2001 and 2008 (1380–1387) in Malek-Ashtar (Source Chart created by author based on data from Urban Regeneration Organisation of Tehran 2012) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Number of planning permits in Tehran from 2001 to 2011 (1380–1390) (Source Chart created by author based on data from Urban Regeneration Organisation of Tehran 2012) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . New developments in Malek-Ashtar (Source Author 2010) . . . . New developments in Malek-Ashtar (Source Author 2010) . . . . Quality of life in the Malek-Ashtar neighbourhood (Source Rafeian et al. 2013 with permission from the author) . . . . . . . . . . Malek-Ashtar redeveloped lots drawing in 2021 (Source Drawing created by author, base map from Google Maps 2021) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . New developments in Malek- Ashtar by maintaining the existing fabric (Source Author 2021) . . . . . . . . . . . . . . . . . . . . Whole redeveloped blocks surrounding a winding road structure (Source Author 2021) . . . . . . . . . . . . . . . . . . . . . . . . . . . Malek-Ashtar neighbourhood liveliness (Source Author 2021) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Wastewater drainage problems (Source Author 2021) . . . . . . . . . Lack of parking space as a major infrastructure problem (Source Author 2021) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Modes of planning (Adapted from Carmona 2009; Copyright Elsevier 2009) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

127

128

129

130

131

131

132 139 140 140

145 146 147 148 149 150 172

List of Tables

Table 1.1 Table 3.1 Table 3.2 Table 3.3 Table 3.4

Models of urban development: ideal types (Guy et al. 2002, p. 1191, Copyright Sage Publishing 2002) . . . . . . . . . . . . . Agencies responsible for urban development in Iran . . . . . . . . . . Population increase in the Tehran (National Census 2016) . . . . . Housing domain quality of life indicators for national urban areas in 2006 and 2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Number of planning permits issued between 2001 and 2010 (1380 and mid-1389) in deteriorated areas by district . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

12 45 50 60

71

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Chapter 1

Urban Regeneration in Run-Down Urban Areas

Abstract The first chapter, in reviewing urban regeneration literature attempts to address two problems. First, the existing developing world urban regeneration literature, due to the relatively recent adoption of these policies, did not cover the range of issues that is analysed in this research. As such, taking into consideration the context of the developing world cases, this chapter derives many references from the wealth of research on regeneration, drawing on its analytical and argumentative contributions. Second, there was no specific theoretical fit for the range of issues that this research aimed to investigate to answer the main research question: “How do piecemeal and comprehensive redevelopment models operate in the run-down neighbourhoods of Tehran?” As such, the underlying theoretical elements of each redevelopment model are discussed, with a direct versus indirect planning dichotomy serving as the weaving element that connects the various segments. A special emphasis is placed on the implementation aspects of regeneration, since in Tehran the implementation of regeneration had been unsuccessful. In doing so, the property development aspect as a driving aspect for implementing a redevelopment project is analysed, discussing different elements of implementation ranging from triggering developments in underinvested areas to development problems in run-down areas as well as the social issues related to the development process. Keywords Urban redevelopment · Property-led urban regeneration · Developer behaviour · Centralised planning · Spontaneous planning · Housing self-provision · Institutional economics

1.1 Today’s Urban Regeneration Practice Similar to many other urban planning terms, regeneration is a term borrowed from biology, where it is defined as “the re-growth of lost or injured tissue, or the restoration of a system to its initial state” (Couch et al. 2003, p. 2). There are numerous definitions of urban regeneration in the urban planning literature. The following two definitions are mainly used in this research.

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2022 K. Soltani, Redeveloping Tehran, The Urban Book Series, https://doi.org/10.1007/978-3-030-97091-8_1

1

2

1 Urban Regeneration in Run-Down Urban Areas

“Comprehensive and integrated vision and action that leads to the resolution of urban problems and which seeks to bring about a lasting improvement in the economic, physical, social and environmental condition of an area that has been, or is, subject to change” as defined by Robert and Sykes (2000). As well as “the process of reversing economic, social and physical decay having reached the point where market forces alone will not suffice” as defined by Adair et al. (1999). The above definitions outline the aims of urban regeneration, while in practice urban regeneration projects aimed towards these goals of achieving comprehensive “resolution of the urban problems” or “reversing economic, social and physical decay” as described by Robert and Sykes and Adair et al., respectively, are far-fetched in many cases. As Porter and Shaw (2009) remind us, “urban and regional development is not a smooth process towards an imaginary equilibrium state. Instead . . . it lurches forward from imbalance to imbalance, as different pressure points become activated, forcing an adjustment in policies and budgetary allocations.” Urban regeneration has evolved from urban reconstruction practices, involving extensive clearance and rehousing in suburban housing estates, as well as city centre redevelopments, to a more socially sensitive practice of today. The aim of today’s urban regeneration, in theory and practice, is to tackle the problems that exist in urban areas. Recognising that physical regeneration is only one aspect of the regeneration process, today’s urban regeneration practices treat social and economic regeneration as other interrelated aspects of this process. In postwar Europe, although many regeneration projects were centred around housing estates and industrial sites, in more recent years a shift has happened from traditional industrial and commercial projects, and more emphasis has been placed on local community issues. Most of the Western European cities, especially the UK, after the Second World War tackled the problem of housing obsolescence with slum clearance and replacement, usually with “thought to be cheap high-rise estates” (Couch et al. 2003). Since the late 1960s, after realising the value of the older stock and that there is more than just a housing problem and also recognising the importance of social issues, urban regeneration practices have moved towards more sensitive approaches and area improvements. Nevertheless, comprehensive redevelopment approach to urban regeneration is still prevalent in many eastern European and Russian cities including Moscow and St. Petersburg. In 2017 Russian government launched a program to demolition and rebuild pre-fab five-storey buildings that were mass produced in the 1950s and long outlived their shelf life, affecting approximately 1.6 million people (Neducin et al. 2021). The aim of different urban regeneration examples varied to a great degree with the turn of the century. Return of land and derelict buildings to profitable uses, employment creation through inward investment and indigenous growth, social inclusion, environmental improvement, competition between cities in order to improve their perceived image, and cultural developments by using annual festivals in order to create unique city characters are some of the aims of these regeneration projects (Couch et al. 2003). Following the financial crisis of 2008, and the withdrawal of states from public projects, new modes of urban governance in the context of austerity urban planning

1.1 Today’s Urban Regeneration Practice

3

are taking shape. Urban transformations are increasingly driven by interventions with a minimal physical effect that have major consequences. This approach requires urban policies that focus on the “soft” urban regeneration policies, which can have no less impact than “hard” policies. However, as these new processes of place-making increasingly require participation of local communities and bottom-up initiatives, the so called “soft” public policies can have contradictory output in regulating spontaneous initiatives by limiting their freedom and scope. As such, devising these soft urban policies should be carefully curated and consistently revised (Rabbiosi et al. 2021). The global trends that effect the built environment and strategies for regeneration require a revision to the governance model in urban regeneration. There is a pressing need for the public sector to coordinate and delegate wherever possible the process of transformation to the private sector. The role of the private sector can be even more pivotal in alternative development models compared to the traditional ones that are needed more than ever for urban regeneration (Ciaramella and Dall’Orso 2021). As far as the scale of regeneration is concerned, whether to treat urban decay and regeneration as a local or a wider regional issue is extensively debated. Many observers believe that the solution to urban decline should be sought in external factors, and as such they have argued for an outward-looking approach, criticising urban regeneration policies as inward looking (see Carter 2000). Many authors argue that change should also facilitate further change in other areas and sectors, and that it should create dynamism and spillovers to other parts of the city. They argue that urban regeneration projects are more effective once linked to citywide development plans. This connection between the local and citywide development plans, they believe, avoids the repetition of the mistakes of the 1980s property-led regeneration in Europe, where the benefits of the regeneration projects failed to spill out to surrounding areas (Carter 2000; Colantonio and Dixon 2011). The influential Urban Task Force (1999) report in the UK, which was commissioned to provide recommendations for an urban renaissance in the wake of urban decay in many UK cities, highlights the need for designation of “urban priority areas” in urban regeneration. These areas are described as the areas with a mix of economic need and concealed market potential, within which the area regeneration should take place, by integrating physical aspects of regeneration with social and economic objectives.

1.1.1 Public Participation in Today’s Urban Regeneration As far as public participation is concerned, bottom-up approaches within social and community regeneration, rather than top-down approaches, are clearly favoured in the academic literature. Given that it is the residents who shape areas within cities, regeneration schemes need to respect their needs. Further, residents have greater insight into their own neighbourhoods, often about issues that outsiders can overlook. The Urban Task Force (1999) report argued for the importance of public participation in regeneration projects. The report highlighted that run-down areas are often inevitably

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1 Urban Regeneration in Run-Down Urban Areas

occupied by people with the fewest choices and the lowest incomes. As such, the report argued that these projects should be targeted for and benefit people in places rather than just the places themselves. The long history of urban regeneration policies in the UK with top-down interventions in the 1960s and 1970s has led to a widespread perception that top-down projects often fail. It has been realised that top-down decisions are inevitably flawed, as public-sector planners, no matter how well intentioned, seek to obtain all the knowledge necessary to second-guess the aspirations of thousands of people. Consequently, public participation has become central to the urban regeneration process in the UK, with an established tradition of community participation. The rise of bottom-up urban regeneration movements has increased since the economic crisis of 2008 and its following austerity measures, especially in countries with weaker welfare states. These practices can be categorised as soft urban regeneration as they transform run-down areas with the direct involvement of residents without the usual top-down governance of the state, and have given rise to the emergence of new urban policy measures. These bottom-up initiatives seek both collaboration with the state and autonomy at the same time (Pradel-Miquel 2021; Bottero et al. 2020). Even the Chinese planning system with its history of top-down and strong government-dominated ideology has been experiencing a paradigm shift towards more participative decision-making planning. The top-down approach has faced deadlock when consensus in neighbourhood cannot be reached. In order to create successful places, the governance of places needs to engage plural stakeholders and turns this into an advantage. This community involvement incorporates place-based local knowledge into strategic solutions where problems are hard to resolve from the outside. As such, In order to achieve a more sustainable urban regeneration approach, the combined effort of the private and public sectors with their shared resources and interests are required (Chen and Qu 2020). This long history and tradition does not exist in the Iranian context. In the last decade, the Municipality of Tehran as the main institutional stakeholder in regeneration has adopted a more participatory approach. This process of community involvement is a departure from the previous top-down and technocratic approach, which can be seen as a changing democratic culture in urban redevelopment in the country. The overall approach has received criticism, as tenants are generally excluded, and there are inequalities amongst participants for example between earlier and later participants in their access to resources. The inconsistency and intermittence in the participation approach have also affected the quality of the whole participation process (Erfani and Roe 2020).

1.2 The Property Development Aspect of Urban Regeneration

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1.2 The Property Development Aspect of Urban Regeneration The historical inability of state-led interventions to provide solutions to many regeneration problems and the fiscal crisis of welfare states have led to the increasing presence of market-friendly schools of thought. Highlighting the need for regeneration projects to yield positive returns on investment, the Urban Task Force report (1999) argues that urban visions can risk remaining just on the draughtsman’s board as impressive concepts unless private-sector developers are involved in these projects. In the UK, the government realised that bringing the private sector into complex public projects can have numerous benefits, including introduction of innovative methods for delivering public services, increased efficiency, and improved management of risks involved in complex investment projects in order to complete them on time and on budget (Wilkinson and Reed 2008). Further, the extent of areas requiring regeneration with their significant associated costs have made the need to attract private investment inevitable (MacLaran 2003; Nappi-Choulet 2006). As such, over the later years of the twentieth century, the role of urban planning transformed from a traditionally restrictive role to a more facilitative one towards the private sector, formulating holistic development strategies and acting as a catalyst and enabling authority (MacLaran 2003). The role of private sector in urban regeneration has increased globally, even in strong state controlled and welfare economies like China. In Chinese inner cities there has been a major shift from stateled to market-oriented approach, and property-led urban developments are a critical part of the state’s urban regeneration strategy (Liu et al. 2019). As such, there has been a global shift in urban planning from policy-driven to a more opportunity-driven approach. Entrepreneurial governance has specially taken place in urban regeneration projects with an increased involvement of private-sector and property-led developments. This trend corresponds to a paradigm shift in deregulation of state and privatisation of public projects. As such, contractual agreements between public and private agents have played a more significant role than public policy in regenerating derelict areas (Tasan-Kok and Van der Hurk 2020). The Public Private Partnerships (PPP) form of governance as a neoliberal policy was a response to municipal fiscal constraints, lack of confidence in bureaucratic administration and an antidote to top-down urban planning. This form of governance valorized private-sector capacity and creativity for community entrepreneurialism (Schaller 2021). As at the time of overstretched public budgets cities face increasing demand for investment in public goods, novel approaches to financing and managing urban redevelopment are tried in cities across the world. While the PPPs focussed on single projects later models deployed the gains from one project to other public projects. The Copenhagen City and Port Development Corporation came up with a hybrid model known as Public Asset Corporation or PAC that leveraged public assets through land value capture and Public-Private Partnerships without using scarce tax revenues. This model tries to avoid operational inefficiencies of public management while utilising the revenue maximising mechanisms of private corporations. As this

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model does not rely on scarce tax funding it removes hard prioritisation to whether invest in road upgrades or public facilities. The PAC experience represents an innovative institutional model that is needed to invest in upgrading cities, and is being adapted to other European and US cities (Noring 2019).

1.2.1 Triggering Developments in Run-Down Areas Developers are very sensitive towards the locational factors of the area within which they plan to invest so they can attract sufficient demand from the surrounding areas. For example, for retail developments, developers pay special attention to the spending capacity of the local population, or for new office developments to the local job creation potential of the local economy (Wilkinson and Reed 2008). Adams et al. (2012) go further by highlighting that the old adage of “location, location, location” in selecting property development projects is now taking into account broader issues and is replaced by “location, product, and timing.” In the context of run-down areas, geographical factors and local economic contexts are not always favourable. Inner-city regeneration, in comparison to other types of property developments—for example, a single pre-let office block to a major corporation—poses a significant risk to developers. This risk can be attributed to a number of factors, such as the lengthy period of land assembly in central parts of cities, where fragmented ownership can result in delaying construction start, negatively impacting project profitability (Wilkinson and Reed 2008). Further, the weak economic base, obsolete premises, poor-quality sites, and lack of infrastructure in inner-city regeneration projects all discourage private-sector involvement (Adair et al. 1999). Another major problem is that people are reluctant to trigger change in run-down areas. Although individuals might be interested in modernising their property, opportunities are lost, as they are dependent on collective confidence. This can result in neighbourhoods becoming deteriorated further, highlighting that development activities need to be triggered (Adams 2001). As such, governments need to find ways of easing the investment process. There is a need for tax cuts and incentives as well as sufficient demand and good quality supply. Government incentives have had meaningful effect on the regeneration of distressed urban cores. These incentives for urban regeneration especially in the form of tex credits grew in the US cities following the fiscal crises of the late 1970s and the 2008 global financial crisis (Tapp 2019). As incentives alone are not sufficient, there needs to be enough demand for the product that will be offered. Nevertheless, in high inflation economies like Iran, property development is one of the more secure modes of investment. This is mainly because the property values usually grow with inflation, and property as an asset has characteristics that make it a hedge against inflation. This is in contrast to other economic activities, for example, manufacturing. Therefore, property investment has proved to have “inflation-proof” returns (MacLaran 2003).

1.2 The Property Development Aspect of Urban Regeneration

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1.2.2 Developer Behaviour and Self-Provision of Housing As outlined above, urban regeneration projects are generally perceived as highrisk/low-return investments, discouraging many investors from participating in these initiatives. Therefore, it is crucial to better understand developer’s decision-making criteria as well as their perception of urban regeneration projects. In order to have a framework to analyse developer behaviour in regeneration projects, two of main pieces of research in analysing developers’ decision-making in regeneration projects, from Adair et al. (1999) and Nappi-Choulet (2006), were utilised. Adair et al. (1999) used the following hypotheses in order to assess investors’ behaviour in urban regeneration projects in the UK. First, urban regeneration projects are perceived by the private sector as high-risk/low-return investments. Second, the limited availability of other property development investment drives private investors towards these projects. Third, investors seek higher returns from regeneration projects in comparison to other non-regeneration investment opportunities. Nappi-Choulet (2006) analysed the drivers of commercial property development in urban regeneration and the determinants of private-sector decisions, examining risk, investment time horizon, expected rate of return for investments, and the timing of investment regarding the property cycle. On the other hand, in places where the development industry is not as established as the western European countries, the role of self-provision in housing production is notable. In southern European countries, for example, the role of the state in housing provision is less significant, with families playing a more significant role in providing housing for their members. In these cases, families provide their resources, including land, finance, labour, and social connections, to provide property for their members. Being adapted to the urban conditions, this method of self-provision has its roots in the rural tradition of self-building as well as familial and neighbourhood social structures (Allen et al. 2004). Further, in the absence of credit systems and insufficient mortgage provision, people usually use their savings as working capital, and sometimes due to lack of resources building works stop, only to resume once more funds become available. Until the late 1980s, most of the housing production in southern European countries, except Spain, was characterised by small-scale production of housing, especially where the size of urban land is small. This small-scale production is associated with “small construction firms, a weak urban planning system, relatively easy access to small plots of land and a weak credit system for both purchase and building” (Allen et al. 2004). These countries certainly include Iran, where many of the abovementioned characteristics are present, including the underdeveloped credit system for housing production and the way in which families use their own resources to replace that. Further, the presence of fragmented land ownership structures and small construction firms are other similar features.

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1.2.3 Urban Regeneration and the Property Markets Market conditions can significantly affect the process of regeneration. Wellperforming markets in the highest-quality urban areas attract further developments towards areas that are already well developed, while areas in need of renewal are further neglected (MacLaran 2003). Further, the market cycles result in overproduction of built space at the height of a development cycle and underproduction in the following years (Adams 2001). Edwards considers land and property markets to be significantly boom prone and crisis prone, being affected by much greater fluctuation than the rest of the economy (Edwards 1990). Market downturns can adversely affect redevelopment projects. The most recent economic recession of 2008 was a clear example of this trend. However, even prior to the 2008 downturn there had been examples of regeneration projects being affected by recessions. For example, during the market downturn of the late 1980s and the early 1990s, many regeneration projects suffered from placing too much emphasis on property development, including Urban Development Corporations (UDCs) in Bristol and Leeds (Deas et al. 2000). Colantonio and Dixon (2011), when assessing the changes in the regeneration industry after the economic recession of 2008, highlight the need for cities to explore innovative ways of financing regeneration through joint ventures between the public and private sector. In their article titled “Organic Regeneration and Sustainability, or Can the Credit Crunch Save Our Cities?” Evans et al. (2009) state that recession has proved that a more organic model of urban regeneration based on bottom-up models should replace the private-sector-led commodity-based model, which, for them, has frequently failed to deliver social sustainability.

1.2.4 Urban Regeneration and Gentrification The theory of property-led urban regeneration in the neighbourhood context is that investments can have positive externalities, improving a neighbourhood’s image and perception. This can encourage people to stay, maintain, and improve their properties, while attracting others to the area. Turok (1992), in one of the pioneering research papers in this regard, titled “Property-Led Urban Regeneration: Panacea or Placebo?” argued that while property development can create a platform for holistic regeneration, it is not sufficient on its own, and its significance should not be overstated. As such, there is a need for a balance between the “investive” and “non-investive” measures of regeneration (Colantonio and Dixon 2011). Gentrification was initially coined by the British sociologist Ruth Glass in the mid-1960s to describe transformations in the inner-city of London, took off in the Global South from the 1980s. In the West, gentrification has been synonymous with class replacement in inner-city neighbourhoods (Zhan 2021). One of the main criticisms that property-led regeneration receives is the potential increase in land values.

1.2 The Property Development Aspect of Urban Regeneration

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This issue can be viewed in two different ways. If urban regeneration succeeds in its objective of increasing the quality of a neighbourhood, then this can result in more demand for the area and consequently higher property prices. This can be beneficial for the owners and attract new residents and businesses to the area. However, it can put pressure on residents living in rented accommodations as well as businesses that offer cheaper products and the low-income residents who rely on them. In China where gentrification started since the land market reforms of the 1980s, has taken a shift and is no longer driven by capital, rather is driven by the demands of the young urban professionals. Zhan (2021) calls this shift “fluid gentrification” whereby gentrification is understood as a collection of urban policies, market demands, and multiple actors behaviour. Increased rent in regeneration areas has been addressed in some projects by cross-subsidising housing for low-income residents with the profits generated from urban redevelopment projects in the area. Colomb (2009) mentions an example of this strategy in East London’s Coin Street, where they managed to cross-subsidise affordable housing from the profits generated from commercial leases on the riverfront. In this case, the instrumental issue was trying to cross-subsidise community-oriented activities on the back of increasing land values. Porter and Shaw (2009) suggest that incremental regeneration approaches that accommodate reinvestment beyond solely the fiscal aspect can work better in the interest of regeneration. They raise the need for research in alternative ways to “comprehensive redevelopment through land assembly” and outlining alternatives “to the variability of grounded impacts in a wider variety of settings” (Porter and Shaw 2009). Urban regeneration projects in Iran have not taken the gentrification aspects of their actions into account. With the emphasis on the physical aspects of regeneration, the social and economic consequences of regeneration received little attention. Massoud et al. (2019) in their study demonstrate that neighbourhoods that underwent regeneration in Tehran experienced gentrification to varying degrees. They also highlight a more severe gentrification where regeneration activities and private-sector investment were more widespread. As discussed above, the negative impacts of private-sector-led intervention and the resultant gentrification can be reduced with the help of public provisions in regeneration projects. A benevolent regulatory role of the state in hampering the affects of urban regeneration is required as a productive city needs to be inclusive of all social classes (Zhan 2021). Gentrification ideas underscore that residents of the subject areas should not be marginalised, and their needs should be prioritised.

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1.3 Comprehensive Redevelopment Versus Piecemeal Redevelopment The overarching theme of this research is analysing the dichotomy between direct and indirect planning, within which comprehensive versus piecemeal redevelopment is studied. This section looks at some of the underlying theories that explore similar contrasting concepts in urban planning and regeneration.

1.4 Centralised Planning Versus Spontaneous Planning Neoliberalism is often associated with the withdrawal of state from planning, while its main motto is minimum government and maximum governance, its scholars promote participatory decentralisation in a network-oriented approach to empowerment. This approach is considered less authoritative and interventionist (Choudhary and Das 2020). Nevertheless, authors such as Harvey (2008) point out that private property and profit overrules any other right in neoliberal approach to urban regeneration, resulting in exclusive enclaves and dismissing the urban poor. Webster and Lai (2003) are advocates of “constrained spontaneity” as they put it. Highlighting that the main issue is not the one of market versus planning; rather, it is between imposed and centralised coordination versus spontaneous and decentralised coordination. They define spontaneity as, first, the ability of markets to respond to changes in supply and demand without central planning; for example, when a private development scheme combines small plots of land. Second, as the ability of political markets to respond to changes in voters’ demands; by this they mean in liberal democracies. This is comparable to market spontaneity. Further, spontaneous markets require spontaneous governments that will provide a legal environment for innovation, competition, and private wealth accumulation. They mention that the failure of governments to provide required infrastructure, especially in developing countries, has changed their role from suppliers to enablers of investment and facilitators of market behaviour. This is driven more by poverty than by libertarian arguments. Another aspect of government failure is in imposing planned order. This is due to the complex rules and costly information requirements of these policies. There is also the danger of opportunistic behaviour by experts and decision makers, as they have a monopoly over centralised information. They further highlight that in many cases where planned order was implemented in cities, much of it had to be revised by market behaviour. Nevertheless, there are some orders that could only be implemented by the governments, and governments owe their existence to them in the first place. Protection of private property, personal liberty, and security are among these actions. These state actions succeed when they help spontaneous actions and order to flourish while at the same time placing broadly accepted constraints on private actions. Some examples

1.4 Centralised Planning Versus Spontaneous Planning

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include the provision of infrastructure as well as protection of property rights and private benefits. The institution of private property, a set of rules that govern competition, has two major benefits. First, it turns anarchy into a state of affairs that makes wealth accumulation in society possible. Second, it protects individual liberty. The authors insist, “Human drive to be fruitful is a reliable device for those vested with responsibility of governing society towards greater prosperity” (Webster and Lai 2003). One classical example is the social housing production of the postwar years in Western Europe, which led to even greater social reengineering of slum clearance. The failure of social housing policies in these cases demonstrates that politicians and planners lack information with regard to user demands and shows their inability to supply and manage housing. The realignment of private property rights, in this case, led to a diversification of uses and tastes in response to demands (ibid.). Authors like Cheshire consider property rights as significant city inertia. He reviews plans to rebuild parts of cities like London (after the fire of 1666), Chicago, Berlin, and Tokyo, where there were plans to rebuild them with a more efficient layout, while ownership of land did not allow those utopian visions to materialise (Cheshire 2006). The major argument against free trade and spontaneously ordered cities are weak consumers, externality costs, and sustainability issues. The need for governmentsubsidised housing and support for weak local industries that cannot enter the market are some examples of these situations. Externality or third-party costs can include the destructive effects of some land uses on the other adjacent activities. Sustainability issues, especially environmental impacts, are examples of these externalities (Webster and Lai 2003). As such, authors like Adams and Tiesdell (2010) highlight that there is a strong rationale within welfare economics for state intervention to offset market externalities and market failures. The dichotomy of formal and informal planning is mutually constitutive. Eizenberg (2019) argues that pure forms of formal and informal planning do not exists, she suggests the relation between formal and informal, or top-down and bottom-up planning is more overlapping and inseparable as commonly understood in the field of planning. The definition of informality should move on from illegal slum developments to alternative contemporary forms of spontaneous urban development. At the same time top-down planning should not be dismissed as manipulative and cynical. As such a relation of co-production of agency and power between the two forms needs to be established. Eizenberg (2019) outlines three forms of self-organisation to unravel the overlapping relation between top-down and bottom-up planing. First self-organisation by the deprived citizens for basic rights, second by the ordinary citizens for community interest, and third by the powerful for economic gains. These categories try to withdraw the mere good or bad labels on these contrasting forms of planning and allow an analysis on the pros and cons of each model. She proposes an integrated framework at the interplay of institutionalised aspects of central planning together with the ad-hoc aspects of self organisation, which is also the focus of this research.

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1.5 Institutional Development Versus Independent Development The two development models that this research investigates each involve a unique development culture. One of the few research projects that has studied the differences between development cultures, with specific reference to urban regeneration, is the work of Guy et al. (2002). The specific contexts within which they studied their cases are very unique; however, their analytical model, based on the dichotomy between institutional and independent development cultures, informs the analytical structure of piecemeal versus comprehensive developments of this research. In Table 1.1, they demonstrate two different models of urban development. They state that “independent investors appear to recognise the links between social complexity and urban vitality which is central to regeneration processes” (Guy et al. 2002). Further, independent developers introduce new pathways to urban regeneration, which are not visible to institutions. As proposals for institutional investments need to be assessed based on previous experiences, new and unique proposals do not pass this test. As such, individual developers offer fresh and unique approaches and collaborative initiatives in their behaviour, compared to the standard approach of institutional developers who avoid novel approaches (Adams et al. 2012). Further, a study of investors’ behaviour in six midsize European cities shows that small local investors have the advantage of inner knowledge. The knowledge of the local market, as well as good contacts with the local authorities, assists them in pioneering investments, while at the same time can yield them greater profits (Nappi-Choulet 2006). Table 1.1 Models of urban development: ideal types (Guy et al. 2002, p. 1191, Copyright Sage Publishing 2002)

Feature

Institutional

Independent

Location

Core

Fringe

Size

Large

Small/Medium

Tenancy

Single

Multiple

Use

Fixed

Mixed

Lease

Rigid

Flexible

Image

Universal

Vernacular

Design

Blind

Sensitive

Knowledge

National/global

Local/regional

Risk

Averse

Positive

Vision

Retrospective

Future

Profession

Insiders

Outsiders

Value

Economic

Socioeconomic

1.6 Property Development from an Institutionalist Perspective

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1.6 Property Development from an Institutionalist Perspective There are four main traditions in studying developer behaviour, namely: mainstream economics, power/behavioural approaches, structure-agency institutionalism, and structure of provision theories (Adams et al. 2012). This research utilises structureagency institutionalism in order to analyse developer behaviour. Institutional analysis enhances our understanding of the development process by discussing the ways in which actors behave in relation to the broader strategies in the development process as well as actors’ behaviour towards regulatory and socioeconomic frameworks. Healey and Barret (1990), in an influential article, proposed an approach that combines analysis of structure and agency by focussing on resources, rules, and values that actors utilise. The problem that Healey and Barret (1990) try to address in their work is that they believe many mainstream economists treat the transformation of economic processes into land use change and development as unproblematic. These mainstream economics hypotheses, based on the neoclassical model of the market, assume that demand translates into supply, with various actors in the development process working collectively to make it happen. Healey and Barret argue that empirical research on urban development processes has demonstrated that the relation between demand and supply is a problematic one in many ways. In order to mediate the demand-to-supply transformation in urban development, there is an array of intermediaries in place from the state to various organisations representing the development industry. Further, the interplay of various agents in the negotiation of development projects, wider economic contexts, planning regulations, and social behaviours are all part of this transformation. Healey and Barret highlight different forms of landownership, organisation of agents and intermediaries, as well as the flows of finance as significant distortions in the demand-supply transformation. Healy and Barret’s work on institutional economics has been noticed by many economists, and neoclassical economics is no longer based on assumptions such as perfect competition, full information, and instant equilibrium (Adams and Tiesdell 2010). As such, Healey and Barret (1990) argue for an understanding of the relation between structure and agency in the development process. By structure they mean what drives the development process and creates specific patterns, and by the agency they mean the way in which individual agents develop and pursue their objectives. In other words, structure is the framework within which agents make their decisions. Within this context they call for research emphasis on the following: (a) (b)

“the resources for development, as channelled via the financial system and the interrelation of supply and demand; the politico-juridical rules which limit the construction of development opportunities; and

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the ideas and values people hold about what they should build, what they would like to occupy and what kind of environment they seek” (Healey and Barret 1990, p. 94).

Healey later in 1991 utilised her analytical framework outlined above in researching the interrelation between urban regeneration and the development industry. In this paper, Healey analysed the agency and actor relationships in the negotiation of development projects. Healey and Barret (1990) introduced four themes for future research based on the framework that they proposed. The first theme is with regard to the relation between the financial system and investment in property development; the second is to assess how the resources and the rules of economic organisation shape the strategies of firms involved in property development; the third is to evaluate the way the state structures property development processes through its constitution of rules and resources; and the fourth is to assess the outcomes of these processes. They elaborate on the third theme that they proposed as follows: Various ways in which the state impinges on these changing practices, in relation to the tools of intervention employed (forms of financial subsidy and taxation, forms of land dealing), the way in which these affect the demand for space, the rules within which individual firms develop their strategies, and the forms of development processes. (Healey and Barret 1990, p. 98)

This research builds on the third theme outlined above and explores two different state policies in structuring property development processes. While Healey’s institutional framework has significantly contributed to enhancing urban development research, it has also received some criticism. For example, Guy and Henneberry (2000), while acknowledging the benefits of institutional perspective and utilising this framework in their research, criticise the work of Healey and Barret (1990) in that they draw a tenuous link between development dynamics and the broader economic structures. Guy and Henneberry believe that Healey in her analysis emphasises the social over the economic issues, the local over the regional, and agency over structure. The following section discusses Guy and Henneberry’s approach in further detail.

1.6.1 Social Responses of Property Actors Guy and Henneberry’s (2000) work builds on institutionalist approaches, focusing on social and economic analyses of property development processes. They focus on the question of “how” to analyse institutions in urban development processes and conclude their paper by arguing for the following: the need to develop an understanding of property development processes which combines a sensitivity to the economic and social framing of development strategies with a fine-grain treatment of the locally contingent social responses of property actors. (Guy and Henneberry 2000, p. 2399)

1.6 Property Development from an Institutionalist Perspective

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Guy and Henneberry (2000) describe the institutional analysis as a methodological approach in unravelling the ways in which property actors perceive the development process and their subsequent actions. In doing so, the institutional analysis departs from mainstream economics and positivist approaches, which idealise and isolate economic structures and individual behaviours. Ball (1998) raises concerns with regard to the institutional analysis that downplays the processes of economic structures in favour of agency-oriented perspectives, as he maintains a clear distinction between social and economic perspectives. For example, when analysing the British urban regeneration projects, Ball suggests that the outcomes of the projects can be attributed more to the stage of the property cycle rather than to the regeneration policies themselves. Guy and Henneberry argue that social and economic structures cannot be easily separated. They give the example of risk weighting in investment decisions. Ball attributes risk weighting to economic structures, but Guy and Henneberry argue that risk weighting, as opposed to an objective science, can be the agency of risk analysts. For example, in the case of the familiarity of the risk analyst with a certain locality, that locality can receive irrationally better risk ratings compared to other regions (see Guy and Henneberry 2000). As such, Guy and Henneberry argue for a perspective that sees the economic and social as two interrelated and linked aspects of urban change. Further, in studying developer and investor behaviour, they found that decisions that are described as irrational from a purely economic perspective could be understood by taking into account a social perspective. For example, investment decisions in a specific market can be based on appropriate minimum lot size, acceptable market liquidity, and acceptable status of property occupiers, which are not criteria that are only technically determined. This understanding is based on the experience of the property actors in the specific market. Guy and Henneberry’s research also analysed cases where actions from a small number of portfolio managers based in London affected the property prices in a variety of regions. As such, they conclude that developers’ and investors’ behaviour and decision-making (as a social behaviour) can have significant impacts on development cycles. Others, like Adams and Tiesdell (2010), also highlight how the behavioural characteristics of developers affect development decisions and outcomes, causing economic decisions to deviate from rational calculations, which has been studied at length in behavioural economics. As such, they argue that land and property markets are socially constructed, through a system of social relations within which the built environment is produced. In this respect they underscore market complexity and sensitivity to context, and their dependence on the objectives of development actors. As such, they highlight how different localities can experience different market construction, with distinctive procedure, relations, social culture, and various institutions that condition the markets. In a later paper in 2012, Adams et al., in advocating institutional approaches, argue that econometric tradition, while providing useful quantitative insights, places too much emphasis on macroeconomic forces, leaving behavioural elements and individualities behind. The following section discusses the role and behaviour of two major actors in the development process, i.e., planners and developers, in more depth.

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1.6.2 Developers’ and Planners’ Roles as Major Development Actors Developers and planners are central actors in the development process. Adams et al. (2012) build on Healey’s institutional structure and agency model of the development process, where she links actor strategies to wider structural contexts (i.e., economic, social, and political), as well as the Guy and Henneberry’s (2000) work on development cultures, in order to understand structural issues and developer/planner behaviour within the development industry. Adams et al. (2012) argue that although many advanced economies greatly rely on private-sector agents for the implementation of urban projects, they suffer from a lack of information and understanding of developer behaviour, and as such they call for a better understanding of the development industry so that planners can be more effective in policy-making. In analysing developer behaviour, Adams et al. highlight the interaction of finance with personal judgement in determining the success of developers. However, they warn that too much emphasis on personal judgments of developers, which can be seen in ad-hoc institutionalism, would undermine the objective analysis of the development process. As such, they call for analysis to go beyond individual developers and to look at the collective behaviour of developers and their institutional characteristics, which for example can be seen through “fashionbased” developments. Nevertheless, they attest that developer behaviour can be varied more than planner behaviour. With regard to the role of planning in the development industry, while Healey (1992) considered planning in opposition to the market, and Webster and Lai (2003) commented that those with public ethics often view markets as threats, Adams and Tiesdell (2010) argue that the market and planning relationship is symbiotic, with planners assisting to construct the land and property markets. They argue that these markets are socially constructed, not given; as such, building on the work of institutional economics, they highlight that planners should be seen as market actors who are involved in framing property markets. Adams and Tiesdell (2010) highlight that planners, through their actions, impact and frame market performance at three distinct levels. First, at the macroeconomic level, restrictive planning policies can make land and property more expensive or can improve affordability by releasing more land as discussed by Keivani et al. (2008). At the next level, i.e., urban land economics impact, by providing infrastructure and regeneration frameworks, the public sector tries to create markets or rescue weak local property markets. At the third level, i.e., microeconomic impact, planning actions can impact financial performance of individual projects; for example, in regeneration projects the facilitating role of the public sector can have risk-reduction impacts. Further, Adams et al. (2012), in studying the Scottish planning policies towards developers, categorise these policies under three broad aims: first, to influence the quantity of market supply and demand, which is grounded in neoclassical economics; second, to overcome market failure grounded in welfare economics; and third, to transform market cultures and practices grounded in institutionalism. Adams et al.

1.6 Property Development from an Institutionalist Perspective

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argue that planners need a more realistic understanding of how the development industry operates, which is key to negotiating with the developers and highlights “the case for a more thorough understanding of the development industry, and particularly of the cultural differences between different types of developers, as a prerequisite for more effective policy-making” (Adams et al. 2012, p. 2593). Further, Adams and Tiesdell (2010) conclude by calling for “a better understanding of the motives and behaviour of private-sector implementation agents, in order to recognise which landowners, developers, and investors are most likely to share policy agendas, and which are likely to be more hostile” (Adams and Tiesdell 2010, p. 199). In their conclusion, Adams and Tiesdell highlight that since Healey’s work in the early 1990s, where she analysed the interaction between planning regulation and market conditions, followed by Pennington’s (2000) and Webster and Lai’s (2003) work on institutional economics, there has been little interest in state-market relations in land and property; as such, they call for further research on this issue, which is picked up by this research in framing the research questions and informing the analysis chapters. Further to the earlier discussions on development processes from an institutional perspective, the following section discusses the impact of institutions on place-based developments.

1.6.3 Institutions and Place Development Institutions can have significant impact on place-based development and growth due to their role in the mediation of wider economic contexts as well as through devising incentives for investment. Tomaney (2014) reviews the recent debates on the role of institutions in economic development, highlighting the role that the state, through local and regional governance, can play in promoting or hindering placebased development. Tomaney argues against economic geographers like Glaeser (2012), who claim that spatial disparities within regions and cities are reflections of rational responses of agents to market signals in pursuit of the highest returns on skills and capital. Tomaney argues against the overarching importance of economic concentration in economic growth, draws attention to the importance of urban governance and institutions, and states that regions that experience poor economic performance and low growth equilibriums suffer from institutional bottlenecks. This includes lack of consistency in the implementation of policies by institutions, institutional instability, lack of strategic vision, and lack of capacity. As such, in addition to place effect and people effect, he argues that a government effect can also contribute to economic development or geographic inequalities. Tomaney (2014) highlights that similar institutional settings can work differently in different territories. Institutions are shaped through a long-run evolution of the political-economic structure of a society. Institutions shape rules in a society and

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are the humanly devised constraints shaping human interactions. As such, the effectiveness of institutions and resultant economic growth is determined based on the interactions between communities and formal institutions. Further, he highlights that the behaviour of agents and firms in any territory is embedded in national and local institutional environments that shape social and economic trajectories. As outlined above, the development process is not simply a technical process, and it is influenced by political decisions that are of a different character than economic decisions. Tomaney highlights that political decisions create the conditions through which markets and economies evolve and are hence fundamental determinants of economic growth. In calling for further research Tomaney argues that the institutional understanding of development processes should be used in exploring how economic agents embedded in territorial networks affect economic outcomes in local contexts. Further, he mentions the need to understand cultural legacies and economic variables or institutional factors that explain the regional governance differences. He further highlights the need for additional research on the shape of effective institutions and how they need to evolve to support long-term growth. However, he states that one of the challenges of institutional research is to find “generalizable frameworks in order to identify the regularities in how institutions shape economic performance” (Tomaney 2014).

1.7 Conclusions Based on the theories that were discussed in this chapter, the diagram in Fig. 1.1 illustrates the analytical framework that shapes the analysis chapters of this research. Starting from the top, the diagram illustrates that the main problem of this research is the situation of run-down neighbourhoods in Tehran as one of its major urban issues. This research seeks to understand how the deterioration problem can be solved through the kind of redevelopments that work best in these areas. As such, urban regeneration is studied as an urban intervention policy, as a policy that addresses improving dilapidated conditions of run-down areas, while at the same time accommodating urban growth within city boundaries. This issue is an ever-increasing problem in developing countries, where cities are experiencing rapid growth and high levels of deterioration. Since the aim is to study the regeneration projects and their process, how this process is implemented is of critical importance. Therefore, the process of regeneration is studied under the subheadings of implementation to understand social and economic consequences on the ground, as well as the property development aspect of regeneration as an urban planning approach towards physical deterioration. Stemming from the theoretical discussions outlined, urban regeneration is analysed under the two modes of direct and indirect planning. The direct planning mode is studied through a comprehensive redevelopment project, and the indirect planning mode through a piecemeal redevelopment project. Finally, the outcomes of these

1.7 Conclusions

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Analytical Framework Deterioration Problem

Regeneration Process (Structure) Property Development Developers (Agency)

Planners (Agency)

Implementation Developers (Agency)

Planners (Agency)

Direct Planning

Indirect Planning

Comprehensive redevelopment

Piecemeal redevelopment

Outcomes

Outcomes

Fig. 1.1 Analytical framework (Produced by author)

two types of interventions are analysed in detail under the overarching themes of regeneration that were outlined earlier. At a theoretical level, urban regeneration is analysed under the two modes of direct and indirect planning. This comparative analysis builds on the work of Webster and Lai (2003) and Carmona (2009). The research is trying to investigate the dichotomy of state versus market, or, in the words of Lai and Webster, spontaneous versus centralised planning, in the run-down neighbourhoods of Tehran. These modes were analysed in urban regeneration under the two redevelopment models of piecemeal and comprehensive redevelopment. The piecemeal model is a form of indirect planning, where the state has a minimal role and developers and residents are in charge of implementation, while the comprehensive model is a form of direct planning where state agencies implement the whole project, and other actors like residents and developers do not have a decisive role.

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Further to this overarching comparative theme, institutionalist approaches as discussed earlier inform the analysis. Building on Healey’s work, this research is an empirical account of two developments, utilising institutional analysis based on the behaviour of actors related to the resources, rules, and ideas that were employed. This research studies the relation between structure and agency in the development process. The structure is the development process and the planning framework within which the agents operate (i.e., direct and indirect planning modes). The agency is the way in which individual agents and property actors pursue their objectives (i.e., developers and planners) (See Fig. 1.1). Further, this research builds on Guy and Henneberry’s (2000) approach in utilising institutional analysis as a methodological approach in unravelling the ways in which property actors see the development process and their subsequent actions, arguing that social and economic structures should be studied at the same time and cannot be easily separated. Studying developer behaviours, they found that decisions that are described as irrational from a purely economic perspective could be understood by adding a social perspective. As such, this research analyses the developers’ behaviour, combining both economic motivations and social aspects of their decision-making process.

References Adair A et al (1999) Evaluation of investor behaviour in urban regeneration. Urban Studies 3(12):2031–2045 Adams D (2001) Urban planning and the development process. Routledge, London Adams D, Tiesdell S (2010) Planners as market actors: rethinking state-market relations in land and property. Planning Theory and Practice 11(2):187–207 Adams D et al (2012) Exploring the “notional property developer” as a policy construct. Urban Studies 49(12):2577–2596 Allen J et al (2004) Housing and welfare in Southern Europe. Blackwell Publishing, Oxford Ball M (1998) Institutions in British property research: a review. Urban Studies 35:1501–1517 Bottero M et al (2020) Experimenting community impact evaluation (CIE) for assessing urban regeneration programmes: The case study of the area 22@ Barcelona, Cities 99:102464 Carmona M (2009) The Isle of dogs: four development waves, five planning models, twelve plans, thirty five years, and a renaissance…of sorts. Prog Plann 71:87–151 Carter A (2000) Strategy and partnership in urban regeneration. In: P Roberts and H Sykes (eds) Urban regeneration: a handbook. Sage, London Choudhary BK, Das D (2020) Urban governance under neoliberalism: increasing centralization or participatory decentralization. In: R Thakur et al (eds) Urban and regional planning and development. Springer Nature Switzerland, pp 303–312 Chen Y, Qu L (2020) Emerging participative approaches for urban regeneration in Chinese megacities. Journal of Urban Planning and Development 146(1):04019029 Cheshire P (2006) Resurgent cities, urban myth and policy hubris: what we need to know. Urban Studies 43(8):1231–1246 Ciaramella A, Dall’Orso M (2021) Urban regeneration and real estate development; turning real estate assets into engines for sustainable socio-economic progress. Springer International Publishing

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Colantonio A, Dixon T (2011) Social sustainability and urban regeneration: best practice from European cities. Wiley-Blackwell, Oxford Colenutt B (1999) New deal or no deal for people-based regeneration. In: R Imirie and H Thomas (eds) British urban policy: an evaluation of the urban development corporations 2nd ed. Sage, London Colomb C (2009) Gentrification and community empowerment in East London in whose urban renaissance? An international comparison of urban regeneration strategies. L Porter and K Shaw (eds). Routledge, Abingdon Couch C, Fraser C, Percy S (2003) Urban regeneration in Europe. Blackwell, Oxford Deas I et al (2000) Rethinking the urban development corporation “experiment”: the case of central Manchester, Leeds and Bristol. Progress in Planning 54:1–72 Edwards M (1990) What is needed from public policy? In P Healey and R Nabarro (eds) Land and property development in a changing context. Gower, Aldershot Eizenberg E (2019) Patterns of self-organization in the context of urban planning: reconsidering venues of participation. Planning Theory 18(1):40–57 Erfani G, Roe M (2020) Institutional stakeholder participation in urban redevelopment in Tehran: An evaluation of decisions and actions. Land Use Policy 91:104367 Evans J, Jones P, Krueger R (2009) Organic regeneration and sustainability, or can the credit crunch save our cities? Local Environment 14(7):683–698 Glaeser E (2012) The Triumph of the city: how our greatest invention makes us richer, smarter, greener, healthier, and happier. Pan Macmillan, London Guy S, Henneberry J (2000) Understanding urban development processes: integrating the economic and the social in property research. Urban Studies 37:2399–2416 Guy S et al (2002) Development cultures and urban regeneration. Urban Studies 39(7):1181–1196 Harvey D (2008) The right to the city. New Left Rev 53:23–40 Healey P (1991) Models of the development process: a review. Journal of Property Research 8:219– 238 Healey P (1992) An institutional model of the development process. Journal of Property Research 9(1):33–44 Healey P, Barret S (1990) Structure and agency in land and property development process: some ideas for research. Urban Studies 27:89–104 Keivani et al (2008) Public management of urban land, enabling markets and low-income housing provision: the overlooked experience of Iran. Urban Studies 45(9):1825–1853 Liu X et al (2019) Property-rights regime in transition: understanding the urban regeneration process in China—A case study of Jinhuajie. Guangzhou Cities 90:181–190 MacLaran A (ed) (2003) Making space: property development and urban planning. Arnold, London Massoud M et al (2019) Regeneration-led gentrification: a comparative study of Atabak and KhaniAbad neighborhoods in Tehran. Int. J. Architect. Eng. Urban Plan 29(2):195–211 Nappi-Choulet I (2006) The role and behaviour of commercial property investors and developers in French urban regeneration: The experience of the Paris region, urban studies 43(9):1511–1535 Neducin D, Krklješ M, Perovic SK (2021) Demolition-based urban regeneration from a postsocialist perspective: case study of a neighborhood in Novi Sad, Serbia, sustainability 13:10430 Noring L (2019) Public asset corporation: a new vehicle for urban regeneration and infrastructure finance. Cities 88:125–135 Pennington M (2000) Planning and the political market: public choice and the politics of government failure. Bloomsbury Publishing, London Porter L, Shaw K (ed) (2009) Whose urban renaissance? An international comparison of urban regeneration strategies. Routledge, Abingdon Pradel-Miquel M (2021) Analysing the role of citizens in urban regeneration: bottom-linked initiatives in Barcelona. Urban Research & Practice 14(3):307–324 Rabbiosi C, Coletti R, Salone, C (2021) Introduction to the special issue: between practices and policies: rethinking urban regeneration in Southern European cities after the crisis. Urban Research & Practice 14(3):217–222

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Roberts P, Sykes H (2000) Urban regeneration: a handbook. Sage, London Schaller S (2021) Public–private synergies: reconceiving urban redevelopment in Tübingen, Germany. Journal of Urban Affairs 43(2):288–307 Tapp R (2019) Layers of finance: historic tax credits and the fiscal geographies of urban redevelopment. Geoforum 105:13–22 Tasan-Kok T, Van den Hurk M (2020) Contractual arrangements and entrepreneurial governance: flexibility and leeway in urban regeneration projects. Urban Studies 57(16):3217–3235 Tomaney J (2014) Region and place I: institutions. Progress in Human Geography 38(1):131–140 Turok I (1992) Property-led urban regeneration: Panacea or Placebo. Environment and Planning A 24:361–379 Urban Task Force (1999) Towards an urban Renaissance: final report of the Urban Task Force. E & FN Spon. London Webster C, Lai L (2003) Property rights, planning and markets: managing spontaneous cities. Edward Elgar Publishing, Cheltenham, UK Wilkinson S, Reed R (2008) Fifth edition, Property development. Routledge, Abingdon, UK Zhan Y (2021) Beyond neoliberal urbanism: assembling fluid gentrification through informal housing upgrading programs in Shenzhen, China, Cities 112:103111

Chapter 2

Urban Development and Redevelopment in Developing Countries and the Middle East

Abstract This chapter analyses the urban development and redevelopment processes in developing countries and the Middle East. The chapter starts with a discussion on the urban theories that stem from developing countries and the global south, and analyses the market-enabling strategies and modes of housing provision in the context of developing countries. Within the developing world context, the Middle Eastern cities with their similar characteristics including vast informal run-down areas as a result of rapid population growth and the state’s inability to implement development regulations are analysed. Further, Turkey and Egypt as the two other largest countries in the Middle East with a track record of urban redevelopment projects are discussed in detail. Each country’s unique political and societal trends that affected their urban redevelopment process, as well as government policies to manage and transform informal run-down areas over the past few decades are reviewed. Keywords The developing world cities · The Middle Eastern cities · Cities of the Global South · Urban redevelopment in the Middle East · Run-down areas of the Middle East · Urban regeneration in Turkey · Urban regeneration in Egypt

2.1 Urban Development in Developing Countries Further to the theories that were discussed earlier in the literature review chapter, this section looks at theories that have stemmed from the practices in developing countries, highlighting the cultural, socioeconomic, and political issues that exist in this context. As highlighted earlier, although urban regeneration theories have not been researched significantly in the context of the developing world, a great deal of research has been undertaken on affordable housing provision, which provides insights into the context of developing countries and is discussed in this section.

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2022 K. Soltani, Redeveloping Tehran, The Urban Book Series, https://doi.org/10.1007/978-3-030-97091-8_2

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2.1.1 Urban Planning Theories from Developing Countries Many scholars call for exploration of new territories in urban development research. Rabbiosi et al. (2021) state that the “Anglo-driven small world of international academia” should be challenged with more inter-cultural research. The scholars’ attention should be moved away from iconic urban areas, to less discussed urban centres to explore new approaches to urban regeneration. With the majority of the world’s urban population living in developing countries and the global South, there is a need for new theories stemming from the practices in the global South. Parnell and Robinson (2012) with a post-neoliberal analysis on urban governance call for further provincialised research in order to understand the right type of state intervention in urban development. They place their emphasis on local conditions in explaining policy outcomes, arguing that elements such as informality and traditional authority, can be as important as public policy in shaping urban development in the global South. Calls for more community involvement and less state intervention are not derived from neoliberal theories; rather, they are a product of distrust towards the state. One of the practice-related research questions that Parnell and Robinson (2012) raise in their conclusion for future research is: “How much and what type of government is helpful for promoting urban development?” (Parnell and Robinson 2012, p. 610). This is one of the issues this research is trying to understand to some extent by analysing two different modes of urban governance in urban development processes. This research attempts to make a theoretical contribution based on practice-based understanding of urban processes from the cities of the global South. Southern urban issues, for example, urban informality, have become prominent in the recent literature. This research places an emphasis on urban informality issues, i.e., the piecemeal redevelopment model, and how social and culture issues in developing countries impact redevelopment of run-down neighbourhoods.

2.1.2 Enabling Property Markets in Developing Countries Further to Healy and Barret’s (1990) discussion of a need for an institutional approach towards property development, Keivani and Werna (2001a, b) utilise a structure and agency approach to analyse modes of housing provision in developing countries through market-enabling strategies. In analysing these strategies, which was one of the main strategies of the World Bank in the 1990s, the institutional approach allowed them to go beyond a solely supply-and-demand analysis by taking into account structures of provision and interactions between various agents. Within this framework they highlight the complex country- and city-specific relationships that exist between various actors within cultural, social, and political frameworks (Keivani and Werna 2001a, b).

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Keivani and Werna (2001a) argue that in developing countries interactions between various agents and structures create significant obstacles to the efficiency of private property markets. They attribute this to the underdevelopment of institutional capacities, scarce human and material resources, as well as the impact of social, cultural, and political factors. In order to enable private markets in developing countries, the World Bank (1993) made the following recommendations for government housing provisions: developing property rights, developing mortgage finance, rationalising subsidies, providing infrastructure, regulating land and housing development, organising the building industry, and developing institutional frameworks. These recommendations aimed at improving the building standards, improving the credit system, and creating more flexible land use regulations. Keivani and Werna (2001a) warn that any deregulation of housing markets in developing countries needs to take into account the structures of provision and relationship of agents in specific contexts. An example of possible adverse impacts that they highlight is the increase in investment demand, as opposed to use demand, caused by deregulation that can significantly increase land prices. Keivani and Werna (2001a) elaborate on the above by outlining the following housing market failures: capital market failures, imperfect information, externalities, and inelasticity of supply. Capital market failures are due to housing prices that are a few times higher than the annual earnings of individuals, and borrowing is not available to the low-income population; this is exacerbated in developing countries, as the gap between earnings and housing prices is much greater and financial institutions are far less developed. Imperfect information results from the presence of a complex network of real estate agents and housing market information that is not available to everyone; this problem is worse in developing countries due to the greater secrecy in those markets. Externalities include the impact that neighbourhoods and surroundings can have on the value of a housing unit; while this problem exists in both developed and developing countries, due to lax regulations these impacts can be greater in developing countries. Inelasticity of supply occurs when supply does not increase directly with the increase in demand, and prices can keep rising for a long period of time before market equilibrium can be reached; this can be attributed to land shortages in specific areas and the slowness of the construction industry in responding to demands. As such, Keivani and Werna (2001a, b) highlight the need for governments to intervene in order to make the markets more efficient and respond to some of the mentioned market failures. Urban regeneration projects, for example, are one of these attempts by governments in light of market failures, whereby they utilise tax incentives and regulations to enable market activity (Keivani and Werna 2001a, b). Mukhija (2004), while highlighting the need for government market-enabling strategies, attempts to understand how to enable market actors in developing countries. He also highlights the need for a better understanding of the overlap between formal and informal sectors in housing provision. He highlights that, in some instances, there might be a change from “market-driven and government assisted policies” to “government-driven and market assisted policies.” He suggests balancing the conflicting demands of regulation and deregulation (Mukhija 2004). In other

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research in 2001, Mukhija discusses similar paradoxes between regulation and deregulation and privatisation and public investment by analysing the slum redevelopment programmes in Mumbai, India. He highlights that market enabling does not necessarily mean less state involvement but rather a different type of state involvement, in which the state’s role is to provide institutional support for property development (Mukhija 2001). Mukhija (2004) concludes with the importance of understanding the impact of public policy on the ground. He suggests that planning frameworks need to be more flexible in order to accommodate informal practices. He demonstrates that public policy should avoid naive optimism and assume opportunistic behaviour by all actors, including the developer, homebuyer, and public agencies (Mukhija 2004).

2.1.3 Modes of Housing Provision in Developing Countries Utilising a structure and agency approach by taking into account the socioeconomic, cultural, and political frameworks of developing countries, Keivani and Werna categorise the modes of housing provision in two major categories: conventional (formal) and unconventional (informal). Conventional modes include public, private, and cooperative modes of housing provision, and unconventional modes include squatters, informal subdivision, and rental housing. Highlighting earlier work by John Turner (1976) on self-build processes by low-income households in informal settlements, Keivani and Werna describe the informal category as a necessary component of urban growth in developing countries, where the majority of urban poor cannot have access to housing via the formal sectors (Keivani and Werna 2001b). Housing provision in developing countries has been mainly dominated by the nonpublic sector, including the private sector (both formal and informal), households, and cooperatives. In developing countries in general, and in Iran specifically, individual owner-occupier developments, which are commissioned by the landowneroccupier to a builder, are the most common type of housing production in urban areas. Due to underdevelopment of financial institutions and markets, the major part of financing for this type of housing comes from personal means. Keivani analysed the Iranian situation in the late 1980s and found that only one-third of the cost of construction was financed through the banking system, and the rest was funded from personal savings, sale of jewellery and valuables, as well as borrowing from friends and family. Further, the significance of the informal sector in housing provision in developing countries is due to the inability of low-income groups to purchase housing through the formal sectors, which in itself stems from the inability of the formal employment sector to absorb many urban dwellers with adequate salaries. This gap is even greater for the poorest sections of low-income groups. As such, the state is forced to tolerate a certain level of irregularity in developing countries (Keivani and Werna 2001a). The majority of the run-down neighbourhoods of Tehran were mainly built with characteristics similar to the informal subdivision mode of housing provision (Tarh o Amayesh Consultants 2003; Zebardast 2006). This form of housing provision

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is becoming dominant in many developing countries for low- and middle-income households. In this mode, private developers subdivide land either in collaboration with private landowners or by taking over public land, which is then subdivided into plots and sold to households or building contractors. There is a high degree of selfbuilding involved in this housing development process. Services and infrastructure are mainly substandard in these areas, and plot sizes, building density, and public space allocations are not in compliance with planning regulations. Further, as is also the case in Tehran, households who cannot afford to purchase in these informal subdivisions, or the new immigrants who do not have the social connections to join these subdivisions, become renters. Despite its significant shortcomings, this mode offers housing at a relatively low cost and flexibility to its residents (Keivani and Werna 2001a). Madanipour (1998), in his book about Tehran, outlines public-sector development agencies that can be found in many governmental organisations. These include government ministries, revolutionary organisations, municipalities, and charities. This multiplicity of development agencies that have overlapping areas has resulted in conflict in many circumstances and hence highlights the need for coordinating mechanisms. These public-sector development agencies mainly commission privatesector consultants and contractors to develop their projects. Therefore, they invest public money in the production of space. They become channels through which the government earnings, mainly from oil production, transfer to the market. Madanipour highlights that these agencies can be involved in two types of decision-making: first, direct intervention, and second, regulation. In the former they can choose the location, initiate development, invest in it, and have a powerful stake there as well. In the latter, they use economic and land use planning and policies that control private development agencies. These two forms often operate independently and at times create conflicts in the process of development. The result of this conflict between public agencies and competition between private-sector agencies, in an underinstitutionalised market economy, puts pressure on the most vulnerable, who are in danger of exclusion (Madanipour 1998). Direct government direct housing provision, usually has political motives in order to pacify the low-income population and demonstrate that governments are doing something and fails in most cases. In Iran, two forms of government housing provision have been experienced extensively. The government’s site and services provision programmes have been extensively experienced in Iran after the 1979 revolution. Housing provision through cooperatives has also been encouraged by the Iranian government, and only to some extent has it achieved its objectives. Many housing cooperatives were formed in Iran through employers including factories, ministries, or trade organisations in the 1980s and 1990s. Within this system, people’s resources are pooled into a formal organisation, which will then, on behalf of its members, acquire land, obtain loans, and manage the development process (Keivani and Werna 2001a). In terms of development models of this research, the piecemeal redevelopment model is mainly developed in accordance with the joint venture between small-scale developers and landowners mode of provision. As described by Keivani and Werna

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(2001a), in this mode a joint contract is made between landowners and small-scale developers to develop their land into apartments and in turn provide them with a share of apartment units. In this mode, developers usually have a small amount of working capital, and the rest is funded either through presale of units or through the banking system. The comprehensive redevelopment model of the research is mainly developed in accordance with the public–private joint venture mode of provision. As described by Keivani and Werna (2001a), in these partnerships, the state provides cheap land and tax incentives, and the private sector provides finance and builds housing. They highlight that this mode has proved effective in many developing countries. In advocating a pluralistic mode of housing provision in developing countries, Keivani and Werna (2001a, b) call for going beyond solely market-enabling strategies and adjustments to supply and demand. By taking an institutional perspective, they call for taking into account structures of provision and various agents involved in each form of provision. They believe that adjustments to supply and demand fail to consider the complex relationships between actors within specific social and cultural contexts.

2.2 The Middle Eastern Context Within the developing world context, the Middle Eastern cities have many similar characteristics that differentiate them from other developing world cities. Rapid population growth coupled with the state’s inability to implement development regulations have resulted in vast informal urban areas throughout the Middle East. UN Habitat in 2012 estimated that approximately 33 percent of the urban population in the developing world (about 863 million people), lived in slum areas. This figure in West Asia was 24.6 percent of urban population and 13.3 percent in North African cities (Ragheb et al. 2016). Over the past few decades many Middle Eastern governments tried to tackle the urban problems in these informal areas. During the transformation of these areas, while each neighbourhood is unique in its own right, many similarities can be found in societal, political, and planning trends. In most Middle Eastern countries a large gap between housing supply and demand exist, and demographic characteristics indicate that housing demand will remain high for the next few decades. Housing shortage for low-income groups is a serious economical and social problem. Home mortgage finance facilities are broadly inadequate or nonexistent for low- and middle-income population, and housing construction initiatives tend to be capital-intensive. In the last few decades, government housing policies were conducted through heavily subsidised public-sector housing institutions. These institutions were often poorly organised, politically manipulated, and financially unsustainable. The urbanisation process and increase in urban poverty has resulted in rising unauthorised housing without access to basic urban infrastructure. As such suitable housing policies for low-income households can have meaningful impacts on their quality of life (Erbas and Nothaft 2005).

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Erbas and Nothaft (2005) in their overview of housing conditions in the Middle East outline a few market-specific problems. High house-price-to-income ratio in most Middle Eastern countries is a major predicament to home ownership. This metric was 6–7 in Egypt, and as high as 12 in Algeria. Same goes for the limited availability of mortgage financing, as ratio of total mortgage loans to total loans in financial institutions was in the 7–8 percent range in Egypt. At the same time, unauthorised and squatter housing share ranged from 15 percent in Jordan to as high as 65 percent in Egypt and Turkey from the total housing stock (Erbas and Nothaft 2005). On the other hand, fuelled by oil revenues, the Middle Eastern countries experienced construction booms during the past few decades, which resulted in extensive urban development. In order to respond to this rapid growth, urban planning has been more focused on the built environment and physical aspects of land use. As such, a more holistic approach to deal with the urban planning bottlenecks such as shortage of affordable housing and lack of institutional coordination amongst agencies who deal with urban development is needed. A longer term vision on accommodating growth while ensuring both efficiency in the use of urban resources and equity amongst citizens through public participation is of crucial importance (Al-Hathloul 2004). Al-Hathloul (2004) in the concluding paper of a special issue of Habitat International on planning issues in the Middle East highlights dealing with rapid growth of cities, developing stronger planning institutions, and incorporating public consultation in the planning processes as the main challenges facing urban planners in the Middle East. This chapter looks more closely at the conditions in Turkey and Egypt as the two other largest countries in the Middle East (see the following map) with a track record of urban redevelopment projects. Both these countries like Iran have vast informal run-down areas, and have tried to transform them in the past few decades. Others have also looked at planning issues in Iran, Turkey, and Egypt alongside each other. In a novel study of urban transformations in the context of the Middle East, Masoumi et al. (2019) investigate urban morphology transformation of Istanbul, Cairo, and Tehran as three megacities of the region during the past decades. They outline that the studied geographical context is generally accepted to have a wide range of similarities which facilitates transferability of the research outcomes to other large cities in the region. Each of the studied cities experienced unique planning, political, and societal trends that transformed neighbourhood morphologies. Tehran experienced top-down interventions of the 1930s and 1940s, sharp rise in oil prices and the resultant socioeconomic changes in the 1970s, 1979 revolution, and the Iran–Iraq War in the 1980s. Istanbul saw internal migration as a result of industrialisation, and mass housing production policies. Cairo encountered European urban planning inspirations in the late nineteenth century, socialist ideologies in the 1960s, and the capitalist approach to urban planning in the more recent years. Although there are differences in initiatives and the ways in which urban planning policies are achieved, Masoumi et al. (2019) outline considerable similarities in neighbourhood transformations, concluding that the three researched cities can be studied as parts of one geographical and cultural context (Masoumi et al. 2019) (Fig 2.1).

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Fig. 2.1 The Middle Eastern countries by population (Source Drawing created by author based on population information from http://www.worldatlas.com/ accessed 1 Aug 2021, and base map from Google Maps)

2.3 Urban Redevelopment in Turkey 2.3.1 Background Agricultural mechanisation and industrialisation in Turkey led to rapid urbanisation as population flocked from rural to urban areas, with 1.5 million people immigrating to cities between 1950 and 1960, half of which immigrated to the four largest cities. This trend resulted in mushrooming of illegal settlements and squatters in urban peripheries. Squatter population increased from 250,000 in 1955 to 5,750,000 people in 1980, equivalent to 26 percent of the national urban population. In the 1980s, squatter developments were prevalent in most Turkish cities, and it was estimated that more than half of urban population were residing in squatters by the 1980s. The inadequacy of governments to meet this demand for housing was the main reason for squatter development. These developments emerged as a self-help solution to the housing problem. Neighbourhoods were created with community support and possibilities of informal economy. Over time, these developments became an integral but problematic part of Turkish cities. These neighbourhoods had unsafe and unhealthy

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conditions magnifying their poverty situation. As such transformation of these areas became an important part of Turkey’s urbanisation policy (Korkmaz and Balaban 2020). Initial policy responses to the squatter problem in the 1960s were mainly clearance of these areas. Until the 1980s several legal regulations aimed to clear the squatter areas and many of them failed. In the early 1980s, the attitude towards squatter areas changed from clearance to redevelopment. Further to the neoliberal restructuring of the Turkey’s Economy in the early 1980s, the national government devised policies to support the housing sector and respond to the housing demand. The new laws in the mid-1980s created the opportunity to prepare development plans as the legal basis for squatter regeneration. Further in 1984, Mass Housing Administration (MHA) became the authority responsible for determination of urban redevelopment areas and redevelopment plans. After the mid-1980s, squatter redevelopment became a common practice in major cities, with the number of construction permits in squatter areas increasing from 40,000 units in 1984 to 110,000 in 1987. Habitat-II Conference in Istanbul In 1996, was focused on the need to address the squatter problem and urban regeneration was proposed as the right policy for transformation of these areas. Until the 2000s, urban regeneration was treated as a project-based housing supply strategy as opposed to a more comprehensive restructuring process (Korkmaz and Balaban 2020). At the start of the new millennium while Turkey was in a major economic crisis, many Turkish cities had low-quality housing stocks. In order to remain vibrant and competitive in a global landscape, urban regeneration was required. Following the election victory in 2002 of the Justice and Development Party (AKP) the conditions changed. Turkey started to experience high economic growth thanks to IMF and other global economy financings. Building on these the AKP government introduced institutional, administrative and legal reforms with major consequences for real estate markets and urban planning. These reforms triggered a construction boom, and resulted in the implementation of hundreds of urban regeneration projects known as UTP (Urban Transformation Projects). In 2005, AKP passed two crucial laws that enabled urban regeneration in areas that were perceived to have natural risk, physical decay, and economic decline. The AKP government also reshaped the Housing Development Authority (HDA), granting extensive urban planning authority, with HDA undertaking most of the urban regeneration implementation from preparation of land use plans to construction of new buildings (Kuyucu 2018). One of the reasons that these projects gained momentum in Turkey, similar to Iran, is the earthquake vulnerability of these areas, which was underscored following a major earthquake in 1999 in Marmara, Turkey (See Ozcevik et al. 2010). A major earthquake in Bam, Iran in 2003, also highlighted the vulnerability of run-down areas towards possible earthquakes and created debates around redevelopment of these areas (See Asgari et al. 2008). However, Gundogdu and Gouth (2009) mention that the Turkish government used the issue of earthquake vulnerability of squatter settlements as a tool to legitimise demolition. In their research they demonstrate how squatter settlements were transformed into luxury housing. Whereby the residents were evicted, and could no longer afford to buy the new apartments and were only

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offered housing far away from the city centre in the periphery (Gundogdu and Gouth 2009). During the second half of 2000s the motives of urban regeneration significantly changed, with an increasing emphasis on the construction and real estate sectors in the hope of growing the Turkish economy in the new millennium. These regeneration projects were profit-oriented projects aiming to create prestige urban areas with attractive urban spaces in order to create economic growth, and improve the image of cities in the global competition. This approach led to a rapid increase in urban regeneration projects, and by the end of 2015 forty-five urban regeneration projects were underway in Ankara alone (Korkmaz and Balaban 2020). Ay (2019) highlights that Turkey has seen a radical market-based approach towards urban renewal, and has served as an example of neoliberal restructuring for many other developing countries. Urban renewal projects were a dominant urban planning practice across Turkey, with the ruling Justice and Development Party (AKP) committed to the renewal of a third of the national housing stock in twenty years. Their policy agenda has been criticised for displacing the urban poor in favour of property redevelopment, with disaster risk as a legitimisation mechanism for the large-scale top-down redevelopment projects (Ay 2019). Decentralisation urban planning policies in Turkey saw a rapid reversal under the authoritarian rule of the AKP government, epitomised by its populist leader Erdogan. These policies resulted in limitations to the local decision-making powers, and local development plans. This recentralisation was exemplified in the power to pursue urban renewal projects requiring central government’s approval. The enactment of the urban renewal act in 2012 framed urban renewal as a tool to mitigate earthquake risk through neighbourhood or parcel level redevelopment in designated high-risk areas. Concentrating the urban planning power for urban renewal projects at the central government level, the act frames urban renewal as the government’s liability to protect citizens’ lives and property. As a result municipal governments can only conduct urban renewal projects if central government delegates the authority to them (Ay 2019). Kuyucu (2018) believes that economic neoliberalisation in Turkey has paved the way for implementation of ambitious urban regeneration projects as well as other entrepreneurial urban planning policies. However, unlike advanced capitalist countries, such reforms have not limited the authority of the central government in order to increase the autonomy of local residents and administrations. To the contrary, it has resulted in expanding the central government’s power in managing urban economies (Kuyucu 2018).

2.3.2 The State of Urban Redevelopment in Turkey The two major cities in Turkey, namely Istanbul and Ankara, experienced radical state-led transformations through Urban Transformation Projects (UTPs) that were

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outlined in the previous section. Many scholars analysed these urban regeneration projects during the past decades, a few of which are outlined in this section. Istanbul saw massive internal migration and informal settlements as a result of industrialisation (Masoumi et al. 2019). Kuyucu and Unsal (2010) analysed two stateled urban regeneration projects in Istanbul, namely Basibüyük and Tarlabasi, where government’s neoliberal policies resulted in transfer of properties in slum areas to higher-income residents with major social consequences and resistance from residents. Each case study had a different tenure structure, one with majority of owneroccupiers, and the other tenants. In the absence of social housing policies, informal markets provided housing solutions for low-income groups, as such appropriation of residents’ property through Urban Transformation Projects facilitated by the government’s Mass Housing Administration (MHA) faced major opposition. Further, the Turkish government’s attempts in 2007 to formalise the housing sector by introducing a mortgage system, in effect further excluded the low-income population from the formal housing market due to their insufficient income (Kuyucu and Unsal 2010). The following were the major shortcomings in the implementation of these regeneration projects: first, the housing replacement mechanism did not guarantee new units to residents. The MHA offered to purchase existing properties at approximately quarter of the value of new apartments, offering loans for the remainder of property values that many residents were unable to repay. Further, the new units were significantly smaller than old ones, and too small for the majority of households. Second, demolition criteria of the existing housing stock were not clearly defined, and raised concerns on why some areas were labelled as obsolete. Third, residents were excluded from the decision-making process, and were only informed about the projects after official approvals. Fourth, there was a clear lack of social initiatives and economic enabling programmes for the residents (Kuyucu and Unsal 2010). The other major Turkish city, Ankara, was the first to experience squatter developments, with the number of squatter units in the city rising from 70,000 in 1960 to 240,000 units in 1980 (Korkmaz and Balaban 2020). Topal et al. (2019) reviewed three mass housing redevelopment projects in Ankara namely: Batıkent Cooperative, Dikmen Valley, and Northern Ankara projects. By analysing these large-scale projects, authors try to highlight the change in the role of state in provision of housing and finance by concentrating on the relationship between the state, residents, and market impact within the context of increasing housing demand (Topal et al. 2019). Lack of housing supply together with inadequacy of finance mechanisms defined the attempts of successive Turkish governments. Mass housing projects through urban redevelopment was the state’s solution to the social and physical problems in squatter neighbourhoods on the one hand and growing population and lack of housing supply on the other hand. Each analysed project tried to tackle this problem. The Batıkent Project plan was to offer affordable housing to lower-income residents to avert the expansion of squatter areas in the outskirts. In the early stages participatory and inclusive planning was part of the process, however, later on this was affected by the changing circumstances of the neoliberal era in the 1980s. The two other projects demonstrated a redefinition of the role of government in the neoliberal era

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in housing development and its finance structure by redeveloping squatter areas. The Dikmen project involved large-scale private construction companies that benefited from the capital markets liberalisation with access to global financial markets. The project demonstrated how a mass housing project transforms into a leading urban regeneration model over 3 decades at its different stages. The Northern Ankara project was also a showcase of urban regeneration in Turkey by exemplifying new financing provisions, as well as close relationships amongst central and local governments, large-scale private developers, and financiers (Topal et al. 2019). Topal et al. (2019) analysis of these three major urban redevelopment projects in Ankara demonstrates the relations of the state with the commodification of land, and the transition to neoliberal urban planning. In all these three examples, the state played a significant role in the provision of finance for urban redevelopment projects. The state initially relied on public banks, social security organisation, and housing cooperatives, and later on with the transition to neoliberalism more market-based mechanisms were utilised. State continued to play a significant role even after the phases of financial liberalisation, due to the lack of adequate institutionalised financing. In some redevelopment projects luxury housing were constructed as means of financing urban regeneration projects. Many of these policies resulted in gentrification of squatter and run-down areas, creating rent gaps that pushed the initial residents out of the redeveloped areas (Topal et al. 2019). Despite the undemocratic nature of the urban renewal agenda in Turkey, there are examples of grassroots resistance to the imposed redevelopments where residents mobilised to defend their right to participate. Ay (2019) analyses neighbourhood responses to urban renewal projects in three metropolitan areas of Adana, Bursa, and Izmir, with policy implications for the country’s overall urban renewal agenda. Ay outlines the inability of the centralised government institutional capacity to implement urban renewal projects at the local level. In the three case studies, although residents were not against redevelopment in principle, the top-down state-led approach resulted in confrontation of local residents with the central government. As such, Ay highlights the need for community representation in neighbourhoods as collective entities and beyond individual property owners. She believes that representation of residents as main stakeholders is a requirement for democratic urban renewal planning, that can resolve roadblocks faced in other renewal projects across Turkey (Ay 2019). Overall, despite the growing link between sustainability issues and urban regeneration in international practices, sustainability has not yet been a major motivation for urban regeneration practices in Turkey. When the Turkish experience of the past few decades is reviewed, the achievements can be summarised to the transformation of some run-down areas through general policies that can be applied anywhere, without taking into consideration the uniqueness of each case. Urban regeneration projects in Turkey failed to take a holistic approach towards the physical, social, and economic aspects of run-down urban areas. In other words, sustainability was not an explicit aim of the urban regeneration projects. Social dimensions and participation were not

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included in legal regulations. Urban regeneration projects focused on luxury housing developments that resulted in displacement of low-income residents (Korkmaz and Balaban 2020).

2.4 Urban Redevelopment in Egypt 2.4.1 Background As outlined earlier, 33 percent of the urban population in the developing world lived in informal areas in 2012, this figure was 13.3 in North African cities. In Cairo and Alexandria, two of the largest cities in Egypt, it is estimated that 40 percent of the population lived in informal settlements, which has increased since the 2011 revolution (Ragheb et al. 2016). The Greater Cairo Region alone as the largest metropolitan area in the Middle East is estimated to have a population of approximately 21 million people in 2020, which is approximately 20 percent of the total Egypt population.1 Similar to Turkey and Iran, population increase together with rural to urban influx and state’s failure to provide affordable housing caused the creation and expansion of informal settlements. In Egypt informal settlements are considered to be the main form of urbanisation, with approximately 60 percent of the population living in these areas. In the absence of proper planning and the inability to enforce housing development laws, it is estimated that between 1980 and 2025 half of the country’s agricultural land will be eradicated by urban sprawl on informal settlements. Approximately 80 percent of Egyptian informal settlements are located on agricultural land with the other 20 percent on state-owned land (Khalifa 2015). Gouda et al. (2016) in their research focused on urban sprawl in Egypt and Iran. In Egypt urban sprawl is categorised under sprawl on desert and arable lands, the latter is also very common in Iran where sprawl takes place alongside routes over agricultural land uses. Informal settlements that grow rapidly without basic services and infrastructure is a prominent type of sprawl seen in many cities. Gouda et al. highlight administrative and planning failures as the main causes of urban sprawl in the region, and demonstrate that unplanned sprawl is an intrinsic part of the Middle Eastern cities from large metropolitan areas to medium and small size cities. They concluded that excluding the wealthier states in the Middle East, their findings from urban sprawl trends in Egypt and Iran are applicable to other parts of the region. (Gouda et al. 2016) Informal settlements in Egypt began after the Second World War and accelerated during the 1960s. Following the 1952 revolution and the formation of Gamal Abdel Nasser’s socialist government, laws were issued to control rents, and the public sector assumed a significant role in housing supply. The rent control laws limited 1

https://www.macrotrends.net/cities/22812/cairo/population accessed 15 July 2021.

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the power of private property owners, and shifted the property market production from rental housing to owner-occupied housing. As a result many low-income families were pushed to informal housing. Further, during the 1960s macroeconomic shift towards industrialisation resulted in rural–urban migration and the creation of informal settlements in the urban fringe of major cities and close to major industries (Khalifa 2015). From 1967 to 1973 during the war against Israel, government investments in public housing construction went to financial resources required for military needs. Private-sector housing supply did not meet the growing demand of the low and middle classes, so they found their solution through the informal sector. Following the victory of 1973, President Anwar Sadat started the shift from a state controlled economy towards a liberal market economy and opened the economy to the West. During this period, housing policy was focused on new housing construction, and rental housing market was neglected. As the formal housing market was unaffordable for the low- and middle-income population, informal settlements again became their only affordable option. From 1981 to 2011 during President Mubarak’s governments due to the strict military measures against illegal settlements the expansion of informal settlements on agricultural land slowed down, however, the growth of existing ones continued. The January 2011 Arab Spring Revolution in Egypt focused on social justice and better living conditions, but has yet to achieve meaningful results as Egypt faced the second wave of the revolution in 2013 followed by turbulences at political, security, and economic levels (Khalifa 2015). Overall, it is estimated that 60–70 percent of the housing demand in Egypt is met through formal housing construction and the rest of the dwellings are built in the informal sector. Of the formal sector units, about 70 percent are classified as low-cost units, half of which were built under the government’s subsidised housing programme. The most common form of purchase for non-subsidised units is cash, typically with a deposit of 50 percent of the value of the unit with instalment payments extended over 3–5 years (Erbas and Nothaft 2005).

2.4.2 The State of Urban Redevelopment in Egypt The Egyptian government has adopted various policies and legislation to manage the growth of informal settlements, however, their success has been minimal. The government has taken two approaches towards these areas, first, the preventative approach in order to limit informal growth, and second, the interventionist approach, through which they have tried to improve or remove informal settlements (Ragheb et al. 2016). The latter is analysed in this section. From the early 1990s the Egyptian government started to adopt policies for upgrading informal areas. During the first stage from 1994 to 2004 the government’s programme was named Informal Settlements Development Program, which aimed at providing basic services and infrastructure. The second stage from 2004 to 2008 was named Informal Settlement Belting Program that focused on preparing

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detailed plans to restrict the growth of these areas. Both these stages lacked community participation in planning and taking into account the socioeconomic aspects of these areas. In a major move in 2008, by a presidential decree the Informal Settlement Development Facility (ISDF) was established (Khalifa 2015). Further, in 2014 the government established the Ministry of Urban Development and Informal Areas (Ragheb et al. 2016). ISDF classified informal settlements into two categories of unplanned and unsafe area, with each category requiring a different approach for intervention. Unplanned areas constituted approximately 60 percent of urban areas, while unsafe areas only constituted 1 percent of urban areas. ISDF’s policy for unplanned areas was based on market-based mechanisms through partnerships between private and public sectors. These strategies focused on unravelling concealed land values through planning regulations as well as using tax collection from developments. Unsafe areas were classified into four risk categories, and the intervention policy was devised based on the risk grade of each area. The strategy for grade one which posed the highest risk was compulsory displacement, while for grade two the strategies included in situ housing replacement or rehabilitation, and monetary compensation for improvement. Grade three strategy was mainly infrastructure improvements, and for grade four planning incentives and financing facilities were the main intervention policy (Khalifa 2015). There have also been recent radical approaches towards these informal areas. One of them was called Cairo 2050 that was devised prior to the 2011 revolution by the main urban planning entity in Egypt, the General Organization for Physical Planning. Cairo 2050 envisaged demolishing informal areas of Cairo which housed around 12 million people and replacing those areas with skyscrapers, parks, and grand boulevards. This plan that was seen by many outsiders as unfeasible was put on hold in 2014 (Bremer and Bhuiyan 2014). There were other parallel initiatives to the government’s efforts in upgrading informal areas by donor agencies, civil society organisations, and private sector. Some examples include the 100-Schools project developed by an NGO sponsored by Mrs. Mubarak that aimed at upgrading schools in informal settlements, or the upgrading of youth centres by the Coca Cola Company. Another NGO project that received the Council of Arab Ministers for Housing and Reconstruction Award in 2000 constructed 70,000 dwelling units in urban poor areas. There was also a joint initiative between the Egyptian Ministry of Planning and the German Development Cooperation advocating the concept of community participation in urban upgrading projects. This project started in 2004 and in 2015 was in its third phase (Khalifa 2015). Nevertheless, collaborative urban development approaches is a new phenomenon in Egypt, and the governments have had mixed approaches towards them. However, there has been bottom-up community-led efforts in informal areas. Bermer and Bhuiyan (2014) analysed community efforts in one of Cairo’s largest informal areas to upgrade infrastructure services in their neighbourhood. Community efforts included self-funding strategies and collaboration with the local administration. They outline how integrating grass root public–private partnerships can advance sustainable development in informal areas in Egypt and other developing countries. They

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call for greater regulatory flexibility, incorporating these models into the regularisation process to allow them to flourish. Highlighting that when self-help partnerships have been found successful in developed countries’ context such as rural United States, then cash strapped developing country governments should make the most of these resources by mobilising them in upgrading run-down areas (Bremer and Bhuiyan 2014).

2.5 Conclusions This chapter analysed the urban development and redevelopment processes in developing countries and the Middle East prior to focusing on Iran and Tehran. Parnell and Robinson (2012) research highlighted the importance of the urban theories that stem from the developing countries and the global South, where the majority of the world’s urban population resides. As such, this chapter highlighted the cultural, socioeconomic, and political issues that exist in the context of developing countries and the Middle East in order to inform the analytical aspects of the case study chapters. Based on the institutionalist approaches and structure and agency framework of analysis that was discussed in the previous chapter, this chapter outlined the structural component of urban development processes in the developing world and the Middle East. Property markets and market-enabling strategies were discussed in the context of developing countries, and the potential shortcomings and complex relationships between actors were outlined based on the work of Keivani and Werna (2001a, b). The balance between regulation and deregulation as outlined by Mukhija (2004) is key within this context, which will be discussed further through the case studies. This discussion was elaborated in this chapter through different modes of housing provision in developing countries with relation to the redevelopment models of this research, as well as the role of government and importance of the informal sector in housing provision. Within the developing world context, the Middle Eastern cities have many similar characteristics that differentiates them from other developing world cities. Rapid population growth coupled with the state’s inability to implement development regulations have resulted in vast informal urban areas throughout the Middle East without access to basic infrastructure. In most Middle Eastern countries a large gap between housing supply and demand exist, and demographic characteristics indicate that housing demand will remain high for the next few decades. In order to respond to this rapid growth, urban planning has been more focused on the built environment and physical aspects of land use. Dealing with rapid growth of cities, developing stronger planning institutions, taking a more holistic approach and incorporating public consultation in the planning processes are the main challenges facing urban planners in the Middle East. This chapter looked more closely at the conditions in Turkey and Egypt as the two other largest countries in the Middle East with a track record of urban redevelopment

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projects. In both these countries similar to Iran, population growth together with rural to urban influx and state’s failure to provide affordable housing caused the creation and expansion of informal areas. Governments adopted various policies to manage the growth of informal settlements and tried to transform them in the past few decades. Each country experienced unique planning, political, and societal trends that affected their urban redevelopment process. Istanbul and Ankara experienced radical stateled transformations, while there have also been radical approaches towards informal areas in Cairo (such as Cairo 2050). In many instances, urban regeneration projects focused on luxury housing developments that resulted in displacement of low-income residents. Overall, urban regeneration projects’ success was minimal and failed to take a holistic approach towards the physical, social, and economic aspects of rundown urban areas. Social dimensions and participation were not included in legal regulations, and collaborative urban development approaches is a new phenomenon in Turkey and Egypt. As outlined above, the importance of the informal sector in housing provision needs to be recognised in the developing world and Middle Eastern context. Further, the right balance between regulation and deregulation should be sought to tackle the growing housing demand and decay problems in the Middle Eastern cities.

References Al-Hathloul S (2004) Planning in the Middle East, moving toward the future. Habitat Int 28:641–643 Asgari A et al (2008) Determining the structural / building factors in vulnerability of old urban fabric of Zanjan using GIS and fuzzy logic. Fine Arts Academ J 33:27–36. in Persian Ay D (2019) Diverging community responses to state-led urban renewal in the context of recentralization of planning authority: an analysis of three urban renewal projects in Turkey. Habitat Int 91(2019):102028. Bremer J, Bhuiyan SH (2014) Community-led infrastructure development in informal areas in urban Egypt: a case study. Habitat Int 44:258–267 Erbas SN, Nothaft FE (2005) Mortgage markets in Middle East and North African countries: market development, poverty reduction, and growth. J Hous Econ 14:212–241 Gouda A et al (2016) The status of urban and suburban sprawl in Egypt and Iran. GeoScape 10(1):1–15 Gundogdu I, Gouth J (2009) Class cleansing in Istanbul’s world-city project in whose urban renaissance? An International comparison of urban regeneration strategies (Ed: Porter L, Shaw K). Routledge, Abingdon Healey P, Barret S (1990) Structure and agency in land and property development process: some ideas for research. Urban Stud 27:89–104 Keivani R, Werna E (2001a) Modes of housing provision in developing countries. Prog Plan 55:65– 118 Keivani R, Werna E (2001b) Refocusing the housing debate in developing countries from a pluralist perspective. Habitat Int 25:191–208 Khalifa M (2015) Evolution of informal settlements upgrading strategies in Egypt: from negligence to participatory development. Ain Shams Eng J 6(4):1151–1159 Korkmaz C, Balaban O (2020) Sustainability of urban regeneration in Turkey: assessing the performance of the North Ankara Urban Regeneration Project. Habitat Int 95:102081

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Kuyucu T (2018) Politics of urban regeneration in Turkey: possibilities and limits of municipal regeneration initiatives in a highly centralized country. Urban Geogr 39(8):1152–1176 Kuyucu T, Unsal O (2010) “Urban transformation” as state-led property transfer: an analysis of two cases of urban renewal in Istanbul. Urban Stud 47(7):1479–1499 Madanipour A (1998) Tehran: the making of a metropolis. Wiley, West Sussex, England Masoumi HE et al (2019) Neighborhood-scale urban form typologies of large metropolitan areas: observations on Istanbul, Cairo, and Tehran. Cities 85:170–186 Mukhija V (2001) Enabling slum redevelopment in Mumbai: policy paradox in practice. Hous Stud 16(6):791–806 Mukhija V (2004) The contradictions in enabling private developers of affordable housing: a cautionary case from Ahmedabad, India. Urban Stud 41(11):2231–2244 Ozcevik O et al (2010) Buidling capacity through collaborative local action: case of Matra REGIMA within Zeytinburu regeneration scheme. J Urban Plan Dev 136:169–175 Parnell S, Robinson J (2012) (Re)theorizing cities from the global South: looking beyond neoliberalism. Urban Geogr 33:593–617 Rabbiosi C, Coletti R, Salone C (2021) Introduction to the special issue: between practices and policies. Rethinking urban regeneration in Southern European cities after the crisis. Urban Res Pract 14:3, 217–222 Ragheb GH et al ( 2016) Land for poor: towards sustainable master plan for sensitive redevelopment of slums. Procedia—Soc Behav Sci 216:417–427 Tarh o Amayesh Consultants (2003) Barresi masael tose shahri mantaghe 15 (analysis of district 15 urban development issues). Tehran Topal A, Yalman G, Çelik O (2019) Changing modalities of urban redevelopment and housing finance in Turkey: three mass housing projects in Ankara. J Urban Aff 41(5):630–653 World Bank (1993) Housing: enabling markets to work. World Bank, Washington, DC Zebardast E (2006) Marginalization of the urban poor and the expansion of the spontaneous settlements on the Tehran metropolitan fringe. Cities 23(6):439–454

Chapter 3

Urban Development in Iran and Tehran

Abstract This chapter discusses the urban regeneration and development processes in Iran and Tehran prior to the following case study chapters. Urban development in Iran is discussed with a focus on the housing and development sectors as well as the urban policies that have shaped Iranian cities in the past few decades. The focus is then placed on urban development in Tehran, outlining the city’s formation, its rapid expansion, and its current spatial structure. Further, the development industry in Tehran is analysed through discussions on the property market’s behaviour, various types of developers that operate, and the current housing conditions. Finally, urban management and regeneration policies in Tehran are discussed, and previous unsuccessful regeneration experiences are outlined. Keywords Urban development in Iran · Urban redevelopment in Tehran · Housing development in Tehran · Small-scale developers · Urban land policy

3.1 Urban Development in Iran This section discusses the urban development in Iran in order to provide a better understanding of the structure of housing development and policies in the Iranian context. The first section discusses the housing and urban development sector in Iran, and the second section discusses the urban land policies in Iran as one of the major urban development policies of the Iranian governments.

3.1.1 Housing and Development Sector in Iran The housing sector was equivalent to 7.7% of GDP in 2020, and the property professional services sector equivalent to 12.3%, together they comprised approximately 30% of GDP in 2020 (Central Bank of Iran 2021). The housing sector’s economic significance is also critical once its employment creation potential is

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realised. Between 2006 and 2016, employment in the construction sector was 11.4– 15.5% of Iran’s total working population, employing over 3 million people (Farahzadi 2019). As such, the Iranian government places a special emphasis on housing production, and in the government’s Five-Year Development Plans,1 significant investment is allocated to housing production. By doing so, the government mainly supports developers for mass production of housing, with the objective of providing smaller accommodation for the low-income groups. The government attempts to achieve this strategy by providing a large share of housing finance to mass housing developers (World Bank 2004). Madanipour (1998), in his book about Tehran, highlights that the reasons why the government encourages the development and construction industry are twofold. First, growth in this sector—for example, infrastructure and housing—is perceived as a precondition for development in other sectors of the economy. Second, it seems easier to develop this sector in comparison to manufacturing industry and agriculture. The construction industry is directly related to, and has an impact on, the national economy, and periods of boom and recession have been very similar between the two, with an occasional one-year lag. This indicates the sector’s impact on the country’s economy, its sensitivity to oil revenue, and its economic instability. Moreover, the construction sector has an important impact on other sectors by generating income and increasing demand for goods and services (Madanipour 1998). Within the construction industry, housing dominates private-sector investment, with public investment being dominant in most other construction activities, e.g., infrastructure, public buildings, and facilities. However, Madanipour highlights that these projects are initiated by the government in times of political stability and economic prosperity. Politically destabilising events have decreased the investment in the built environment by both the public and private sectors, and the stable periods have seen a major increase in this production. Oil prices have also had a major impact on these cycles. Therefore, the urban landscape of Tehran is clearly a product of cycles of boom and bust, which is a clear characteristic of market economies (Madanipour 1998). The volatile land and real estate market in Iran could be attributed to the high and volatile inflation as well as the weak purchasing power of the general population (World Bank 2004). Inflation rate ranged between 10 and 40% in the past two decades, with 2021 recording one of the highest inflations at 39.3% (IMF 2021). 2021 saw house prices in Tehran increase by 80% and rents by 40% year over year (The World Bank 2021). Iran’s housing stock was equivalent to 295 units per 1,000 residents in the 2016 census. Total number of housing units in urban areas were 17,452,066, which lags behind the 18,117,742 households (Statistical Centre of Iran 2016). The urban–rural migration and population growth puts additional pressure on the cities’ limited housing stock. 1

Iran’s government outlines its national economic policies through Five-Year Development Plans (FYDP). The first post-revolutionary FYDP was approved after the Iran–Iraq War in 1990, in 2021 the government is implementing the sixth post-revolutionary FYDP (see Curtis, G., and Hooglund, E. [eds.] [2008], pp. 73–74 for further detail).

3.1 Urban Development in Iran

43

The 2005 World Bank report compared the Iranian housing sector to some other Middle Eastern economies, and the report concludes that the housing demand in Iran is expected to grow rapidly due to the anticipated growth in population, urbanisation, income, and the treatment of housing as an asset (World Bank 2005). As such, if the supply of housing fails to increase at the same pace with this anticipated demand, the gap between housing supply and demand in Iran would become even greater. Inflation and an underdeveloped finance system have turned housing into one of the preferred assets for household investment in Iran. A similar trend can be seen in some other oil economies in the Middle East, with housing acting as an “asset of refuge” (World Bank 2005). In Iran, this trend has resulted in a speculative housing market and has increased its relationship with other assets like gold, foreign currencies, and stocks. As such, house prices are linked to some extent to the performance of other markets. For example, the Iranian government policies in the 1990s with regard to strict controls on foreign exchange led to increased investment in the housing market (World Bank 2004). Further, Iran experiences a highly segmented housing market. The World Bank (2004) report demonstrates that 60% of the new housing supply can only be afforded by the top 20% of the income groups, while the bottom 40% of the income groups can only afford 8% of the new housing supply. This highlights the significant affordability issue that exists in the Iranian housing market. The house-price-to-income ratio in Tehran is around eight, while other countries in the Middle East and North Africa, like Lebanon and Morocco, experience similar ratios, this ratio in balanced markets is four or less (World Bank 2005). The Iranian housing market is supported by a significant regime of housing subsidies, which approximately constitutes 4–5% of the GDP. Utility subsidies constitute the greatest portion of the government subsidies. The other subsidies are directed at special groups (usually the low-income population) and pertain to interest rate caps for housing finance, land allocation at submarket prices, and in some places direct government housing provision. However, these subsidies seem inefficient and not well targeted to those most in need, and as such the government’s investment is not effectively utilised (The World Bank 2010). The Iranian housing finance system is underdeveloped, with the majority of the finances controlled by the Housing Bank of Iran (Bank Maskan), which is a publicsector bank. Long-term housing loans in Iran constitute approximately 3% of the GDP, which is low by international standards; for example, this figure is more than 50% in the United States. Further, only 40% of this housing finance is for long-term purchase finance, and 60% is allocated to long-term construction credits. There are challenges for developing the long-term housing finance system in Iran, including the absence of financial market infrastructure and appropriate legal frameworks. Most significantly, the high and volatile inflation in the Iranian economy makes developing a long-term housing finance system challenging. The loan-to-value ratio for housing in Tehran is approximately 30%, which makes it very difficult for households to provide the remaining 70%, and as a result worsens the affordability problem. In order to provide the remaining value of a house, households tend to rely on sales

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of other assets, financing by relatives, employer loans, and informal markets (World Bank 2004). The most important problem of social housing programmes in Iran was the lack of financial credits and its high interest rates (Sarvari et al. 2021). With regard to the Iranian housing construction industry, the World Bank highlights that this industry is dominated by the private sector. There is a significant publicsector involvement in production of essential construction materials, including steel and cement. The majority of construction materials are produced domestically, and only some electronic materials are imported. The World Bank mentions that the Iranian construction industry is developed enough to support housing market growth, namely because numerous companies comprise this sector, there are appropriate laws and regulations in place, and construction materials and labour are readily available to support growth (World Bank 2004). However, the major problem in housing construction is the vulnerability of the old housing stock to earthquakes and other natural disasters; hence the focus of this research is on physical regeneration of run-down areas. The World Bank (2004) reported that between 1993 and 2001 approximately 600,000 dwellings were damaged by natural disasters. The World Bank report in 2010 mentioned that on average each year, 1% of the housing stock in Iran was destroyed by earthquakes, which cost the economy 1.3% of the GDP. With the introduction of the new building codes there has been a departure from traditional masonry construction, and the durability of the new housing supply has significantly improved, with the majority of buildings utilising steel and concrete structures (The World Bank 2010). Finally, World Bank (2004), in its recommendations for housing market reforms in Iran, highlights the need for better coordination between various government agencies that are involved in the housing sector and urban development. They also highlight that the current centralised decision-making process needs to change in order to further empower the local government agencies. In the current model, the government oil revenues are distributed in the economy through a centralised and top-down framework, which is the basis of the economic structure of Iran. Table 3.1 illustrates the various organisations that are responsible for social and economic infrastructure related to urban development. As can be seen in the table, significant coordination is required between numerous government agencies for urban development projects. This can prove more challenging in urban regeneration projects, where there is existing infrastructure in place and various stakeholders are involved.

3.1.2 Urban Land Policies in Iran Urban land policies were fundamental government instruments for development in Iran, both before and after the revolution of 1979. Further to Healey and Barret’s (1990) discussion with regards to the importance of the structure and agency approach in urban development processes, the following section, mainly based on the work of Lowder (1993), places the major government land policies in Iran in the context of

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Table 3.1 Agencies responsible for urban development in Iran Infrastructure

Agency responsible

Schools

Ministry of Education

Universities

Ministry of Science, Research, and Technology

Health centres and hospitals

Ministry of Health

Roads and sidewalks

Municipality

Water and sewage networks

Water and Sewage Organisation

Street lighting and electrical networks Electrical Power Organisation Parks

Municipality

Libraries

Municipality/Ministry of Culture and Islamic Guidance

Cultural and arts centres

Municipality

Source Table created by the author with information from the World Bank (2010)

the political events and social conditions that led to those policies before and after the Iranian Revolution. The next section discusses the benefits and drawbacks of these major government policies on the ground based on the work of Azizi (1998) and Keivani et al. (2008).

3.1.2.1

History and Context of Land Policies in Iran

Land ownership in Iran has historically been a sign of social prestige, and landownership has been a means of political control, until the Shah’s agrarian reform of 1962. The 1962 land reform in Iran was designed to transform land from major landowners to peasants. However, as the peasants were unable to operate the land on their own, it resulted in unviable farms and displacement of the rural population. It created a wave of migration from villages to cities in pursuit of employment opportunities, but many of these unskilled villagers were unable to find work in cities and as such became poor urban residents. This migration to major cities continued after the revolution, but this time was mainly fuelled by Khomeini’s promise to provide housing for the poor, which encouraged villagers and residents of smaller towns to move to the major cities. Lowder states that the grandiose visions of the shah and his rush to modernity and westernisation led to significant investment in the construction industry. This resulted in accumulation of wealth by some, mainly in the major cities, while at the same time it resulted in the decay of rural economies, which sustained large parts of Iranian society. There was a visible infrastructural investment division during the shah’s reign, not only in the major cities compared to the smaller cities but also in the higher-end neighbourhoods compared to lower-income areas; which resulted in increasing the gap between the rich and poor (Lowder 1993). These inequalities, coupled with the rapid secularisation of a traditional society, were major contributors to the Iranian Revolution of 1979. That land development was more than an urban problem in Iran and was related to the ideals of the revolution

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in trying to provide housing for the poor. Lowder states that, in the Iranian situation, during uncertain times land proved to be a safer investment compared to production and cash, while during periods of boom it provided lucrative returns. As such, people bought land speculatively in the periphery of the major towns in the hope of selling at a higher price once industrial or residential activities started to occur in these areas. These absentee landlords left these lands undeveloped, so it could be easily disposed. Another factor that contributed to extensive areas of underutilised land is the inheritance laws in Iran. Based on these laws, land is distributed between the children of the owner, and if the multiple inheritors cannot agree over its fate, the land becomes abandoned. As such, Iranian cities are surrounded by vacant properties, where either the owners cannot be found or they cannot agree on the fate of the land (Lowder 1993). The situation of vacant lands surrounding the cities, as well as the need to provide housing for the poor, led to public land ownership and land development policies, which became amongst the fundamental development policies of the Iranian government after the revolution. Several land laws were passed by the Iranian Parliament after the revolution that facilitated public land ownership and land expropriation by the government. In 1979, the Urban Wasteland Ownership Abolition Law was passed, under which all urban wasteland over 1,000 square metres came under public ownership. Then, in 1982, the Urban Land Law was passed for a period of five years, under which the Urban Land Organisation (a governmental organisation for land supply) could expropriate unused land. Following this five-year period, a revision of the previous law was passed as the New Urban Land Law in 19872 (Azizi 1998). Under Article 31 of the post-revolution constitution, every Iranian individual has the right to a decent home. As such, the urban land policies were an attempt by the post-revolutionary government to provide land for housing and limit land speculation. In the ten-year period between 1982 and 1992, 329,952 hectares of land were acquired, and more than 17,044 hectares of net residential land were provided to applicants. Within this process the state built a very small proportion of the housing, with the majority of land being distributed to individual households and cooperatives (Azizi 1998).

3.1.2.2

Implementation of Land Policies in Iran

The land policies outlined in the previous section were mainly aimed at the lowincome population, in line with the promise of the revolution in its commitment to the masses. Further, private land ownership was an obstacle to implementation of large urban development plans; as such, public land ownership paved the way for these plans and also land provision for services such as schools, administrative

2

The urban land policies were further updated in the following years. In 1992, the Land Acquisition Law further regulated the acquisition of land, and in 2002, the Residential Land Use Law further regulated the use of residential land (see Keivani et al. 2008 for more detail on these laws).

3.1 Urban Development in Iran

47

buildings, parks, and open spaces was made possible under these new laws (Azizi 1998). The government utilised various policies to provide low-income housing during the past few decades. Providing land to individuals or housing cooperatives or providing financial support to builders to provide low-income housing were widely used approaches. Similar to other developing countries, rental housing provision has received little attention in Iran (Sarvari et al. 2021). Policies in providing a residential land were largely successful. Following the revolution of 1979 for a period of ten years until 1989 (when the first national Five-Year Plan was implemented), the Urban Land Organisation provided approximately 50% of the land for housing construction in urban areas. Further, these policies and public land ownership controlled land prices to a great extent. In his research, Azizi demonstrates that the land price increases in many Iranian cities were far less than the housing price increases over the same period (Azizi 1998). Keivani et al. (2008) highlight that between 1979 and 1989, the Iranian government played an effective role in low- to middle-income housing provision by bypassing the urban land housing markets. As such, they suggest that in addition to the World Bank’s approach of enabling markets in developing countries, government land banking can play an effective role in providing cheap land, which can then be developed for housing by households, cooperatives, or private developers. They demonstrate that the public management of land had a significant impact on land prices in Iran between 1979 and 1989; as such, government land policies managed to keep the total constant land prices relatively stable over this period (Keivani et al. 2008). Lowder (1993), by analysing the impact of government land policies in the medium-size city of Ahwaz in Iran, demonstrates that the really poor urban population was left out of the process of land distribution. She attributes this to the government requirements for building housing on the distributed land. Applicants either had to self-build their housing, which the very poor did not have sufficient resources to do so, or the applicants had to be part of a cooperative, and as these cooperatives were mainly formed through employers, those without formal employment were left out of the process (Lowder 1993). Although these policies achieved many of their objectives in controlling land prices and providing housing for many low-income citizens, the implementation of these new laws created numerous problems, especially in the early years. Most significantly, these policies resulted in rapid urban expansion. The majority of the acquired land was outside the city boundaries and as such was not part of the city master plans. It created poorly planned areas without proper master planning, and in many cases master planning was only done at the conceptual stage; as such, the absence of detailed urban plans created areas with numerous deficiencies. Further, until 1985, the Urban Land Organisation was only responsible for land distribution, and infrastructure provision was not seriously considered. As such, these areas had significant infrastructure problems, where the infrastructure was low quality and was provided with significant delays. Starting in 1985 the Urban Land Organisation revised their policy and also provided infrastructure, utilising a system whereby

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households had to contribute to the cost of infrastructure at a lower-than-market rate (Azizi 1998). A major housing provision policy in the more recent years that was part of the fourth and fifth national development plans was Mehr Housing. Mehr Housing used public lands in the outskirts of the cities to provide housing for low-income households. Due to remote locations and infrastructure expenses Mehr Housing received much criticism. It also resulted in increased transportation and commuting expenses for low-income households (Sarvari et al. 2021). Lack of coherent planning was a major shortcoming of urban land supply policies. The distribution of land, especially in the early years, was not based on the housing needs of the cities, rather it was based on land availability. For example, large cities like Tehran and other major cities, which had significant housing problems but lower land availability, saw fewer projects compared to smaller cities with less significant housing problems but greater availability of vacant land. Further, these land policies were developed in isolation from other policies both at the urban and national levels. At the urban level they were not developed in harmony with the cities’ master plans, and at the national level they were at odds with the general housing demands and housing construction trends. Land wastage was another shortcoming of these policies, as almost all Urban Land Organisation land was planned for single-storey houses, which can be considered land wastage, especially in cities with significant land shortage (Azizi 1998).

3.2 Urban Development in Tehran 3.2.1 Tehran’s Formation Outlining how Tehran has transformed from a small village in the eighteenth century to the thirteen-million-people metropolis of today requires extensive explanation. Here, however, is a snapshot of the pivotal events that have had impacts on the transformation of this metropolis and its urban policies to date. The map in Fig. 3.1 illustrates the growth of Tehran from 1891 to 1996. Although this map highlights the two-dimensional expansion of Tehran, the density of Tehran, like that of many other major cities, has decreased throughout the years. Tehran’s density decreased from greater than three hundred people per hectare in 1900 to the current level of 146 people per hectare. Although many high-rise buildings have been built in recent years, this decrease in density can be attributed to the massive car-oriented expansion of Tehran (Bertaud 2003). Tehran became the capital of Iran in 1795 with the start of the Qajar dynasty’s reign. They declared a new capital in order to demonstrate their authority. However, it was not until the premiership of Amir Kabir in 1848 that Tehran took a major step in its development. This happened with the establishment of new public institutions like

3.2 Urban Development in Tehran

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Fig. 3.1 Historical development of Tehran, 1891–1996 (Source Bertaud [2003] with permission from the author)

Dar ul-Funun (the first modern institution for higher learning) and Tehran’s government hospital, and a few public projects like renovation of the shops on Naseryeh Street took place (Diba et al. 2007). It was during the first half of the twentieth century that the first major urban intervention policies materialised within the city boundaries of Iranian cities. They occurred between the years of 1921 and 1941 (1300–1320), during the reign of Reza Shah Pahlavi. Reza Shah, with his autocratic way of ruling, managed to achieve many of his visions and his desires for modernity. This was at the time when the first city law (Ghanoon-e Baladieh) passed in 1930 (1309) and as a result paved the way for many urban interventions. It included construction of new roads like Boozarjomehri and Khayam, which as a result changed the urban structure of their respective neighbourhoods (Azizi 2000). The rush to modernity followed under Mohammad Reza Shah, with numerous ambitious urban projects taking place during his rule. The latest of these was Shahestan Pahlavi, which started in the mid-1970s, but with the coming of the Islamic Revolution of 1979 it never materialised. After the Islamic revolution, the development boom of the prerevolution years slowed down, and in its place numerous political events had major impacts on the social and economic structure of Iranian cities. Starting with the revolution in the 1970s, and followed by the war with Iraq in the 1980s, Iranian cities faced major

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social and economic restructuring. The residents of the war-hit cities in the western provinces moved to other major cities, and the war in Afghanistan also brought millions of refugees to Iran who started working in low-paying jobs and construction work. This highlights some of the difficult situations faced in many Iranian cities, and how the social geography of many Iranian cities has been shaped in the past few decades (Modarres 2006).

3.2.2 Rapid Urban Expansion in Tehran One of the major characteristics of Iranian cities is the enormous expansion that they have experienced after the Islamic revolution. The consequences of such a rapid urbanisation rate can be seen in many aspects of how cities are shaped and function. After the Iranian revolution, for the first time, the urban population passed the 50% threshold, with more people living in cities than villages. This urban expansion happened mainly in the major cities, with the capital city Tehran leading the way. On the one hand, the high poverty in rural areas and unemployment were the major causes for this. On the other hand, major cities had far more attractions compared to the smaller towns. This unplanned expansion, coupled with no major investment in infrastructure, resulted in more inequality within the cities. It increased the congestion in the already overstretched infrastructure by putting more pressure on the water supply, traffic jams, and social welfare (Fanni 2006). This rapid expansion, which resulted in social and economic neglect within the cities, accompanied by the lack of supervision and lax policies, was the major reason behind the creation of run-down areas to the extent that is seen today. Table 3.2 shows the meteoric rise in Tehran population from 1966 to 2016. The new immigrants, many of whom were unemployed villagers or people from smaller towns, inhabited the city’s outskirts or run-down areas. Many are the current residents of run-down areas (look at case analysis for further detail in this chapter and Chap. 4), some came forty years ago and inhabited the outskirts (which are now part of the city with the city’s expansion), and some in more recent years either rented or purchased units in these areas. In the lower-quality neighbourhoods (like Khoob-Bakht) there are also immigrants from surrounding countries like Iraq and Afghanistan (Fanni 2006). This urbanisation in Iran resulted in literacy rates of around 80% and a life expectancy rate that goes beyond seventy years. Nevertheless, the rapid rate of urbanisation has had many pitfalls, and as Modarres outlines: “Inadequate housing, unemployment, a large rural to urban migration, class-based segregation patterns, Table 3.2 Population increase in the Tehran (National Census 2016) Year

1966

1976

1986

1991

1996

2011

2016

Population 2,719,730 4,530,223 6,058,207 6,497,238 6,758,845 7,711,230 8,737,510

3.2 Urban Development in Tehran

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gender inequities, traffic jams, inadequate service delivery in specific places, and an overall worsening of urban environmental conditions” (Modarres 2006, p. 405) are a few examples. This rapid growth has also resulted in dire employment conditions in cities like Tehran, “when we consider the fact that a significant number of employed are in low-paying service jobs, forcing some to work at multiple jobs to meet the financial demands of everyday life in Iranian cities. These unfavourable employment conditions (i.e., unemployment and under-employment) negatively affect access to housing and education, as well as health services” (Modarres 2006, p. 405).

3.2.2.1

Rapid Urbanisation and the Resultant Spontaneous Settlements and Run-Down Areas in Tehran

Another major implication of this dramatic urban expansion is the rapid emergence of spontaneous settlements and also low-quality settlements that turn into run-down areas in a matter of a few years, which is the focus of this research (see Fig. 3.2). Zebardast (2006) researched the spontaneous settlements in the Tehran metropolitan fringe and found that these settlements were not only for accommodating the rural–urban migration but were also serving the urban residents who cannot afford to live in the city. The main reasons for people to live in these areas was, first, access to affordable housing and, second, proximity to work. Seventy percent of those employed were working in the informal sector. In terms of home ownership,

Fig. 3.2 Map of Tehran’s deteriorated areas (Source Tehran Master Plan [2006] with permission)

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24% were renting their place, and 62% owned their house; from these homeowners, 57% bought their land through local private housing agencies and 40% bought it directly from landowners (Zebardast 2006). Zebardast blames the failure of three factors in government policies for the extent of these spontaneous settlements. First, the urban planning system, where the rigidity of the system failed to adapt to the fast demographic changes in the cities. Second, the urban land policies, the major one of which was through allocation of land to housing cooperatives to build low-income housing for their employees (which were mainly through employment in the public sector), but since many of the urban poor in the metropolitan fringe were employed in the informal sector, they were not part of any cooperative to be provided with housing (look at Keivani et al. 2008 for more detail). Third, housing policies, which have mainly to do with the lack of housing finance to support families in purchasing their homes. In Iran the total value of housing loans only includes the comparatively very low amount of 3% of the GDP. Therefore, Zebardast blames the government policies for this phenomenon (Zebardast 2006). The same government policies have also resulted in the extent of run-down areas that Tehran is experiencing. He believes that the formation and expansion of these types of spontaneous settlements is the response of the urban poor, who had been left out of the urban planning system and were forced to plan for themselves. He concludes that, where the formal housing markets within the cities were not responding to their needs, they found affordable land in the periphery of the cities through the informal land market (Zebardast 2006).

3.2.3 Spatial Structure of Tehran Prior to discussing urban issues at the neighbourhood scale and analysing regeneration projects, it is important to put these neighbourhoods into the city’s context on a larger scale. As such, this section looks at the spatial structure of Tehran in order to give a better understanding of how the city functions on a large scale. Bertaud (2003), in a report for the Ministry of Housing and Urban Development of Iran, analyses the spatial structure of Tehran. Although most of his data is from 2002, the general structural trends and patterns of the city that Bertaud illustrates are still valid to date. He bases his analysis on spatial distribution of population, land consumption per person, land price configuration, and the pattern of daily trips in the city. Tehran, with a density of 146 people per hectare (pph), is amongst the world’s densest cities. Major European cities like London and Paris each have densities of 62 pph and 88 pph, respectively, while Barcelona has a density of 168 pph. On the other hand, major Asian cities have significantly greater densities; for example, Shanghai and Mumbai have densities of 282 pph and 389 pph, respectively, and are the world’s densest cities (Bertaud 2003). Further, the average residential floor area per capita is 25.5 square metres per person in Tehran and 27.4 in national urban areas of Iran (Zebardast 2009). These floor area levels are comparable to

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Fig. 3.3 Tehran’s density and land price profile based on distance from the centre (Source Bertaud [2003] with permission from the author)

many advanced economies with income levels significantly higher than Iran. Bertaud (2003) attributes this high per capita floor area to the high priority of housing in the Iranian household budget and the government policies for increasing the floor area ratios in many cities (Bertaud 2003). With respect to the spatial distribution of the population, Bertaud (2003) describes Tehran’s spatial structure as a high-density city without a major CBD3 and a mildly polycentric structure. Absence of a clear CBD is mainly a characteristic of cities with lower densities, and thus the case of Tehran is unique for a city with such a high density. Further, this city structure is not culturally relevant to Iranian cities, given that the Iranian cities historically had traditional bazaars at their core, where a concentration of activities occurred (see Tavasoli 2002 for further detail). Figure 3.3 illustrates the density profile of Tehran in relation to land prices. The trend confirms the lack of a strong CBD; the density increases by moving away from the centre of Tehran and reaches its maximum approximately 6 kms away from the centre; it decreases as it gets closer to the peripheries. Further, the red line corresponding to the land price trend in Tehran illustrates that land prices increase by moving away from the centre. Tehran is an unorthodox case: first, in most cities prices decreases by moving away from the centre, and second, there is generally a 3

Central Business District.

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Fig. 3.4 Spatial distribution of land prices in Tehran, 2002 (Source Bertaud [2003] with permission from the author)

direct correlation between land prices and density. But in Tehran these two move in opposite directions (Bertaud 2003). Figure 3.4 illustrates the geographical distribution of land prices based on Tehran’s districts and reiterates the major social segregation that exists in Tehran. The map confirms the earlier discussion with respect to land price distribution and illustrates the clear north–south divide in Tehran. Bertaud attributes this pattern to the better environmental quality of the northern districts. These areas are closer to the mountains surrounding Tehran, and as such they are located at a higher attitude, have a better climate, and less air pollution. The map clearly illustrates the significant social segregation that exists in Tehran. The household expenditure and floor space per capita are, respectively, three and four times higher in the northern districts compared to the southern districts (Bertaud 2003, p. 10). While Tehran Municipality does not have a clear policy for social integration, in contrast to the prerevolution years, the post-revolution government has a tendency to invest more in the impoverished areas of Tehran. Figure 3.5 illustrates the trend of population change in different districts of Tehran since 1976 (3 years before the revolution), with Fig. 3.6 highlighting this trend by geographical regions of Tehran. The maps illustrates that while the northern and northwestern districts absorbed new population to a great extent (approximately 2.5 million people), central Tehran experienced a negative population trend while

3.2 Urban Development in Tehran

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Fig. 3.5 Tehran districts average population growth/decline per year between 1976 and 2016 by district (Source Map created by author with data from Iran Census Organization, National Census [2016]. Note Numbers in each district represents population growth between 1976 and 2016. Population growth of district 21 is calculated between 1986 and 2016)

Fig. 3.6 Tehran regions average population growth/decline per year between 1976 and 2016 by region (Source Map created by author with data from Iran Census Organization, National Census [2016]. Note Numbers in each district represents population growth between 1976 and 2016. Population growth of district 21 is calculated between 1986 and 2016)

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southern districts experienced minimal growth. Once this map is compared to the map of deteriorated areas of Tehran (Fig. 3.2), there is a major overlap between the areas that have a negative population trend and deteriorated areas. This demonstrates that residents abandon deteriorated areas and move to the other parts of the city and underscores the need for regeneration in these areas. Although Tehran does not have a strong CBD, District 6 and District 12 have some of the characteristics of a CBD. These two districts together attracted 27% of all vehicular shopping trips and 30% of all employment commutes in Tehran in 2002. However, this is only 2.7 times greater than the citywide average of 5% of trips. Districts 10 and 15, where the two cases studies of this research are located, received 3 and 4% of the citywide vehicular shopping trips, respectively, and 2 and 4% of employment commutes. This highlights their dominant residential characteristic and lower than average retail and employment activities (Bertaud 2003).

3.3 Development Industry in Tehran This section looks at the development industry in Tehran. First, the housing development industry in the context of Tehran and the rising land prices are outlined. The following section looks at small-scale versus large-scale developers operating in Tehran, and the final section discusses the type of housing that is produced and housing indicators.

3.3.1 Housing Development and Rising Land Prices in Tehran As highlighted earlier, the development and construction sector is a critical part of Iran’s economy, and within construction, housing dominates the private-sector investment. Public investment is dominant in most other construction activities, for example, infrastructure, public buildings, and facilities. The reason why housing construction has constituted the major share of private investment is because of its high returns and immediate utility. Within housing, development for own use and small-scale development has had the major share of private investment. As the housing industry is getting more integrated into the market and more specialised, development for sale has increased. However, the fact that development for own use constitutes the major part of investment does not imply that housing is not considered a commodity, as eventually they are all meant for sale. However, this extensiveness of development for own use signifies the inability of the construction industry and the banking system to deal with the growing demand for housing. Madanipour (1998), in his book about Tehran, highlights that the proportion of development for sale grew until the mid-1970s. In 1975 in Tehran, 54.5% of

3.3 Development Industry in Tehran

57

completed dwellings were for own use, 39.7% for sale, and 5.8% for rent. The growing share of development for sale was due to the availability of finance and the increase in the size of firms, and it signifies the growing dominance of financiers that resulted in mass production of housing. This process of capital accumulation by large firms was stopped by the revolution of 1979, which distrusted these large firms. After the revolution they encouraged wealth distribution and home ownership through small firms and housing cooperatives. The figures in 1986 show that 64.9% of dwellings in Tehran were owner occupied and 22.8% were rented. Development for sale dropped during the Iran–Iraq War in the 1980s, but as the situation got back to normal in the 1990s, the development for sale grew again (Madanipour 1998). In Iran’s high inflation economy, in which the price of urban land has almost always been rising, property has been one of the most secure forms of investment for individuals. Therefore, development for own use has been seen as an investment with higher returns than putting money in banks or other forms of investment (Madanipour 1998, p. 173). Between the end of the Second World War and 1960, 25,000 hectares of land has been exchanged in Tehran. This is twice the actual amount of urban land of 13,300 hectares and shows the speculative activities on land. The price of land rose 23% annually between 1940 and 1960, while at the same time the price of goods and services rose only 12% annually. Between 1974 and 1977, the land price index increased from 100 to 338.6, while the food and services price index rose from 100 to 160.2. At the peak of the market in 1976, land prices in Tehran reached IRR 250,000 ($3,570) per square metre; this is 55.4% of total development cost. In 1995, the highest land price in Tehran was IRR 3,205,000 ($1,068), although in Iranian Rials, the value is twelve times more expensive than twenty years earlier, but in US dollars it is only 30% of its 1976 value (Madanipour 1998, pp. 181–183). However, in the next twenty years, the land prices in Tehran increased exponentially, and in 2014 the highest land price in Tehran was IRR 400,000,000 ($12,3844 ) per square metre. This demonstrates a 124 times increase in Iranian Rials and 11.6 times increase in US dollars value compared to 1995. Azizi studied the housing indicators between 1991 and 2001 (1371–1379) and highlighted that in this period land prices in urban areas had increased constantly. This, apart from having a direct relation to inflation, can be also attributed to the termination of public provision of urban land policies and selling density5 in major cities. Other major indicators of housing prices also rose sharply during that tenyear period. Construction services increased by 558%, while the wholesale price of construction material increased by 750% (Azizi 2005). This demonstrates the trend in which property prices rise in Iran, where many individuals gain major profits, while at the same time others will not be able to afford buying appropriate housing. High land prices in comparison to other sectors of the economy have had a number of negative impacts on Tehran. They have reduced the amount of green space in the city, have negative effects in the development of public facilities, and have excluded a large part of the population from access to housing and have increased social 4 5

1 USD = 32,300 IRR on September 27, 2014 (Source: fibazar.ir. Accessed 27 Sept 2014). See the Urban Management in Tehran section of this chapter for more detail.

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segregation. Land is developed in shorter cycles and at higher density. Also, they have prevented the capital from being spent in other parts of the economy and increased rents, and all of these factors have resulted in a major increase of inflation. It is also worth noting that the provision of infrastructure has always been behind housing development (Madanipour 1998). Madanipour (1998) quotes Hoyt as saying that “if one sector of the city first develops as a high, medium, or low rental residential area, it will tend to retain that character for long distances.” This is the case of Tehran, which started in the nineteenth century and continues till today. The north–south divide in Tehran is in accordance to this principle, and the land price mechanism has sustained this polarisation. The land price mechanism based on the physical and social qualities of the north has institutionalised this supremacy. This north–south divide overrules core– periphery relationships, and north and south of CBD have different patterns of land prices. In the north, prices increase as you move away from the CBD, and in the south prices decrease as you move away from the centre. In 1995 the cheapest residential land in Tehran in the southernmost district was IRR 185,000 per square metre, while the most expensive in the north was seventeen times more expensive at IRR 3.205 million. This highlights the social polarisation that exists in Tehran (Madanipour 1998, pp. 185–187) (see the earlier discussions by Bertaud 2003 and Fig. 3.4 for spatial distribution of land prices in Tehran). This divide has more than doubled in twenty years; the lowest price of residential land in 2014 in the southernmost district of Tehran was IRR 11,000,000 per square metre, and the highest price of residential land was thirty-six times more expensive at IRR 400 million in northern Tehran.6

3.3.2 Small-Scale Versus Large-Scale Developers in Tehran The private-sector developers operating in the Iranian development industry vary from small- to large-scale developers. In Iran as in other developing countries majority of housing is constructed by households through self-construction or smallscale builders (Sarvari et al. 2021). In 1992, the private sector built around 90% of new homes, and government housing accounted for only around 10% of new homes, which was mainly housing for government employees (this was around 14% of total government spending). Between 1991 and 2001 (1371–1379), private-sector housing provision rose from 193,000 units in 1993 to 291,000 units in 1999 (Azizi 2005). However, during that ten-year period, the majority of housing that was built was in one to two storeys, with 75.7% of new housing with only one unit, 18.6% with two units, 5.8% with three units and more, and the average unit size was hovering around 150 square metres (Azizi 2005). The private-sector developers vary in size. There are small-scale developers who acquire a small plot of land, develop it, and then sell it. This is usually an individual master builder (Mimar), although at the height of the development cycle, because 6

Source: http://fararu.com/fa/news/189318/. Accessed 27 Sept 2014.

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of the profitability of this sector, other professionals, e.g., doctors, engineers, and architects, were attracted to this and acted as developers. These individuals do not set up registered companies, since their only contact with official procedures is when they want to buy or sell the property and pay tax. Tax is charged at the time of transactions, and to avoid this, they usually ask the landowner near the end of the project to transfer the units directly to the buyer as if it was developed by the landowner. There is also a formal version of small-scale developers, who have an office and registered legal status. This secures them a certain place in the development industry, and they operate in the higher end of the market. Depending on their size, they usually manage a team of skilled and unskilled workers and a few contractors (Madanipour 1998). Large-scale development reached its peak in the 1970s in Tehran due to the increase in Tehran’s population and high demand for dwellings. These large-scale developers could develop a row of identical houses, medium- to high-rise buildings, and even neighbourhoods. At the peak of the development cycle in the 1970s and its increasing profitability, a group of developers, with the help of banks and the royal family, developed new towns in and around Tehran, e.g., Sharak-e Qods and Shahrara, which gave them significant profits. These developments took place in two forms: in the first one, they subdivided the land, provided some infrastructure, and then handed it to individual developers; in the second form, they built the buildings as well. In both cases the majority of investment capital came from deposits from potential buyers. Large-scale development once again peaked in the 1990s due to sound economic conditions. Authorities’ emphasis on vertical development and high demand for residential and commercial space all led to major investments in high-rise buildings and large-scale developments (Madanipour 1998). In terms of the type of developments that these different types of developers build, generally large-scale developers use new technologies and standardised design in their projects, while small-scale developers usually develop lower qualities and a variety of forms. Households also develop projects for their own use, which is a high portion of housing production. In rural areas and poor neighbourhoods, the self-help process of construction is dominant, and also, in these cases, a few skilled construction workers often supervise the process. Households building for their own use has led to the majority of buildings being in one to three storeys. This trend changes in different parts of town and in relation to the price of land and density, which is growing in Tehran (Madanipour 1998).

3.3.3 Housing Indicators Housing is an important indicator for the quality of life. Zebardast, in his research in 2009, mentions that satisfaction with housing is a key component of quality of life and one of the most important predictors of life satisfaction. More than just a place for living, it has to do with family well-being (Zebardast 2009). Table 3.3 shows the basic housing indicators for national urban areas of Iran and gives an understanding

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Table 3.3 Housing domain quality of life indicators for national urban areas in 2006 and 2016 Housing domain quality of life indicator

Urban areas (2006)

Urban areas (2016)

Household size

4.63

3.26

Number of people per housing unit

5.32

3.39

Household per housing unit

1.15

1.04

Percentage of units one story

75.8

NA

Percentage of units with durable materials

78.4

NA

Mean plot size (m2 )

148

NA

Housing tenure: owner occupied (%)

66.73

54.5

Housing tenure: rented (%)

23.97

36.7

Access to water (%)

96.38

99.56

Access to electricity (%)

99.09

99.99

Housing units with adequate cooling (%)

49.38

90.36

Housing units with kitchen (%)

89.27

99.08

Housing units with bath (%)

84.5

99.33

Housing units with toilet (%)

99.6

99.72

Source Table adapted from Zebardast (2009) and updated based on Statistical Centre of Iran (2016)

of the general housing situation in Iranian cities, which are the subject of study in this research. The 2016 update shows that these indicators have improved in almost all categories in a 10-year period. In his study of these housing indicators in the spontaneous settlement of Tehran (many of which have worse conditions than the run-down areas in the city), Zebardast found out that although these areas were lower than the national average, they were not in a much worse situation, with housing durability being the worst factor. He concludes: This indicates that the housing domain of quality of life in these spontaneous settlements could easily be improved to reach to the acceptable levels of the planned settlements. Therefore, they should not be viewed as part of the country’s housing crisis but rather as the urban poor’s contribution to its solution. Steps should be taken towards improving their living standards and their gradual regularization and incorporation into the legal city. (Zebardast 2009, p. 323)

One of the interesting elements in the housing indicators of Iran is the high rate of homeownership. This number has risen steadily in urban areas from 1966 to 2006, however it experienced a decline from 2006 to 2016. The overall increase can be attributed to the fact that providing housing was one of the major objectives of the government after the revolution. Policies such as land provision in the early years of the revolution (see Keivani et al. 2008 for more detail), where cheap land was provided to households to build their own homes, were responsible for some of these effects (Azizi 2005).

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On the other hand, this could be attributed to the social and family support system that exists in Iranian society. When Allen et al. (2004) analysed the homeownership patterns in the southern European countries, they found a similar pattern. While Spain and Italy homeownership rates were 82 and 69%, respectively, Germany’s homeownership rate was only 43%. Allen et al. (2004) believe that the paradox between high rates of home ownership in southern European countries, where there are poorly developed mortgage systems, can be explained by what he calls “wider social institution, the way extended southern family strategies respond to markets in providing housing for their members” (Allen et al. 2004, p. 26). In the Iranian case, apart from government policies, the social and family aspects also play a leading role in providing housing, as will be demonstrated in the case studies of this research.

3.4 Urban Management Policies in Tehran This section looks at the main urban management policies in Tehran. First, selling density as one of the main means of income for Tehran Municipality and a driver of development in Tehran is discussed. The following section looks at Tehran Municipality’s urban regeneration policies and the current condition of the run-down areas of Tehran before moving to the case study analysis.

3.4.1 Selling Density as Tehran Municipality’s Major Urban Policy In order to better understand the urban management policies in Tehran and the attitude towards development, it is important to note that in the wider context of Iran, throughout its recent history, there has been a desire for development and achieving modernity without a significant will for preservation. This perspective has been especially apparent in the urban intervention policies. Diba et al. (2007), in their article titled “Preservation and Development in Iran,” confirm this issue and discuss it at length (see Diba et al. 2007 for more detail). Tehran is no exception to this rule, and, wherever possible, it has demolished its past in order to rush to the future. An example of this is the way in which urban management policies in Tehran operate. As mentioned earlier, Tehran is a city with a strong north–south divide, and solving this strong divide was one of the major demands for people who took part in the Iranian Revolution of 1979, which was centred in Tehran. After the success of the revolution, addressing this issue was postponed by the start of the Iran–Iraq War in 1980, which took almost eight years. After the war, the first Tehran master plan after the revolution was approved in 1991, with solving the inequality of Tehran as one of its main objectives. However, this master plan was dismissed by the municipality since

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there were no financial resources for implementing its propositions (Kheyroddin 2010). Following the revolution of 1979 and the eight-year war with Iraq, the Iranian government faced lack of resources to fund municipalities across the country. As a result, the government obliged municipalities to reach financial independence, allowing them to sell density as a major source of revenue. In Tehran, this move coincided with the mayoral term of Karbaschi from 1989 to 1998, which is also labelled as the reconstruction period in the whole country following the eight-year war. Karbaschi devised an extensive redevelopment strategy funded through density sale. Approval of Tehran Master Plan in 2007, which was supposed to control density sale did not succeed in doing so, reaching up to 70% of municipality revenue during some years of Qalibaf’s mayoral term (Ghadami and Newman 2019). The municipality’s reasoning for this policy was to “get money from the rich in order to spend it for the poor” (Kheyroddin 2010). Although this policy resulted in a major income source for the municipality, and they managed to build many projects, including parks, highways, cultural centres, and so on, Kheyroddin (2010) in his research points out that these policies resulted in a major surge in the property prices in the already rich northern areas. The urban management body of Tehran not only failed to solve this problem but also many of its policies unintentionally resulted in increasing the gap between the rich and poor parts of Tehran. Selling density changed the skyline of Tehran dramatically. The densification strategy did not consider urban design principles of high-rise construction including lot size, accessibility, and infrastructure. Criticisms towards density sales and a lack of integrated approach for its consequences, resulted in a new law that only allowed lots greater than 300 square metres with access roads greater than 12-m width to build additional density. The consequence of this policy was development and population growth in newer parts of Tehran in the northern and western districts, while stagnating the older inner and southern districts causing further deterioration and population decrease (Ghadami and Newman 2019). Between 1993 and 2007, more than 50% of the new developments happened in the five northern districts, and less than 50% in the other sixteen districts. Therefore, the urban management policies of Tehran Municipality unintentionally resulted in increasing this gap between the rich and poor parts of Tehran (Kheyroddin 2010). Nevertheless, there has been some redevelopment activity in the run-down areas, especially following the facilitative policies after 2009, but it has been minimal compared to the northern districts. Figures 3.7 and 3.8 illustrate the trend of the number of issued planning permits over almost two decades between 2001 and 2019 in Tehran and deteriorated areas over this period. Figure 3.8 illustrates the same data for the deteriorated areas of Tehran. As can be seen in both charts, developments in Tehran in the past two decades had some fluctuations, with a few high and low points. Some of this can be attributed to the urban management policies of Tehran and the trend in which the municipality was issuing planning permits, and some of it to the wider economic conditions. However, what is interesting here is that the developments in deteriorated areas

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63

Tehran 37500 30000 22500 15000 7500 0 01

02

03

04

05

06

07

08

09

10

11

12

13

14

15

16

17

18

19

planning permits

Fig. 3.7 Number of issued planning permits in Tehran from 2001 (1380) to 2019 (1398) (Source Chart created by author based on data from the Municipality of Tehran database, 2020)

Deteriorated areas 8000 6400 4800 3200 1600 0 01

02

03

04

05

06

07

08

09

10

11

12

13

14

15

16

17

18

19

planning permits

Fig. 3.8 Number of issued planning permits in the deteriorated areas of Tehran from 2001 (1380) to 2019 (1398) (Source Chart created by author based on data from the Municipality of Tehran database, 2020)

had approximately followed the general trend of Tehran. There are some minor differences in the trend for deteriorated areas, and it had not been a direct relationship. For example, with the introduction of new facilitative policies by the municipality from 2009, a major increase in development activities in deteriorated areas can be seen. Nonetheless, the similarity between the two trends is paramount.

3.4.2 Urban Regeneration in Tehran Urban regeneration is currently one of the urban management priorities of Tehran Municipality. Danger of possible earthquakes is one of the major drivers for urban regeneration in the deteriorated areas of Tehran. Based on the UN’s report in 2003, Iran has one of the highest rates of earthquake vulnerability in the world. The experience of the Bam earthquake in 2003, where more than thirty thousand people

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died, showed that human casualties and physical damages are at their maximum in run-down urban areas (Asgari et al. 2008). Asgari et al. (2008) believed that reinforcing the buildings could be the major action to increase earthquake resilience in Iran. However, when looking at run-down areas, they mentioned that apart from building structures, there are other problems that need to be addressed. First, narrow road structures, which in the case of an earthquake can be easily obstructed and block the access of emergency vehicles. Second, high density and lack of open spaces; these areas can act as an open and safe shelter after an earthquake. Third, reinforcement of major public buildings like hospitals, schools, and infrastructure roots, including gas, electricity, and water. These are all issues that are apparent in run-down neighbourhoods of Tehran and need to be dealt with (Asgari et al. 2008). Therefore, urban regeneration has received unique attention in recent years. Nevertheless, the practice of regeneration is still in its infancy in Iran, especially if one looks at the community aspects and participatory nature of urban regeneration projects. Habibi and Saiidi (2005) believe that participatory planning in Iran is just used as a slogan and that none of the attributes of genuine participatory practices are respected. The few examples that are called participatory planning mainly ignore residents’ opinions and are there to serve the planners’ and state’s will. Moreover, when participation happens, it is only financial participation, in order to compensate for the lack of required investment. However, they believe that talking about participation is better than not mentioning it at all, and they see this as a first step to move towards genuine participatory planning practices (Habibi and Saiidi 2005). In terms of the implemented regeneration projects in Tehran, one of the only examples of a completed redevelopment project is the Navab project. The implementation phase of Navab started in 1994, and some parts are still under construction. This was an extensive project, built in central Tehran, in what used to be a run-down neighbourhood. As a result, 479,600 square metres of residential units were demolished. The project was built as a building corridor around a highway in four phases (414). The length of the highway is 5.5 kms with the width of 50–60 m and also 10–30 m for buildings on each side of the highway. The project introduced more than 8,500 new residential units and also up to 160,000 square metres of office and commercial space. The investment in Navab required substantial financial resources, which is one of the reasons that the redevelopment process has taken so long. Apart from the government investment, public bonds were issued with relatively high rates of return. Another means for securing financial resources was pre-letting many units at lowerthan-market rates. Over-optimism about the project financial projections resulted in the project being abandoned for two years. Also, financial pressures led to elimination of nonprofitable land uses such as schools, cultural spaces, and green spaces that were initially part of the scheme (Bahraini and Aminzadeh 2007) (Fig. 3.9). Bahraini and Aminzadeh (2007) describe the Navab project as a major technocratic, top-down, and modernistic type of urban intervention. They attribute the failure of the project to many items. The long list covers items ranging from urban design failure and total disregard for the previous fabric to failure in social issues, including an open decision-making process, residents’ participation, and compulsory

3.4 Urban Management Policies in Tehran

Fig. 3.9 Navab project (Source www.mashreghnews.ir. Accessed 4 May 2012)

65

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evacuation of residents. Also, in the economic sense, failures in feasibility studies and cost–benefit analysis of the project are mentioned as the major reasons that Navab proved to be an unsuccessful example (Bahraini and Aminzadeh 2007). There have also been some less aggressive renovation efforts that have happened in Tehran. However, these renovation efforts in historical districts have not been extensive, and they were usually limited to either a few buildings or a road. Marvi Road’s renovation is a recent example (see Fadaiinejad 2007 for more detail). From around 2009, and following the experience of Khoob-Bakht regeneration project, the Municipality of Tehran adapted a more participatory approach towards redevelopment of run-down areas. The Municipality established local offices in rundown neighbourhoods to engage with residents and encourage redevelopment. These offices advocated land assembly of small lots into developable lots and joint ventures with developers who would fund construction costs. As most lots in run-down areas are below 100 square metres, they do not qualify for building code regulations regarding fire escape and parking provision. They also provided administrative support, and developers rented interim housing for residents during construction. The joint venture was typically 60–40 in favour of developers, with the newly built units allocated on this basis (Erfani 2020). In other similar contexts in Turkish cities, lot size is also one of the most important economic factors in urban regeneration. The owners with very small lot sizes were often unable to obtain new housing in the same area without getting into debt. As such, the state should interfere to ensure residents regardless of their property size are secured new housing in the same area (Ince and Aslan 2019). Since 2009 the UROT established more than 50 neighbourhood offices in rundown areas with this purpose. Hajialiakabri (2020) outlines the major shortcoming of the “facilitation” process as follows: absence of a legal mandate for regeneration plans without any obligation for responsible agencies, lack of coordination amongst various stakeholders, inability in provision of public services, and lack of financial resources for implementation projects. Further, he outlines that the identical approach towards all neighbourhoods dismissed the unique characteristic of each context. Lowinterest loans for construction, planning permit discounts and surplus density were the most important incentives offered in run-down areas and for land assembly projects (Hajialiakbari 2020). Urban Regeneration projects in Iran have mainly focused on physical solutions to revitalise the urban fabric (Yazdan Panah Shahabadi et al. 2020). However, a suitable model for urban regeneration of run-down areas has not yet been identified (Sarvari et al. 2021).

3.4.2.1

Situation in Deteriorated Areas and Urban Regeneration Policies

The Japanese International Cooperation Agency (JICA)’s report in 2002 on the vulnerability of Tehran against earthquakes shed light on the extent of vulnerability in run-down neighbourhoods of Tehran. A few years later in 2006 the Supreme

3.4 Urban Management Policies in Tehran

67

Council of Architecture and Urban Planning of Iran defined run-down neighbourhoods as neighbourhoods with majority of buildings vulnerable against earthquake, street networks below 6-m width and lots smaller than 200 m (Hajialiakbari 2020). In 2009, 3268 hectares of run-down fabric in Tehran was identified. Overlap of the above criteria, with each criterion consisting of more than 50% of an area, results in an area being identified as deteriorated. If only one criterion is considered, then the deteriorated areas of Tehran extend to 14,000 hectares. This shows the extent of the problem that Tehran and other major cities in Iran are facing. Deteriorated areas make up 5% of Tehran’s total area, within which 11% of the city’s housing is located and 15% of the total population lives. This underscores the high density of these areas in comparison to other parts of the city (Urban Regeneration Managers of Iran Conference 2009). These areas do not necessarily have old building stock, and they are mainly built within the past fifty years. However, the main problem is that they were built with very low quality in the first place, and as a result they depreciated very quickly. These areas are mainly low-rise neighbourhoods, where the average number of storeys in each lot is 1.7, and 1.4 housing units are located in each lot (Urban Regeneration Managers of Iran Conference 2009). Between 2009 and 2017 with the introduction of facilitative policies in run-down areas, municipality of Tehran stated that around 20–30% of areas categorised as run-down were redeveloped (Information and Communication Technology Organization of Tehran Municipality 2020). The cause of deterioration can be categorised into two types. The first type is caused by inner-city migration from central neighbourhoods to outer neighbourhood resulting in the decline of central neighbourhoods. The second type is caused by migration of low-income households from other cities and villages to vacant lands in the outskirts of Tehran. Construction of substandard housing without adequate infrastructure transforms these vacant areas very quickly into run-down neighbourhoods (Hajialiakbari 2020). As mentioned earlier, since 2008, redevelopment of run-down areas received a great deal of attention from municipalities. In this effort they have tried to highlight the role of residents in regeneration. The head of the Urban Regeneration Company of Tehran, mentions that although people should play a major role, they need to be supported in order to be able to play a leading role in regeneration. He states: This support should be in different aspects; in an economic sense, they need to receive loans in order to be able to participate in such projects. In a social sense, by providing training, education and employment opportunities for them they need to be supported. And the culture of regeneration needs to be established in the city, whereby people know about participation in regeneration, and communal living issues, they need to be educated about benefits of proposed projects. (Interview 2010)

In terms of implementing redevelopment projects, head of the Urban Regeneration Company of Tehran believes that the current policies that are in place truly support the involvement of the private sector in regeneration projects. This includes a free planning permit, faster processing times for administrative procedures, and loans for

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developers and for temporary housing of residents. For mass housing developers, the municipality gives a purchase guarantee in case they fail to sell their finished units. These policies, none of which were in place a few years ago, have resulted in a major surge in new planning permits. They believe investment in these areas needs to become more attractive than other parts of town in order to attract investors to these neighbourhoods (Interview 2010). Iranian major developers (mass housing developers) contribute to 45% of housing construction, but in the run-down areas of Tehran this figure drops to 10%. There are six thousand registered mass housing developers in Iran (Urban Regeneration Managers of Iran Conference 2009). Head of the Mass Housing Developers Association of Iran, the main organisation representing the developers, believes that investors are ready to invest in run-down areas. He mentions that although run-down areas have negative perceptions accompanying them, the key in attracting investment is the financial issues. He states: It does not really matter whether the project is located in a run-down area, or in a new development, as long as developers’ financial expectations are met. The only issue that is holding them back is the issue of trust. They need to trust the municipality in order to enter into partnerships with them, and currently this trust does not exist. Nevertheless, it can be achieved by different means, for example through transparent contracts. (Interview 2010)

Head of Mass Housing Developers Association mentioned that one of the major predicaments for developers in being involved in regeneration projects is the land assembly issues. This has to do with the legal matters as well as the social issues, for having everyone on board for a meaningful project to take place. Temporary housing is another major issue in redevelopment projects, but he thinks a solution to this can be building reserve housing in the vicinity of the neighbourhood at the start of the projects. This, he believes, can increase residents’ participation in regeneration, when they see apartments that are ready for them to move in (Interview 2010). However, at the end he points out that because of the general lack of housing in Iran, developers will not face difficulties in selling their units, even during times of recession. He highlights that, especially in the run-down areas, since the prices are lower than average, there would be demand from larger sections of the population for these types of products (Interview 2010).

3.4.3 Choosing the Case Studies This section explains the reasons behind selecting the two case studies as appropriate examples for this research. The map in Fig. 3.10 illustrates the location of the two case studies within the 3,200 hectares of approved run-down areas of Tehran.

3.4 Urban Management Policies in Tehran

69

Fig. 3.10 Location of case studies in Tehran (Source of the base map: Tehran Master Plan 2006 with permission)

3.4.3.1

Khoob-Bakht: Comprehensive Redevelopment Case Study

Khoob-Bakht can be considered one of the first urban regeneration schemes in Tehran that was aimed at regenerating a neighbourhood for its residents. Its main predecessor, the Navab7 Project, was mainly a highway construction project with building blocks on both sides. There were a few reasons that made Khoob-Bakht the first implemented regeneration project in Tehran. First, following the Bam earthquake in 2003 that resulted in more than thirty thousand deaths, the political establishment was concerned about the consequences of other earthquakes. Many parts of Tehran are located on earthquake fault zones, and run-down areas are the most vulnerable due to their poor construction and urban fabric characteristics. As such, when the new mayor of Tehran was selected in 2005,8 regeneration was on the top of his agenda (Interview 2010). Second, Khoob-Bakht was located next to the proposed Imam Ali highway (see Fig. 3.11). As part of the highway construction project, many lots had been already bought and demolished in that area. Therefore, the Urban Regeneration Organisation of Tehran (UROT), the body responsible for the Khoob-Bakht project, saw this as an opportunity to implement a few initial projects in order to both trigger developments and also use these developments as transitional housing for residents. Third, a 200 million USD loan was secured from the ABC Bank of 7 8

The Navab project was discussed earlier in this chapter in detail. Ghalibaf had recently replaced Ahmadinejad as the new mayor of Tehran.

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3 Urban Development in Iran and Tehran

Fig. 3.11 Imam Ali highway proposal and Khoob-Bakht (Source Imam Ali regeneration plan 2008 with permission)

3.4 Urban Management Policies in Tehran

71

Bahrain for regeneration of earthquake-vulnerable areas in Tehran, which again was an opportunity to be used for this regeneration scheme (Interview 2010). All these helped in triggering the regeneration project in Khoob-Bakht and made it one of the first urban regeneration experiences in Tehran.

3.4.3.2

Malek-Ashtar: Piecemeal Redevelopment Case Study

In order to choose a piecemeal redevelopment example in Tehran, a few criteria had to be met. First, the site had to be a deteriorated neighbourhood, which was identified from the approved deteriorated areas in the Tehran master plan (Fig. 3.11). Second, the deteriorated neighbourhood should have gone through piecemeal redevelopment over the past few years. Amongst the deteriorated areas of Tehran, District 10 (where Malek-Ashtar is located) had the most redevelopments within its deteriorated areas in the past ten years (see Table 3.4 with district 10 highlighted in bold). The above data meant that many neighbourhoods in District 10 should have redeveloped organically during the past ten years. After site visits, it became clear that in some areas the extent of redevelopments was to a degree of complete renewal and the neighbourhoods could no longer be considered as deteriorated. In the absence of historical data, analysing these areas as deteriorated neighbourhoods was not possible. However, as illustrated in Fig. 3.12, Malek-Ashtar was a neighbourhood that was still in a deteriorated condition with spontaneous redevelopments. Further, in order to compare Malek-Ashtar alongside the comprehensive redevelopment case, some common grounds were required. In addition to their similarities in terms of deterioration and redevelopment, both neighbourhoods had a dominant residential character with a similar population size of around twelve thousand inhabitants. Both neighbourhoods were also formed around the same time, facing a similar level of deterioration. Despite these similarities, it is impossible to find two areas that are exactly the same, even in the same city. In this study, the major difference was the relative centrality of Malek-Ashtar compared to Khoob-Bakht, which resulted in higher Table 3.4 Number of planning permits issued between 2001 and 2010 (1380 and mid-1389) in deteriorated areas by district District

7

8

9

10

11

Planning permits

1 202

2 58

3 108

4 26

5 11

6 26

2104

1591

1151

6668

3811

District

12

13

14

15

16

17

18

19

20

21

22

Planning permits

3483

803

3743

994

1139

2254

1421

134

1234

34

26

Tehran Total

31,021

Source Table created by author based on the planning permit database of Tehran Municipality

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Fig. 3.12 Newly built buildings, showing piecemeal redevelopment in Malek-Ashtar (Source Sharmand 2009 with permission)

property values that were instrumental in creating the platform for piecemeal redevelopments. As both projects were in the implementation stage, it provided valuable information on how they were being implemented on the ground, which would have not been possible if the projects were already completed. Other researchers, like Kuyucu and Unsal (2010), have also benefited from such an approach in analysing urban transformation projects in Istanbul during implementation.

3.5 Conclusions Based on the reports by the World Bank, it was demonstrated that the housing sector is a significant component of the Iranian economy, and housing market behaviour, as well as the rest of the Iranian economy, is highly impacted by oil revenues and high inflation. While the development sector in Iran is supported by a construction industry that is reasonably developed, its growth is hampered by an underdeveloped housing finance system, which alongside the high house-price-to-income ratio has created significant affordability issues. The urban land policies in Iran, as one of the major urban development policies of the Iranian governments to tackle housing affordability, demonstrated the context of government intervention in urban development and policy processes and the implementation issues that arise from such policies. With regard to the development of Tehran, it was demonstrated that with the rapid urban expansion that Tehran has experienced, accompanied by the lack of supervision and lax regulations, many low-quality urban areas have been shaped.

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Many of these areas, in just a few decades, have turned into the current run-down areas that are the subject of this research. The current urban structure of Tehran comprises a unique spatial distribution of population and land prices, with the rundown areas experiencing population decrease and the lowest land prices within the city. The current development industry in Tehran was also outlined in detail, highlighting the constant rising land prices that have turned real estate into an “asset of refuge” and a hyperactive real estate market that is constantly changing the landscape of Tehran. The characteristics of the small- and large-scale developers who constitute the development industry were outlined, with small-scale developers playing a more significant role. Further, the type of housing that is produced and housing indicators were discussed. Finally, urban management policies in Tehran were discussed, including urban regeneration policies and previous regeneration experiences. As outlined, Tehran not only faces extensive deteriorated areas intertwined with various problems but also urban regeneration experience in Tehran is limited to a few cases, and a successful example has hardly been experienced. This highlights the importance of analysing the two redevelopment examples that are selected for this research and that will be examined in detail in the following chapters.

References Allen J et al (2004) Housing and welfare in Southern Europe. Blackwell, Oxford Asgari A et al (2008) Determining the structural/building factors in vulnerability of old urban fabric of Zanjan using GIS and Fuzzy Logic. Fine Arts Academic Journal 33:27–36 in Persian Azizi M (1998) Evaluation of urban land supply policy in Iran. Int J Urban Reg Res 22(1):94–105 Azizi M (2000) Development of urban intervention policies in historical fabrics in Iran. Fine Arts Academic Journal 7: 37–46 in Persian Azizi M (2005) Analysis of the development of housing indicators in Iranian cities. Fine Arts Academic Journal 23:25–34 in Persian Bahraini H, Aminzadeh B (2007) Evaluation of Navab Regeneration Project, Central Tehran, Iran. Int J Environ Res 1(2):114–127 Bertaud A (2003) Tehran spatial structure: constraints and opportunities for future development. Ministry of Housing and Urban Development of Islamic Republic of Iran. Central Bank of Iran (2021) Economic development indicators of Iran in 1399. Office of Economic Accounts Curtis G, Hooglund E (ed) (2008) Iran: a country study, 5th edn. Federal Research Division, Library of Congress, US. Diba D et al (2007) Preservation and development in Iran. Fine Arts Academic Journal 32:51–60 in Persian Erfani G (2020) Sense of place as an investigative method for the evaluation of participatory urban redevelopment. Cities 99:102648 Fadaiinejad S (2007) Renovation, rehabilitation and reconstruction of Marvi way. Fine Arts Academic Journal 32:61–71 in Persian Fanni Z (2006) Cities and urbanization in Iran after the Islamic revolution. Cities 23(6):407–411 Farahzadi M (2019) Evaluation of housing and building indices in censuses from 1365 to 1395. Iranian Journal of Official Statistics Studies, Statistical Centre of Iran 29(2):151–163 in Persian

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Ghadami M, Newman P (2019) Spatial consequences of urban densification policy: floor-to-area ratio policy in Tehran, Iran. Urban Analytics and City Science 46(4):626–647 Habibi M, Saiidi S (2005) Participatory planning, a theoretical search in the situation of Iran. Fine Arts Academic Journal 24:15–24 in Persian Hajialiakbari K (2020) The rise of the facilitation approach in tackling neighbourhood decline in Tehran. In: Arefian F, Iradj Moeini S (eds) Urban heritage along the silk roads: a contemporary reading of urban transformation of historic cities in the Middle East and beyond. Springer Nature Switzerland, pp 55–75 Healey P, Barret S (1990) Structure and agency in land and property development process: some ideas for research. Urban Studies 27:89–104 http://fararu.com/fa/news/189318/ http://fibazar.ir http://www.mashreghnews.ir http://www.pcfors.com http://www.worldbank.org/ IMF (2021) Country Data of Iran. Available at https://www.imf.org/en/Countries/IRN#countrydata. Accessed 30 Dec 2021 Ince CD, Aslan B (2019) Monitoring the effects of land sizes on private property transformation in an urban regeneration project by regression analysis: Erenler Cedit case study, Kocaeli. Sustainable Cities Soc 50:101632 Information and Communication Technology Organization of Tehran Municipality (2020) Tehran statistical yearbook: 2019–2020. Tehran, Iran Interview with Head of Mass Housing Developers Association of Iran (2010) Interviewed by author, Tehran, Iran Interview with Head of Urban Regeneration Company of Tehran (2010) Interviewed by the author, Tehran, Iran. Interview with Planning Director of KBRP (2010) Interviewed by author, Tehran, Iran Iran Census Organisation, National Census (2016) Keivani R et al (2008) Public management of urban land, enabling markets and low-income housing provision: the overlooked experience of Iran. Urban Studies 45(9):1825–1853 Kheyroddin R (2010) Geo-referential analysis of Tehran’s urban management policies, between 1372–1386 (1993–2007). Fine Arts Academic Journal 42:71–82 in Persian Kuyucu T, Unsal O (2010) “Urban transformation” as state-led property transfer: an analysis of two cases of urban renewal in Istanbul. Urban Studies 47(7):1479–1499 Lowder S (1993) The limitations of planned land development for low-income housing in Third World cities. Urban Studies 30(7):1241–1255 Madanipour A (1998) Tehran: the making of a metropolis. Wiley, West Sussex, England. Modarres A (2006) Urbanization and the revolution: an introduction. Cities 23(6):405–406 Planning permit database of Tehran municipality (2020) Sarvari H, et al (2021) Evaluating urban housing development patterns in developing countries: case study of Worn-out Urban Fabrics in Iran. Sustainable Cities and Society 70:102941 Sharmand Consultants (2009) tarh e manzare shahri malek-ashtar (Malek-Ashtar project) Urban Regeneration Organisation of Tehran. Municipality of Tehran Statistical Centre of Iran (2016) Findings of the National Population and Housing Census—concatenated 2006 to 2016. https://www.amar.org.ir/. Accessed 22 Dec 2021 Tavasoli M (2002) Urban structure and architecture in the hot arid zone of Iran. Payam Publication, Tehran in Persian Tehran Master Plan (2006) Municipality of Tehran. Boom Sazegan Consulting Engineers, Tehran The World Bank (2010) Implementation completion and results report: in support of the first phase of the Iran urban upgrading and housing reform program. http://www-wds.worldbank.org. Accessed Jan 2014 The World Bank (2021) Iran Economic Monitor, The Economy at Crossroads, World Bank Group, Middles East and North Africa Region

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Urban Regeneration Managers of Iran (2009) Conference proceedings, conference November 2009 Tehran, Iran Urban Regeneration Organisation of Tehran (2009) Imam Ali Regeneration report, Tehran World Bank (2004) Islamic Republic of Iran, Ministry of Housing and Urban Development, Strategies for the housing sector. Washington DC, World Bank World Bank (2005) MENA region; The macroeconomic and sectoral performance of the housing supply policies in selected MENA countries: A comparative analysis. Washington DC, World Bank Yazdan Panah Shahabadi, M. R., et al (2020) Explaining the theoretical model of place branding: an asset-based approach to regeneration of the historic district of Tehran. Journal of Brand Management 27: 377–392 Zebardast E (2006) Marginalization of the urban poor and the expansion of the spontaneous settlements on the Tehran metropolitan fringe. Cities 23(6):439–454 Zebardast E (2009) The housing domain of quality of life and life satisfaction in the spontaneous settlements on the Tehran metropolitan fringe. Soc Indic Res 90(2):307–324

Chapter 4

Khoob-Bakht Comprehensive Redevelopment: Description and Analysis

Abstract This chapter describes and analyses the case of the Khoob-Bakht Regeneration Project as a comprehensive redevelopment model. The chapter structure is based on the analytical framework diagram that was illustrated in the conclusion of chapter one, starting with the urban problems that existed in the neighbourhood in order to assess whether or not the regeneration project responded to these challenges. The main analysis section is structured around themes of property development and implementation as key themes that emerged from the earlier theoretical discussions. Utilising institutional analysis as a methodological approach, the chapter unravels the ways in which property actors see the comprehensive redevelopment process and their subsequent actions. The development decision-making is examined within the institutional contexts structured by dynamic needs and concerns of actors, and the developers’ behaviour is analysed combining both economic motivations and social aspects of their decision-making process. The final section provides post-completion analysis of the case study 11 years later in 2021. Keywords Khoob-Bakht neighbourhood · Comprehensive redevelopment · Large-scale redevelopment · Top-down planning · Implementation of regeneration · Large-scale developer behaviour · Urban regeneration incentives

4.1 Background Khoob-Bakht is located in the southeastern part of Tehran (see). In a city with a strong north–south divide, Khoob-Bakht is located in one of the main deprived areas. The neighbourhood developed steadily between 1955 and 1985 on farmlands, next to the mausoleum of one of the Imam-zadehs.1 Those years were a period of mass migration towards major cities in Iran,2 when migrants dwelled on the outskirts of major cities. 1

Imam-zadeh is a term used for the offsprings of the Twelve Imams of Shia Islam. Their mausoleum is a holy place for Shia Muslims. Many Iranian towns are shaped around these mausoleums, with Khoob-Bakht being an example of this type of settlement. 2 See Chap. 3 for further information.

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2022 K. Soltani, Redeveloping Tehran, The Urban Book Series, https://doi.org/10.1007/978-3-030-97091-8_4

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Fig. 4.1 Location of Khoob-Bakht in Tehran (map of Tehran’s deteriorated areas) (Source Tehran master plan 2006 with permission)

This trend is epitomised in Tehran, with Khoob-Bakht having 42% of its residents born outside Tehran (National Census 2006). Lax housing and plot-division policies at the time resulted in the neighbourhood’s dense urban fabric, comprised of small lots with one- to two-storey buildings connected with a narrow road structure (Tarh o Amayesh Consultants 2003) (Figs. 4.1 and 4.2). Based on the 1996 (1375) national census, prior to any intervention in KhoobBakht, 11,535 people lived in the neighbourhood. In a predominantly residential neighbourhood, residential land use occupied approximately 70% of the total area, with all other services and public activities occupying less than 5% of the total land. However, just before the start of the regeneration process in 2006 (1385), 8,605 people lived in the neighbourhood (National Census 2006). This reduction was mainly due to the expropriation that occurred during the highway construction for the Imam Ali project (Fig. 3.11).

4.2 Urban Problems in Khoob-Bakht

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Fig. 4.2 Khoob-Bakht neighbourhood (Source Author 2010)

4.2 Urban Problems in Khoob-Bakht This section outlines the urban problems that existed in Khoob-Bakht prior to the start of the regeneration project. It is crucial to be aware of these problems in order to understand whether the regeneration project has solved or addressed any of these issues. The urban problems are categorised under physical and social problems, which are interrelated to a great extent. In terms of physical urban problems in Khoob-Bakht, approximately 85% of the lots are smaller than 100 square metres, with 67% under 75 square metres and 30% under 50 square metres (National Census 2006), highlighting the fragmented nature of the urban fabric in this neighbourhood. Run-down neighbourhoods, and Khoob-Bakht specifically, suffer from lack of infrastructure and services. Most of the buildings do not have concrete or steel structures, and as such they are not earthquake resilient, which can be a significant risk in an earthquake-prone city like Tehran. Lots are extremely small, and narrow road structure is another common problem. Deputy director of KBRP points out that these neighbourhoods, with their run-down environment, are a result of the poor economic conditions of their residents, highlighting that the residents cannot afford to improve the physical conditions of their buildings and their neighbourhood as a whole (see Fig. 4.3) (Interview 2010).

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Fig. 4.3 Physical problems in Khoob-Bakht (Source Author 2010)

The director of the KBRP Local Office and head of implementation reiterates that Khoob-Bakht was an area where people came to live due to their poor economic conditions: They bought a small plot of land, and built a few rooms without following the rules and regulations. There was not a proper supervision on construction in this area. This would not happen in other parts of town, but here municipality did not have supervision in the midst of these narrow alleys, and winding roads. By building a few rooms, they solved the housing problem for themselves and their immediate family members. In some cases when their son could not find a job, they built a room in the corner of the courtyard with a door opening to the alley that operated as a shop. In this way, Khoob-Bakht solved the housing and employment problem for some people with minimal expenditure. (Interview 2010)

Throughout the project, the earthquake vulnerability of the neighbourhood was treated as the main driving issue behind regeneration, and to some extent it was done in an emergency manner. In the words of the director of KBRP local office, “Our goal is the safety of residents... we should try to rescue as many people as possible, in the case that an earthquake occurs in a month. Therefore, whoever was ready to participate, we took them out of their houses, and destroyed the vulnerable areas” (Interview 2010). Social problems were a major part of the urban problems that existed in the neighbourhood prior to intervention. However, director of the KBRP social unit indicates that no major social study of the neighbourhood was undertaken prior to

4.2 Urban Problems in Khoob-Bakht

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Fig. 4.4 An example of the drug addiction problem in Khoob-Bakht (Source Author 2010)

the start of the project. With only some demographic studies, there was no proper understanding of the underlying social problems. As such, the UROT was surprised by the extent of social problems that they faced, including poverty, drug-related issues, low level of education, and lack of public services, especially for leisure activities for young people and women (Interview 2010). The social composition of Khoob-Bakht is a complex mix. Within this mix, two groups proved to be the most problematic, namely, the transient population and drug addicts. Throughout the years Khoob-Bakht has served as a transient place, with anyone who could afford to move to a better place leaving the neighbourhood. As such, Khoob-Bakht has seen an accumulation of low-income social classes, with a relatively low sense of belonging. With regard to the drug addiction problem, the deputy director of KBRP sees the root of this issue in the events of Khak-Sefid3 in 2001, when drug-dealing gangs spread across Tehran, with many finding a safe haven in Khoob-Bakht. These people were major consumers and dealers of drugs, creating many problems in the area that are evident to this date (see Fig. 4.4) (Interview 2010). 3

Khak-Sefid was a neighbourhood in southern Tehran, which was a major hub for drug dealers for many years. In 2001 police surrounded the area and demolished all the buildings overnight, clearing the whole neighbourhood.

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Another major issue in Khoob-Bakht was the empty lands and buildings that were mainly vacated for the proposed Imam Ali highway. Starting in 2001, the municipality started to expropriate properties for the proposed highway that was supposed to pass through the neighbourhood; however, in 2003 the route for the proposed highway changed to outside the Khoob-Bakht neighbourhood (the initial purchases were one of the reasons that triggered the Khoob-Bakht regeneration project). These empty properties deteriorated into locations of crime, significantly impacting the security of the area. The director of the regeneration plan, responsible for preparing the regeneration proposal, considered this as one of the major issues that Khoob-Bakht faced prior to the start of the regeneration project. He indicated that the initial purchases for the proposed highway, and then the change in the route of the highway, created complex social consequences with widespread public dissatisfaction (Interview 2010). With regard to employment in Khoob-Bakht from the active population of 7,263 in 2006, around 40% were categorised as employed, 28% as housewives, 17% as students, 5% had income without being employed, and only 3% were categorised as unemployed (National Census 2006). Although there is a reasonable level of employment in the neighbourhood, the majority of residents were involved in lowpaying jobs, resulting in their current economic condition. Some of this employment was created through the nonlicensed activities that were being conducted in the neighbourhood. At the time of intervention there were a few dried fruit and yogurt producers, which were operating in completely unsanitary conditions, without any supervision from the Health Ministry. As the director of the KBRP local office recalls, there were people who were ordering these products from the residents and then selling them on the market with a fake brand name. There were also notebook-publishing workshops in the neighbourhood, creating a lot of noise in residential areas. “Having low value properties, a cheap workforce, and absence of supervision can create these conditions” (Interview 2010). Another issue that was not a problem, per se, but that proved problematic in the regeneration process was that in some cases housing was not only a place of residence but also an income source for residents. In a neighbourhood with a majority of twostorey buildings, in many cases landowners would squeeze in a 40–50 square metre unit, renting out the top floor in order to generate additional income. One of the developers recalls an apartment unit that was separated into two units with a curtain, with the other half rented out (Interview 2010). The 2006 national census stated that 2,312 households lived in the 2,080 residential units in Khoob-Bakht, resulting in 1.11 households per unit (National Census 2006). These setups were all disrupted by the start of the regeneration project. The age diagram in Fig. 4.5 illustrates the population configuration of KhoobBakht. The neighbourhood had 8,605 residents in 2006, 4,503 of which were male and 4,100 female. The 10% extra male population can be mainly attributed to the single male migrant-worker population, mainly employed in low-paying jobs. The diagram also illustrates a higher proportion of residents over the age of sixty-five, which is mainly due to the way the census data is categorised, with the over- sixty-five population being grouped into one category as opposed to the five-year age groups preceding it.

4.3 The Khoob-Bakht Timeline

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Fig. 4.5 Age diagram of Khoob-Bakht (Source Chart created by author based on data from 2006 Census of Iran Census Organisation)

4.3 The Khoob-Bakht Timeline In order to better understand and analyse the Khoob-Bakht regeneration project, it is crucial to look at the journey that the project went through from the initial idea in 2006. Aminzadeh and Rezabeigi (2012) state that neighbourhood plans in Iran have historically lacked any meaningful connection with the citywide urban plans, and they have also lacked the necessary implementation considerations. As such, they argue that urban regeneration projects, and Khoob-Bakht specifically, were an attempt to include implementation considerations in urban plans; however, they still lacked a meaningful connection with the wider city plans. Further, these urban regeneration projects were aimed at encouraging public participation and increasing private investment in urban projects within the municipal management framework. The Khoob-Bakht project started in January 2006 with the initial studies. This process took around one year, resulting in a report on the regeneration project with some guidelines. This report was the first of its kind in Iran’s planning system, attempting to encompass a variety of aspects to make the project feasible. This included talking to developers, investors, and different social groups. As part of this initial process, the UROT started to build reserve housing in the vicinity of the project. From February until October 2007, the aforementioned report was examined by various professionals, resulting in several feasible and phased projects. Then, on October 4, 2007, the mayor of Tehran officially inaugurated the implementation phase

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titled the “A House for a House” project, highlighting the objective of replacing the run-down homes with new homes for residents (Andalib 2010) (Figs. 4.6 and 4.7). One of the major transformations took place in the first twenty-one months since the start of implementation. Over this period (October 2007–June 2009), major stakeholders including developers, investors, public authorities, and residents started to participate in the process. This was the first time that public participation had materialised, with projects starting to develop gradually. Nevertheless, this phase experienced some low points as well, including after the Iranian New Year in March when

Fig. 4.6 The mayor of Tehran (front row, second from right) amongst Khoob-Bakht residents inaugurating the project (Source UROT website. Accessed August 17, 2011)

Fig. 4.7 The Khoob-Bakht proposal (Source UROT website accessed August 17, 2011)

4.3 The Khoob-Bakht Timeline

85

a drop in participation occurred. This could be mainly attributed to the general uncertainty of the year ahead that often overshadows the country’s development projects each year.4 Then, in March 2009, the management of the UROT changed, interrupting the pace of the developments. For the first few months, the new management was familiarising itself with the project and the area, resulting in a slowdown of implementation until September 2009. Then a deadline was set for finishing the project, which increased the pace of participation for some time, but then again since the deadline could not be met, implementation slowed down again. With decreased participation from the residents and the uncertainties within management, the UROT finally decided to halt the project completely on March 3, 2010 (Andalib 2010). This halt increased the scepticism amongst residents and stopped their participation in the regeneration process. As a result, the role of the local office changed from that of a body responsible for advocating participation in the project and connecting resident with developers to that of an office only supervising construction and allocating the completed apartments to residents. On December 2009 the initial contract of the UROT came to an end, and the management was transferred to another semipublic organisation that continues to date. These changes in management, together with the ups and downs in the implementation phase, not only decreased the momentum of the project but also increased the distrust amongst residents towards public authorities (Andalib 2010) (Fig. 4.8).

4.4 The Regeneration Process The Khoob-Bakht regeneration project had the following objectives, as outlined by the deputy director of KBRP: First, providing the land uses that the neighbourhood needed, including open space, health care, cultural, and sport facilities. Second, renewing the housing stock; with most of the lots being under 60 square metres, the plan was to assemble at least four to five lots in order to develop good-quality buildings that are earthquake resilient. Third, exploiting the economic potential of the new Imam Ali highway, a major transport route passing right next to the neighbourhood, in order to create wealth in the area (Interview 2010).

4

Since Iran’s economy is highly dependent on the volatile price of oil and political situation in the region, the country encounters much uncertainty every year. Iranian New Year (Norooz), which is on March 21 each year, marks the start of new beginnings, especially in relation to economic activities for the year ahead. As such, every year a general uncertainty overshadows economic activities at this specific time of the year. See the article by Homa Katouzian (2004) “The short-term society: a study in the problems of long-term political and economic development in Iran,” Middle Eastern Studies, 40 (1), pp. 1–22 for a more detailed discussion on short-term attitudes towards planning in Iran in a historical context.

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Fig. 4.8 Chronology of the Khoob-Bakht implementation process (Source [Google maps]. 2005: Khoob-Bakht before the start of implementation. 2007: Empty lots show the start of land assembly. 2008: More lots were assembled. 2009: Construction of new projects started)

This section outlines the process that was followed in order to achieve these goals. Andalib, the first director of UROT, in his book about the Khoob-Bakht regeneration project, categorises the regeneration process into five stages, illustrated in Fig. 4.9.

Fig. 4.9 Regeneration process in Khoob-Bakht (Source Chart created by author with information from Andalib 2010)

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During the first stage, starting in June 2007, the financial plans for the project were prepared and discussed with a few residents as a sample. Then, in July 2007, a few private meetings and three public meetings were held with residents. At the same time other initiatives were organised in order to increase awareness about the regeneration project, such as introduction to living in apartments and painting competitions at schools as well as other events with the central theme of regeneration. The UROT distributed leaflets about the project as well as posters with warnings against potential earthquake risks. UROT officials participated in local events, using them as opportunities to inform the residents, and held various meetings with those who were against the project. Andalib named the scepticism of residents towards the project as well as social barriers between the UROT officials and residents as the major obstacles in these communications (Andalib 2010). In the second stage, after the general notifications, private meetings were held with the residents of each block. A UROT representative was appointed for each of these blocks who was responsible for communicating with the block residents in order to persuade them to participate in the project. Over this period, from August 2007 to May 2008, from the 929 lots in the neighbourhood, residents of around 110 lots (12% of the total) agreed to participate in the project. Taking into account the 120 lots that were previously purchased for the highway construction, approximately 25% of the total lots were freed. However, as these lots were scattered around the neighbourhood (see Fig. 4.10), the UROT only managed to assemble ten residential blocks (8% of the total). Nevertheless, they started to prepare for implementation on these blocks (Andalib 2010). The third stage, predevelopment preparation, comprised three processes, with the KBRP local office providing support for each process. First was preparing architectural plans and planning applications, for which the local office established a unit to help the residents and expedite the process. As outlined by one of the developers, this unit helped dramatically with accelerating the usual municipality administrative processes and issuing free planning permits, which was a major incentive for developers (Interview 2010). Second was land assembly; this phase, in addition to creating significant social problems, had major legal issues. Most of the properties in the rundown neighbourhoods of Tehran do not have land titles, and those that had titles had many legal issues. Third was interim housing during the course of construction; in this regard the UROT secured interest-free loans for residential and commercial properties, helping residents to rent accommodations during the implementation period (Andalib 2010).

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Fig. 4.10 Partial land assemblies in Khoob-Bakht (Picture by author, 2010)

A branch of the Municipality Bank (Bank e Shahr) was opened in the neighbourhood to facilitate the process of providing these loans. The loans varied between 10 and 15 million tomans (6,060–9,090 GBP)5 for each unit. Also a housing committee was established to assist residents in finding appropriate accommodation in the proximity of the neighbourhood, and in some cases helped residents with moving. While there were only a few commercial units, they also received the required rent to lease another location during implementation (Interview 2010). The implementation stage started with the demolition of the existing buildings. At the same time, the local office was trying to attract private developers to develop these assembled lots. The projects faced numerous problems during implementation. For example, the narrow alleyways were a major constraint for construction works, with the dilapidated infrastructure under the roads requiring extra attention. Further, 5

The exchange rate is calculated based on the exchange rate at the time of the interviews in September 2010, when 1 GBP = 1,650 tomans.

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Fig. 4.11 New developments versus those who resisted development in Khoob-Bakht (Picture by author, 2010)

the new master plan had eliminated some of the roads and had replaced them with housing, but as there was infrastructure underneath these roads, no development could proceed until all the residents of the surrounding buildings agreed to evacuate their houses. This caused major delays in proceeding with developments (Andalib 2010) (Fig. 4.11). In the final stage, the completed units were delivered to the previous residents. The major barrier in this phase was issuing the new title deeds for the completed developments. Due to the aforementioned issues with the existing titles, as well as the legal problems in issuing titles for assembled lots, this proved to be an onerous and time-consuming process, which the local office is still involved in to date (Andalib 2010) (Fig. 4.12).

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Fig. 4.12 New units delivered to previous residents of Khoob-Bakht (Picture by author, 2010)

4.5 Implementation of Comprehensive Redevelopment In order to analyse the process of regeneration, this section starts by exploring how and in what conditions the project was implemented.6 The institutional framework within which the project operated as well as the dynamics between different actors are outlined. Then the section moves on to participation in regeneration, discussing the attempts made to engage the residents. Finally, it outlines the land assembly issues as the main policy for implementation of regeneration in Khoob-Bakht. The absence of predevelopment studies regarding residents’ willingness to participate in regeneration, as well as severe mistrust from the public towards the regeneration officials, were predicaments to implementation prior to the start of the project. The director of the KBRP local office states: “We did not know prior to starting the project, once we proceed with this model of regeneration, what percentage of residents would agree with it, and those who are against it, why they are against the project?... We found out about the reasons later on, but it was too late to change the

6

Please note that this section does not jump to the fourth stage of Andalib’s classification (implementation stage) outlined above. Rather it looks at the whole process, but in a different order, to give a better understanding of the key issues and provide a framework for analysis in the following chapter.

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approach” (Interview 2010). Another problem was that there were no provisions for those who did not want to participate in this project. Throughout the project there was a severe mistrust from residents towards the municipality and the UROT. The Deputy Director of KBRP recalls: Residents believed that the UROT will purchase the land very cheaply from them and will make them homeless, stating that the UROT is implementing an Israeli policy towards them7 … there have been a few demonstrations with up to 100–200 people. When the Mayor of Tehran went to Khoob-Bakht to inaugurate the project, residents did not allow him to proceed, and he had to run away with a motorcycle to avoid confrontation. (Interview 2010)

One of the first developers points out that one of their employees was knifed by criminals early on in the project, as they felt that the new projects, by changing the character of the neighbourhood, would no longer allow them to continue their illegal activities (Interview 2010). In their research, Aminzadeh and Rezabeigi (2012) analysed the participation of residents in the Khoob-Bakht regeneration project, and highlighted that in the project’s scope of work, public participation was only contemplated as part of the process of implementation. They argue that engaging the residents during the decision-making process could have increased their trust towards the public authorities, while at the same time could have helped the UROT in better understanding the issues on the ground. As such, they argue that sufficient due diligence was not undertaken in order to prepare the residents for the project and to provide a better understanding of the neighbourhood issues to the UROT (Aminzadeh and Rezabeigi 2012). The director of the KBRP social unit points out that due to the previous demolitions for the proposed highway construction and changes in the proposed highway route, residents experienced uncertainty and destruction in their neighbourhood for a few years, amplifying their mistrust. This attitude only started to improve once they realised that new projects were being built (Interview 2010).

4.5.1 Institutional Arrangements and the Actors Involved The following were the major actors who shaped the regeneration process in KhoobBakht: the UROT, as the body responsible for implementation of the project that was a branch out of the municipality of Tehran; private developers who were working with the UROT in developing different projects; and residents whose neighbourhood was being regenerated. There were other public organisations that could have been involved, but were mainly sidelined. The deputy director of the KBRP mentions that the UROT saw itself as the sole actor in this process, and while other organisations were not participating, the UROT did not put enough effort into bringing them on board. He recalls: 7

For clarification, the interviewee here is referring to the housing demolition and displacement policy of Israel in occupied territories.

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4 Khoob-Bakht Comprehensive Redevelopment … The municipality as well as other organisations in charge of utilities such as water, gas and electricity were only doing their routine work. The land registry was a major actor, which was not cooperating in any special sense. Education organisations were supposed to build schools, but were not doing so. (Interview 2010)

The director of the KBRP social unit also believed that the UROT should not have involved itself to this extent in the process, mentioning that “residents’ houses is [sic] their main possession, as these people live their whole life to acquire the houses that they have today. As such, excluding them from the decision-making is not conducive to the project’s success” (Interview 2010). On the other hand, the director of the KBRP plan believed that the required frameworks for people to play their role are not present: “There is no organisation or framework in place within which people can participate,” he said (Interview 2010). Nevertheless, as the project proceeded, residents played a more significant role, with all the land assemblies taking place with residents’ consent. In terms of institutional arrangements, there were tensions between various organisations that had a stake in this process. Nevertheless, the UROT made every effort to further the process in different circumstances. The director of the KBRP plan indicates that the UROT was structured in a productive way and different units were cooperating effectively within the organisation. However, he states: The major institutional problem was that UROT saw themselves as the sole actor in this process, and did not bring other related institutions on board. This approach dramatically increased the cost of regeneration for the UROT, and as a result made this approach irreplicable as an exemplar, contrary to what was originally intended. (Interview 2010)

In other words, the major institutional problem was interorganisational and not intraorganisational. In order to avoid significant delays, the UROT made many decisions itself in situations in which they needed to wait for other organisations input. The deputy director of KBRP puts it this way: If it took the municipality a few months to issue planning permit we would build without planning permit. If the Land Registry was not ready to issue titles for assembled lots, we would proceed and build. When we were building a new road and the utility organisations (power, water, gas, etc.) told us that we have to wait one to two years in line to get the necessary infrastructure, we would pay for it from our own (UROT) budget and go ahead with the project. (Interview 2010)

Director of KBRP plan points out that some organisations were even causing difficulties along the way. “This mainly happened during the implementation process by different organisations both within and outside the municipality. Some of these issues were resolved as the project moved forward, and with the establishment of the local office, operations became smoother” (Interview 2010; see also Tavakoli 2011). One of the first developers states that many of the problems they faced as the first developers, particularly problems between the municipality and the UROT, as the main institutional issue for them, were resolved as the project progressed (Interview 2010). The director of the KBRP local office suggested that all the relevant organisations should have had an office on site in order to make the process smoother

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(Interview 2010). One of the developers goes further and states that regeneration projects are beyond the municipality’s authority, requiring an organisation similar to a small government to be in place. “For example, issues like the security of the neighbourhood, which is now a major problem in Khoob-Bakht, is not related to the municipality and concerns the police. Major infrastructure provisions is another matter that relates to other organisations” (Interview 2010). Later on in the project, a major institutional problem that happened was the change in the management of the UROT. The director of the KBRP social unit recalls: This had negative impacts, as the structure of the organisation changed dramatically. In Iran when a manager is replaced, the lower level management along with other senior professionals change with them as well. This affected the project significantly, as some of the previous managers made verbal commitments to residents, however, the new management was only responsive to written commitments. It also took the new management some time to familiarise themselves with the project, causing a major break in the project momentum. Unfortunately this break happened during summer, when most of the participation could have taken place, as it is much easier for families to move during school holidays. (Interview 2010)

On the same issues, the first director of the UROT, Andalib, underscores that generally in Iran in many organisations the management has a significant impact on the direction of the organisation it leads, and with a change in management the organisation would change course as well. Specifically, he highlights that regeneration in Khoob-Bakht was not institutionalised and was significantly affected by the change in management. Further, District 15 of Tehran (within which Khoob-Bakht is located) saw four different mayors during the Khoob-Bakht regeneration, and given the responsibility overlaps with the municipality, this added to the uncertainties surrounding the project. He also highlights that the lack of clarity in the scope of work of other organisations involved in regeneration, the disconnect between various levels of planning from national to regional and local, as well as lack of relevant experience of the city managers—as many were transferred from other unrelated governmental organisations—were major contributors to the institutional problems that Khoob-Bakht experienced (Tavakoli 2011).

4.5.2 Participation in Comprehensive Redevelopment The Khoob-Bakht project could be named as one of the first attempts to engage the public in a regeneration process in a country where public participation is not yet institutionalised. However, this was an attempt with numerous flaws, ranging from the way in which the public was consulted to the rush for implementation. The regeneration plan was solely prepared by a group of experts, consulting the public only during the implementation stage. This comprised three public meetings, thirty-two group meetings with around ten to fifteen residents in each meeting group, and numerous private meetings with residents (Interview 2010).

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In many circumstances these consultations resulted in altering the proposals, especially in the land assembly procedures. Initially the UROT envisaged that surrounding neighbours should come together to assemble adjacent lots; however, since many neighbours were reluctant to participate with their adjacent neighbours, the UROT had to change the defined boundaries of the land assembly. In the initial proposal, around twenty lots had to be assembled to constitute one project, but eventually, after seeing the complexities, this was reduced to two to three lots in some places (Interview 2010). Public consultations brought up other issues that were not realised prior to these meetings as well. For example, paying rent to commercial units during the implementation process so that they can rent an alternative location resulted from these meetings. Further, there were many housewives who were working at home providing domestic tasks for other households such as cooking or chopping vegetables. The UROT allocated a monthly payment to them until their new homes became ready (Interview 2010). The director of the KBRP plan points out that due to the political pressures and the involvement of the mayor, the project was in the media spotlight. Therefore, there was an urge for implementation, which did not leave enough room for consultation (Interview 2010). The deputy director of KBRP mentions that the objective was only to talk to people to convince them to participate in the project, as it was the first time that the UROT was not purchasing land from residents and acquiring land only through participation (Interview 2010).8 In their research, Aminzadeh and Rezabeigi (2012) state that one of the main issues with regard to the residents’ participation within the regeneration of KhoobBakht was the lack of legal and regulatory frameworks, which could have provided a platform for public participation (Aminzadeh and Rezabeigi 2012). Rezaii (2008) categorises those who were not willing to participate and were against the Khoob-Bakht project in the following groups: • • • • • • • • •

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residents who did not trust the public authorities; older residents who resisted change in the neighbourhood; residents who were more traditional and did not like the apartment-living lifestyle; criminals who were considering Khoob-Bakht as their safe heaven, worrying that it would get transformed with new developments; owners of the newly built units whose unit values would be affected by the extensive period of redevelopment and the potential of their units being part of the redevelopment plans; residents with opportunistic behaviour, seeking higher than the market value of their property; retailers who saw this process as interrupting their business; residents who did not agree with the approach of the project; and residents who were not well informed about the project (Rezaii 2008).

Some purchases happened for the initial highway project.

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• Tavakoli (2011) adds tenants to this group, as they were completely dismissed in the regeneration process. Tenants in many cases refused to provide the owners’ contact information to the UROT, causing significant delays in finding the owners (Tavakoli 2011).

4.5.3 Land Assembly As the majority of the neighbourhood was comprised of small lots, some as small as 50 square metres, land assembly seemed to be the best approach for redevelopment. However, this process proved to be the major predicament as outlined in this section. The initial approach envisaged at least five adjacent lots to be assembled in order to form a new feasible building block. However, as the deputy director of the KBRP mentions: “When the process started, not all the adjacent neighbours that were assigned together were convinced to participate in the project, with a few objections in most of the cases. Many did not like their neighbours, refusing to enter into a partnership with them. There were also cases were the owners could not be found” (Interview 2010). In some other cases where people agreed to form a block, lots were located at the end of a narrow road, and it was not possible to start a construction project in that location (Fig. 4.13).

Fig. 4.13 Demolitions for land assembly in Khoob-Bakht (Picture by author, 2010)

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As this extended into a lengthy process, even those who agreed to participate in the first place started to change their minds. As such, the UROT decided to bring every person who agreed to participate on board, freeing the lots one by one, rather than whole assembled blocks. In some places the UROT altered the boundaries of the initial proposed land assemblies in order to define meaningful projects. Nevertheless, in many cases the lots that were freed could not be assembled, and the owners were accommodated in other projects. While the UROT showed some flexibility in the land assembly plans, this flexibility was not extended to other aspects of the project, i.e., no additional density or rezoning was granted to attract developers (Interview 2010). Another problem with the land assembly was the land titles, as many lots had communal (Mosha) titles.9 When lots with communal titles are assembled, new titles cannot be issued for the new units. This is a major issue in regulations nationwide, but it specifically proved problematic in Khoob-Bakht (Interview 2010). At the time of the research, partial assemblies dominated the neighbourhood, with the UROT owning many lots in the middle of half-assembled blocks. The UROT’s approach to these remaining empty lots is to first offer them to their adjacent neighbours in the block. The neighbours have the option of assembling the empty lots with their lot, building a project and providing units equivalent to the value of the land to the UROT. For example, in a block with six lots, where four lots are freed and two lots still have residents, the residents have the option of taking the four lots, assembling the whole project, and giving back four units to the UROT. If the residents do not agree to proceed on this basis, then the UROT seeks to involve the judiciary system to free the remaining lots, the director of the KBRP indicates (Interview 2010). Aminzadeh and Rezabeigi (2012), in their research on Khoob-Bakht, also highlight that the project has completely changed the urban structure of the neighbourhood, creating abandoned spaces due to the partial land assemblies. This implementation strategy has significantly affected the liveliness of the neighbourhood, resulting in many residents leaving the neighbourhood, as well as amplifying distrust towards the UROT and the city authorities more generally (Aminzadeh and Rezabeigi 2012).

4.5.4 Social Issues in Implementation Social issues associated with the redevelopment created many problems. Although the KBRP social unit made some attempts to engage with the residents, there were major underlying social problems. Mistrust towards the municipality, interest-free loans for interim housing, as well as social issues associated with moving from singlefamily houses to apartments were amongst the main social issues and are explored in this section. 9

Communal title is a title that is issued when a lot is subdivided, with the subdivided lots not legally registered. All the owners are part of a larger communal title, and the title does not allow the individual owners to rebuild, which is a common problem in run-down neighbourhoods.

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The KBRP social unit was involved with several community activities in the neighbourhood. A community centre was set up and a few classes were organised, including painting, storytelling, and film classes for children; sewing classes for women (with around seventy people attending); and first aid classes with Iranian Red Crescent, which were some of the most popular ones with around 350 people attending. They also organised classes regarding earthquake resilience and drug addiction. A day care centre with free snacks for children was set up in the community centre to avoid children being exposed to the rough conditions on the street. Director of the KBRP social unit recalls: “Children were playing on the streets in a terrible situation. They were exposed to drug use on the streets, playing ball games barefoot, having to pick their ball from gutters with injection syringes, mice and other pollutants...” (Interview 2010). The interest-free loans that were paid to residents for their interim housing requirements became one of the major problems. The deputy director of KBRP states: Someone who was living in Khoob-Bakht, was living in a 30 square metre home with an exterior kitchen and toilet in the corner of the backyard shared with other neighbour(s). As they were looking to rent a place outside the neighbourhood, we estimated the rent loans based on renting a decent place. For example, if they were renting their place in KhoobBakht the rahn10 (rental deposit) would be approximately 5 million tomans (3,030 GBP) per annum, but we paid them a 15 million toman (9,090 GBP) rahn. They suddenly had a large sum of money in their possession, which they were not used to. As such, they would only spend 5 million tomans (3,030 GBP) on rent, spending the rest 10 million tomans (6,060 GBP) on other expenses, such as buying a car and other matters…. Once the new residential units were ready and we asked them to return the loans, we realised that no one had the sum that they had borrowed to pay back.

The director of the KBRP social unit points out that some residents tried to make all their dreams come true with this money: This money for the period of the project, even changed some people’s lifestyle … some are now selling their new units to live somewhere cheaper, so they have extra money to live the way they lived during that two year period … for some residents with drug addiction it increased their drug consumption … we had their wives or mothers coming here, complaining that since they received this loan they are consuming more drugs … (Interview 2010)

Another problem was adapting to the more communal way of living in apartments. Walking down the corridors of the new apartments, they are used the same way that the old alleys in Khoob-Bakht were treated: with doors wide open and curtains covering their entrance. Many of the routines that residents used to have when living in a house were no longer possible in an apartment building (Fig. 4.14). One of the major hobbies of Khoob-Bakht residents used to be pigeon racing, which took place on the rooftops of their houses. After moving to apartments, pigeon 10

Due to Iran’s high inflation economy, the value of Iranian currency constantly drops, with the bank interest rates varying between 15 and 20% per annum. A common method for rental payment in Iran is rahn or rental deposit, which is a lump sum of money that is paid as a deposit to the landlord with its interest income acting as rent. At the end of the lease term the rental deposit is returned to the tenant.

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Fig. 4.14 Old versus new housing in Khoob-Bakht (Source Author 2010)

racing created many problems for other neighbours and created much dissatisfaction amongst them, director of KBRP social unit recalls. Further, many housewives were working at home, preparing foods like pickles and other domestic products for sale. This was not possible once they moved into an apartment, due to odours and the need for open space (Interview 2010). One of the developers mentioned that many residents were used to washing their carpets on their rooftop or hanging their laundry in their courtyard, and these habits were also no longer possible when living in an apartment: There were some residents who wanted to set up carpet weaving in their parking lot, creating a lot noise … Some men are drug addicts, the smell of drugs and all its related problems annoys neighbours. There are women who are prostitutes, when living in a house the numerous daily visits would not bother anyone, but now in an apartment it is disturbing … On the one hand you have people with a secular lifestyle and on the other hand extremely religious people, they do not go well together. Communal living brings all these issues to the surface.” (Interview 2010)

Another social problem in this part of town is that when people face a problem they attempt to solve it themselves as opposed to reporting it to the relevant authorities. Developer B recalls an example when “a truck that was working here for construction was making some dust and noise, residents mentioned this to us and we apologised to them... when the noise continued, as opposed to reporting the problem to the police or the municipality, they got into a fight with the truck driver...” (Interview 2010).

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Aminzadeh and Rezabeigi (2012), as part of their research on Khoob-Bakht, conducted roundtables with the residents regarding the issues that they experienced with the implementation of the regeneration project, confirming many of the issues outlined above. The main issue that the residents highlighted was the lack of security in the neighbourhood, which can be mainly attributed to the long process of regeneration and the abandoned properties as a result of the incomplete land assemblies. Further, the residents also mentioned the lack of trust that existed amongst the residents towards the public authorities based on previous negative experiences. Other issues that they raised include problems with apartment living (i.e., a multiplicity of households in one apartment unit, as well as proximity to people with drug addiction and other social problems), land titles issues, insufficient public outreach and lack of clarity on the project, and categorising the workshops that existed in the neighbourhood pre-redevelopment as disturbing activities for a residential neighbourhood, eliminating income of some households. Residents believed that all these issues contributed to the lack of participation in the implementation process (Aminzadeh and Rezabeigi 2012).

4.6 Property Development in Comprehensive Redevelopment As outlined earlier, successful property development is a critical aspect of physical regeneration. While the development aspect is important for the public sector, it becomes more significant when the private sector is involved. In the case of KhoobBakht, the UROT, as a public organisation, was a key actor in the implementation and subsidising developments, while private developers were responsible for building individual projects. This section, after outlining the context within which the projects took place, discusses the UROT’s efforts in attracting private developers with the incentive structure that was put in place. Then the types of development that functioned better, as well as the numerous problems that the developments faced, are spelled out. Finally, the impact of the property market as an external factor on redevelopments is considered. Given the number of actors that are involved in a regeneration project, successful implementation is dependent upon creating win–win situations. Developer A, one of the first developers, believes to some extent that Khoob-Bakht has achieved this: “I, as a developer, benefited financially in this process, residents had their run-down buildings replaced with new and earthquake resilient buildings, and the municipality utilised the potential and capital of the private sector for a public good” (Developer A 2010). The UROT, as the main actor, defined the regeneration process. The director of the KBRP states that the UROT’s main aim in regeneration was to assemble land and renew the old housing stock, stating that building nonresidential land uses was outside the UROT’s scope, as the municipality had separate financial resources through taxes

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for them. Further, he indicated that the UROT did not have a policy to build extra units for sale, in order to cross-finance other projects. The units that were built were for the sole purpose of rehousing the residents whose land was acquired. However, he highlights that the main cost of building a road or park in inner-city areas is assembling the land rather than the construction cost itself (Interview 2010). Land for public nonresidential land uses used to be assembled through compulsory purchase, but now it is being implemented through Nosazan projects as a new approach, within which new housing is built in the proximity of the acquired land for residents as opposed to only paying them for their land (Fig. 4.15) (Kashef Haghighi et al. 2010). In order to attract private developers to Khoob-Bakht projects, a public invitation was issued, outlining the project details, with a copy of the development agreement. The UROT received many responses, but some withdrew their proposals once they had a better understanding of the conditions and the area, while others were dismissed due to lack of credentials. Finally, fifteen developers were shortlisted to undertake different projects. These were mainly small- to medium-size developers, with moderate financial capabilities, which was one of the reasons that they were interested in this part of town in the first place. The UROT avoided giving more than one project to each developer, so that it could manage the overall project’s exposure to a developer’s performance and lower the risk in case a developer faced problems (Interview 2010).

Fig. 4.15 One of the Nosazan projects in Khoob-Bakht (Source Author 2010)

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The pioneering developers had a more challenging task. One of the first developers indicates that seeing other projects that had already started had a major impact on their decision to start, suggesting that their predecessors had already solved some problems (Interview 2010). In order to facilitate their operations, developers formed an informal consortium amongst the ten to eleven firms that were active at the time to work in synergy. For example, they appointed a representative who was mainly dealing with the UROT on their behalf, and they managed to get better prices for construction materials by purchasing in larger quantities, achieving economies of scale. They also reached agreements for setting labour wages in the neighbourhood (Interview 2010) (Figs. 4.16 and 4.17).

Fig. 4.16 Developer A project: Developer A was one of the first developers in Khoob-Bakht. He developed a lot that was assembled by the UROT from sixteen smaller lots. After the lot was delivered to him, the project took two years to complete, as it experienced some interruptions due to late payments by the UROT (Source Author 2010)

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Fig. 4.17 Developer B Project: Developer B developed two projects in Khoob-Bakht, a 1,340 square metre residential project with fourteen residential units, and a 2,800 square metre mixeduse project with twenty-four residential units and eight commercial units. Each project took approximately a year and a half to complete (Source Author 2010)

4.6.1 Incentive Structure As Khoob-Bakht was located in a lower-end area of Tehran, and developers were not familiar with the regeneration process, the UROT tried many different strategies to attract private developers towards this area and this project. Developments faced many problems, including problems with their titles, and as a result initially the UROT had to be more facilitative. For example, they were prepurchasing the units from the developers, but had to stop this later on as it did not prove to be a financially viable option for them. This section looks at these facilitative measures, starting with the level of flexibility that the UROT showed towards the developers, outlining the type of contracts that were signed between the UROT and the developers, along with the incentives and purchase guarantees, and the role that the financial system played in this process. In terms of flexibility towards the developers, the UROT was not very flexible in cases in which the developers wanted to deviate from the plans. The director of the KBRP plan points out that the master plan that was approved did not leave any room for flexibility at a later stage. However, he mentions that because they were aware

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that urban development plans in Iran rarely become implemented,11 the proposal took into account profitable and catalyst projects when the plan was being prepared. Hence, once the project was approved, being flexible towards developers was not the UROT’s policy (Interview 2010; see also Tavakoli 2011). The director of the KBRP local office reaffirms that there was not much room for flexibility in the project, recalling only one project where a developer was investing in an undesirable project, and in order to attract them, their share in the development was slightly increased (Interview 2010). The development contracts were signed between the developer and landowners (with the UROT acting as the landowners’ representative). The UROT, in collaboration with the municipality, provided free planning permits and an extra storey of density for developments (i.e., five storeys were allowed rather than the usual four-storey regulation). Initially many developers feared that if they invested in the projects there would not be sufficient demand in the area. Given that Khoob-Bakht was under redevelopment plans, most people wanted to sell and leave, and not many people were interested in purchasing property there. The UROT had to reverse this cycle; as such, they guaranteed the purchase of the developed units as the buyer of last resort, and in most cases they purchased the units in advance from developers (Interview 2010). However, in many cases the value of these purchases, rather than cash, was provided to developers through free planning permits or land in other parts of the city (Interview 2010) (Fig. 4.18). Developers in Iran generally do not raise the whole cost of a project in advance, the head of UROT investments states. They typically invest around 10% at the beginning, obtain a loan for around 40% of the costs and preselling the units to raise the remaining 40–50% of capital costs. The absence of loans from banks and a market for preselling the units were other reasons that the UROT had to create a market for the developers and prepurchase units (Interview 2010). The issues with the titles could be named as the main reason why the purchase guarantees were essential for developers. Given that many of the Khoob-Bakht lots had communal titles, developers were not able to get loans from banks on the communal titles, and more importantly they were not able to get individual titles for units when they wanted to sell them. This issue was outside the UROT’s scope of work, as it is a Land Registry matter. To date these projects do not have planning permits, nor land titles for the assembled lots, and as a result divided titles were not issued for the new apartment units.12 Developer A (one of the developers) mentions that if the title issue gets resolved they are ready to start more projects immediately, as they are familiar with the area and know how to operate in Khoob-Bakht (Interview 2010). Developer B, believing that the purchase guarantees stopped too early, suggested that the UROT should have continued this policy, perhaps at a less generous price, 11

This could be mainly attributed to the lack of feasibility and financial studies for proposed schemes. 12 In the Iran Land Registry system, in order to obtain titles for new apartments, first the developer needs to acquire a planning permit for the project that they want to build. If the project requires land assembly, then an assembled title also needs to be issued for the assembled lots. Then, once these are in place, the developer can ask for individual titles for the new apartment units.

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Fig. 4.18 One of the new projects in Khoob-Bakht (Source Author 2010)

until a more considerable area of the neighbourhood was redeveloped, and then the market would have attracted developers to redevelop the rest. Another criticism of the purchase guarantee process was that all the projects were priced at the same level regardless of the quality of the project, discouraging those who were building better-quality product (Interview 2010). In Tehran, when developers and landowners form a joint venture to develop a project, there is generally a fifty-fifty division of the final units. Although this is a typical practice in Tehran, it is usually adjusted based on specific cases. Given that the price of land in Khoob-Bakht was significantly lower compared to other parts of Tehran, it was not profitable for developers to enter into those types of agreements. As such, the UROT had to pay a premium in order to attract developers to the area (Interview 2010). For example, Developer B mentions that, in his agreement, the landowner’s share was 45.5% and the developer’s share was 54.5%. This was a typical agreement in Khoob-Bakht, with the highest percentage for developers estimated at 57%. In the cases in which there were a few commercial units, developers had no stake in those, as they were considered the landowner and municipality’s share (Interview 2010). On the other hand, the UROT had a formula that promised residents approximately 1.2 times the gross area of their land in new apartment units. The standard 50–50% ratio, or in Khoob-Bakht’s case, 55–45% ratio between developer and landowner, is not based on such a formula. Given that this was a generous offering

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to residents, the UROT had to subsidise any additional square metres from their own resources (Interview 2010). Assembling land by the UROT, which eliminated negotiation with multiple landowners, was a major element in attracting private investment, Developer A believes (Interview 2010). Another major element, in Developer B’s opinion, was free planning permits. “Normally it takes around five months to obtain planning permit[s] for a project like this, but in the case of Khoob-Bakht, since the UROT was in charge of these issues, developers did not need to be concerned about it” (Interview 2010). However, the banking system did not support the redevelopment projects in a meaningful way. The deputy director of the KBRP believed that the banking system should play a more significant role in redevelopment of run-down areas by offering low-interest loans, which did not happen in Khoob-Bakht. Currently, the Housing Bank of Iran is offering 20 million toman (12,121 GBP) loans for each unit, which can be increased to 25 million tomans (15,151 GBP) if new technologies are used in construction. Nevertheless, this is not a consistent approach by banks, as they offer these loans for a month only to stop them a few months later (Interview 2010). Developers also believed that in the absence of a purchase guarantee, the Housing Bank loans could be instrumental in attracting investments to this area (Interview 2010). Developers were attracted to the Khoob-Bakht project to some extent in the light of future opportunities in other regeneration projects. Having already received a few offers from regeneration organisations in other districts, Developer A points out that this project is a useful addition to their resume when they apply for government or municipality projects due to the extensive government involvement in development projects (Interview 2010). Developer B also confirms that this project had a positive impact on their resume for other municipality-related jobs, especially since they were amongst the first developers who were involved in regeneration projects, and there are many other regeneration opportunities in Tehran. However, he mentions that when he applies for higher-end projects he does not mention his Khoob-Bakht experience. Although in terms of building structure these projects may even have a higher quality, their interiors and finishing are of lower quality (Interview 2010).

4.6.2 Developments That Worked in Khoob-Bakht and Problems They Faced As discussed earlier, each regeneration project requires a unique approach towards developments due to its surrounding circumstances. For example, with regard to the size of the units, the current proposals seemed too generous for the area. The director of the KBRP local office points out that “Currently many residents are living in 30 square metre units, while the new units vary between 70 and 100 square metres. In order to lower the costs of regeneration, smaller unit sizes should be provided”

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(Interview 2010). This, the director of the KBRP local office, would create a more affordable and similar approach to the previous housing. Developer A, has a similar view, indicated that the UROT claimed that approximately 70% of the Khoob-Bakht units were under 60 square metres, and the demand is for under 60 square metres by the majority of residents. With regard to the number of units per apartment, Developer A mentioned that “many people, when they wanted to get a unit in our building, said that a building with 37 units is too crowded … As such, the new developments should be on a smaller scale and more similar to their previous way of living” (Interview 2010). Developer B also believed that due to the problems in social interaction between neighbours, it is best to reduce the total number of units per apartment building (Interview 2010). There has also been a lack of attention to other land uses. Developer B states that, with a few exceptions, most of the developments have been mainly focused on housing. It is important to have commercial units alongside residential units to bring liveliness to the area, and also recreational elements, especially for children, are critical here, as there are many families living in these buildings. Further, as residents were used to living in houses with courtyards, it is really important to consider courtyards and green spaces within the new buildings (Interview 2010). With regard to what did not work in Khoob-Bakht, generally run-down areas do not have a positive reputation amongst developers in Tehran. In the case of Khoob-Bakht specifically, this can be attributed to the following items: social issues associated with run-down areas, construction problems in dense urban fabrics, return on investment, and the lengthy process of regeneration, which are discussed in more detail herein. Social issues were a major investment problem in Khoob-Bakht. Developer A states: “If residents were cooperating along the way many problems would have been solved” (Interview 2010). In Developer B’s project, there were three to four disputed lots that delayed the project significantly, resulting in the project being built in two phases, increasing the cost of development. As these landowners realised that the project required their land in order to proceed, it proved more challenging to convince them, as they were increasing their asking price. Finally, the UROT did not manage to solve this issue, with the developer having to pay extra money to convince them. In the same project, Developer B recalls that there was a building at the end of a narrow alleyway that was blocked due to the construction work in Developer B’s project, causing major altercations to the extent that had to be solved by the police (Interview 2010). The second item is construction-related problems in run-down areas. Developer B indicates that the location of a lot in run-down urban fabric plays a significant role in its construction feasibility. The surrounding roads need to be wide enough to allow construction work to proceed. For example, in many narrow alleys of rundown areas, where a truck can barely fit to deliver construction materials, it is not operational to build a project. Another issue is the utilities (i.e., electricity and water) that are required for a construction project. Typically, when a lot is redeveloped, utilities from the previous buildings on site can be used for construction. However, due to the long land assembly process, there was a major gap between demolition and construction, resulting in utilities being disconnected and requiring a lengthy

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process of reconnection (Interview 2010). Further, the condition and stability of the surrounding buildings is also an area of concern. Given the foundational instability of neighbouring buildings, excavation works need to proceed with extreme caution to avoid causing these buildings to collapse (Interview 2010). The third problem is with regard to a developer’s return on investment, as it compares to other opportunities in Tehran. The image of a neighbourhood plays an important role when marketing a development. As one of the developers outlines, “When an area is completely demolished and built from scratch, then potential buyers have no negative preconceptions. But when there are run-down buildings all around the neighbourhood, this affects people’s perception about an area, impacting the saleability of properties” (Interview 2010). The director of the KBRP local office states that they have been trying to attract investors, drawing their attention to the future potential of the area and marketing it as a neighbourhood in transition. However, the property prices were significantly lower in Khoob-Bakht, with at least a 20% price difference compared to the other side of the road that borders Khoob-Bakht, making it harder to attract investors (Interview 2010). Further, in higher-end locations, when developers are not able to sell their units upon completion, they often rent them, generating a reasonable income stream until they find a purchaser. However, in run-down neighbourhoods, developers believe it is not worth renting out their properties, as lower-income tenants do not usually take good care of the units, which increases maintenance costs, and rents are not high enough to compensate for it. As such, in cases where they cannot find buyers upon completion, they would hold on to the property, extending the return period on their investment (Interview 2010). On the other hand, the head of UROT investments believes that one of the benefits of investing in regeneration projects, as opposed to upmarket locations, is that investments are divided into smaller assets, as the final units are smaller in size and lower in price. As such, they could be traded more easily than larger assets in upmarket locations, which can be especially helpful during recessions, as they would be affordable to a larger population (Interview 2010). The fourth item, related to return on investment, is the lengthy process of regeneration, which discouraged many investors. There are a number of elements that contributed to this prolonged process. In the view of the deputy director of KBRP, land assembly was the lengthiest of the processes in Khoob-Bakht, due to the extensive negotiation that it required. Further, later on in the process in 2008, the UROT did not manage to pay its share to developers, which resulted in halting many projects; it took about a year before the UROT acquired more funds to restart the projects (Interview 2010). The director of the KBRP plan considers realigning the road layout to have been a time-consuming strategy, due to the required realignment of underlying utilities (Interview 2010). In some cases, there were projects that were built in the midst of occupied houses, and the main water pipe, for example, could not reach the new developments, as there were old buildings in its way. Developer B believes that required infrastructure was not in place prior to the start of the project (Interview 2010). In other cases, some projects, including Nosazan projects, which were in the

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larger Imam Ali region, faced delays due to an increase in construction material prices, including cement (Interview 2010). The first director of the UROT, Andalib, mentions that more generally the uncertainties surrounding the regeneration plan discouraged many investors, and as such the UROT did not manage to secure as much investment as it had expected. Further, he mentions that there were uncertainties regarding the financial resources that were available to the UROT, and the UROT was not able to plan based on a clear budget. As a result of this shortfall in financial resources, some projects were left incomplete, creating dissatisfaction amongst residents (Tavakoli 2011).

4.6.3 Comprehensive Redevelopment and the Property Market As discussed in the literature review, property markets impact the way in which regeneration projects operate. The Khoob-Bakht project was affected by both the citywide and local property markets. Initially, many developers became interested in the project. However, as the director of the KBRP local office recalls, “The problem started when the recession occurred in early 2009. We examined different solutions, and finally we concluded that the best solution is to offer purchase guarantees to provide certainty to developers that they can sell their units...” (Interview 2010). Property market booms generally encourage developers to invest, even in rundown areas. Developer A mentions that, while they would prefer an active property market, they would invest in recessions as well but in a more limited capacity. With regard to a developer’s profit expectation in an inflation economy with bank interest rates at around 20%, he indicated that they would expect 40% or above per year due to the underlining risks of property development. Nevertheless, he stated that since they treat property development as their full-time job, and in order to keep their construction crew employed, they would also consider projects at less than 40% in slower times (Interview 2010). For Developer B, the circumstances were to some extent different, as the recession was key in attracting him to run-down areas due to limited opportunities elsewhere. Construction material prices were also significantly lower during the recession, which resulted in reduced development costs. This, Developer B believes, resulted in attracting many other developers to this project (Interview 2010). With regard to the local property market, the deputy director of KBRP believed that the regeneration project has not yet positively impacted the local property market, as it has been affected more significantly by the citywide reduction in property prices since early 2009. Further, as the area is under municipal redevelopment plans, other development activities have stopped due to uncertainties of the future. This has been the case in the whole Imam Ali region, and since 2010 the UROT has attempted to change this perception. The deputy director of KBRP believes that the

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potential positive impact of the Khoob-Bakht regeneration project on the surrounding neighbourhoods could come to light in the next few years (Interview 2010). The local rental market experienced a sharp rise in rents during the implementation of the Khoob-Bakht project. The reason for this sharp rise can be mainly attributed to the high demand for renting interim housing during the implementation period and the limited supply of the housing stock in the vicinity of Khoob-Bakht, where most residents wanted to stay. The director of the KBRP social unit highlights that this caused problems for finding interim housing and also resulted in increased rents for current tenants, pricing out some residents from these areas (Interview 2010).

4.7 Post-Completion Analysis As outlined earlier, the field study of the Khoob-Bakht Regeneration Project was undertaken during the implementation phase of the project from June to October 2010. In the summer of 2021 the neighbourhood was revisited to review any changes since the case study analysis. Further, a few scholars have reviewed the Khoob-Bakht regeneration experience over the past few years. As such, this section discusses the latest status of the neighbourhood as well as the analyses published on the KhoobBakht regeneration process. Massoud et al. (2019) in their study of construction permits in the Khoob-Bakht neighbourhood, by taking into account buildings with less than 10 years of age in 2016 census state that from 2006 to 2016 27% of the neighbourhood was rebuilt. From 2006 to 2011, 140 lots were rebuilt with a total of 20,500 square metres, and from 2011 to 2016, 65 more lots were rebuilt amounting to 17,200 square metres. They outline that in 2010 and 2011 Khoob-Bakht had a higher construction permit growth rate compared to district 15 and Tehran, with the same trend also visible in the land price growth of Khoob-Bakht. The following map, based on a satellite image in 2021, illustrates the lots where new buildings were constructed. This confirms the above assumption by Massoud et al. (2019) that just above a quarter of the neighbourhood was rebuilt as part of the regeneration project (Fig. 4.19). Naseri and Safari (2018) saw “a house for a house” programme as a success part of the regeneration project, providing new houses to residents in the same neighbourhood instead of the previous UROT compulsory purchase examples. Hajialiakbari (2020) also states that housing construction projects through private investment was a success, however, only a few public service projects were constructed (Hajialiakbari 2020). The following images illustrate new projects in the Khoob-Bakht neighbourhood in 2021 (Fig. 4.20). Massoud et al. (2019) by analyzing the census data outline that a general displacement of local residents and gentrification occurred in the Khoob-Bakht neighbourhood. The resident population of the larger Khoob-Bakht area decreased from 11,745 in 2006 to 9,254 residents in 2016, with the number of household declining from 3,670 to 2,395 over the same period. At the 2016 national census only 1,304 households had lived in the neighbourhood for more than 10 years. Massoud et al. (2019)

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Fig. 4.19 Khoob-Bakht redeveloped lots drawing in 2021 (Source Drawing created by author, base map from Google Maps 2021)

conclude that only 36% of the old residents still live in the neighbourhood and 64% are either displaced or replaced by new residents. They outline that this gentrification process occurred in two stages; first during the implementation period of the regeneration project, and second stage due to the property price increase that resulted from the completion of regeneration projects. Naseri and Safari (2018) analysed the structural causes of failure in the KhoobBakht Regeneration Project, and outlined that the inability of the state to take into account chaos-generating factors at the planning and implementation levels resulted in these failures. At the planning level there was a clear absence of institutionalisation of public participation. While establishing a local office that was in contact with residents was a novel and positive move, the relationship was top-down in nature. Participation was defined as obedience to previously decided plans with a clear prioritisation of physical over social aspects. Consultation with residents only started during the implementation phase, and in order to adapt to the resistance from residents, planners tried to change their plan a couple of times. Scattered empty lots throughout the

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Fig. 4.20 New residential projects in Khoob-Bakht in 2021 (Source Author 2021)

neighbourhood is one of the results of these changes in plans. Overall the regeneration project failed to overcome the deep distrust between residents and authorities. The following map and images illustrates the lot with demolished building that still sit empty in 2021 (Figs. 4.21 and 4.22). One of the major structural failures at the implementation level was the lack of coordination amongst various responsible authorities. Even within the municipality there were conflicts between departments and upstream plans. More importantly the project lacked a legal framework required for implementation (Naseri and Safari 2018). Hajialiakbari (2020) also outlines that the absence of a legal mandate for implementation for various responsible agencies together with a lack of coordination amongst them was a major shortcoming of the Khoob-Bakht regeneration project. Further, changes in management of the UROT and district 15 mayors created uncertainties that negatively affected public participation and private investment in the project. While Hajialiakbari (2020) calls for more public funding for implementation, Naseri and Safari (2018) believe that the project had an unsustainable financial mechanisms and no institutionalised mechanism for attacking investment which resulted in halts in implementation on numerous occasions (Naseri and Safari 2018). Naseri and Safari (2018) conclude that the Khoob-Bakht regeneration project failed to cope with the structural causes of failure. They outline that the project was unable to cope with the chaos-generating factors, which required structural

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Fig. 4.21 Khoob-Bakht empty lots drawing in 2021 (Source Drawing created by author, base map from Google Maps 2021)

differentiation and coordination in order to overcome these challenges. As such, internal and external forces made the project more vulnerable and intensified the chaos. Andalib and Hajialiakbari (2019) outline that following this experience the UROT has adopted a four phase policy for regeneration projects in Tehran to avoid the shortcomings of Khoob-Bakht. First, studying the existing conditions on the ground, second, extensive preparation and consultation for implementation, third, infrastructure provision and finally development phase (Andalib and Hajialiakbari 2019).

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Fig. 4.22 Empty lots in Khoob-Bakht in 2021 (Source Author 2021)

4.8 Conclusions As illustrated in the analytical framework diagram, the main problematic of this research was the situation of run-down neighbourhoods in Tehran, with regeneration being analysed as an approach to respond to this urban problem as one of the main issues in developing countries. This section discusses whether the Khoob-Bakht project has managed to respond to this issue as well as the other regeneration goals that were set out in the planning phase. As outlined earlier in this chapter, regeneration in Khoob-Bakht had a few main objectives, which included housing renewal as the main objective due to the potential risk of an earthquake, providing land uses that the neighbourhood lacked, and exploiting the potentials of the new Imam Ali highway (Interview 2010). However, these regeneration objectives do not necessarily correspond with the urban problems that existed in the neighbourhood and were identified earlier in this chapter. While some physical issues were addressed, the major social problems were not addressed. As such, similar to the problems that were outlined with “property-led urban regeneration” by Turok (1992) and Adair (1999), in the case of Khoob-Bakht physical issues took precedence over social issues in regeneration. With regard to exploiting the potentials of the new Imam Ali highway, the UROT moved away from the highway and its adjacent projects acting as catalysts for change

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to a project with the central aim of neighbourhood redevelopment. The director of the KBRP plan states that the reason for this shift was the similarity of this approach to the Navab project.13 As Navab is not seen as a positive experience in the public opinion, the UROT further believed that the funding that was secured for this project should be sufficient, dismissing the idea of catalyst projects (Interview 2010). The deputy director of the KBRP states that to date the project “has not mainly” achieved its objectives. With regard to providing the land uses that the neighbourhood lacked, the UROT proposed some land uses as part of the master plan, but based on the current planning system the relevant authorities had to build those proposed uses that were part of their sector.14 As such, apart from one sport centre that is under construction from the District 15 municipality budget, and one park (around 600 square metres) built from the UROT budget, the rest of the services have not materialised to date. As such, the potential regeneration spillover effects were not realised (Interview 2010). Hajialiakbari (2020) also highlights that only a few public service projects were constructed. With regard to housing renewal, the UROT managed to reach agreements with around 240 out of 650–700 lots that were in the area, resulting in approximately twenty-five projects comprising four hundred units that were built and given to previous residents. This can be named as the major achievement of this project, as residents of around four hundred units are living in higher-quality buildings that are earthquake resilient and are using an improved road network, allowing emergency vehicles to access each building (Interview 2010). Analysing 2016 census data (Massoud et al. 2019) and 2021 Google Maps satellite image (Fig. 4.19) confirms that just above a quarter of the neighbourhood was redeveloped as part of the regeneration project. The director of the KBRP plan states that in some aspects the problems have increased, including the social problems that have increased due to extensive demolitions and abandoned properties. He believes that once the project moves forward and is completed these issues will be resolved (Interview 2010). However, the postcompletion analysis demonstrates that these problems persisted 11 years later in 2021 (see Figs. 4.22 and 5.1). The director of the KBRP social unit was more negative and believed that more problems were created than solved, blaming the partial land assembly for the current situation: Alleys are destroyed, dead-ends are gone. The security of the neighbourhood has decreased significantly, now a woman cannot walk alone at night here. Drugs are used in public … the sanitary situation is really bad. Due to this lack of security, many residents have left the neighbourhood and rented their houses. Tenants who are replacing them are mainly illegal single male migrants, renting these areas at a very low price.” (Interview 2010)

13

See Chap. 2 for further details on the Navab project. Under the current planning system, the municipality proposes different land uses, and then the relevant authorities and ministries are responsible for building them without having the financial resources to do so. (For example, the Ministry of Education has to finance the school projects.) This mismatch between the proposals and available capital is a general problem in the planning system, and as a result most proposals do not materialise.

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With regard to creating a socially mixed neighbourhood, as the deputy director of the UROT points out, they planned the new neighbourhood for the same residents, and as such creating a mixed-income neighbourhood was not the aim of this regeneration project. Further, the UROT did not utilise the potential value that could have been created by building additional housing for sale in the neighbourhood, only seeing its objective as replacing the old housing stock. Nevertheless, as part of the larger project in the Imam Ali region, there were a number of Nosazan housing projects within which some units were replacement housing for Khoob-Bakht residents, and others were sold on the open market. This, as a result, brings new residents from possibly other social classes to the area, which might change the social mix in the wider area (Interview 2010). Anaylsing the 2016 census data shows that in the larger Khoob-Bakht area household numbers decreased approximately by 1,300 households compared to pre-regeneration numbers, with only 36% of residents in 2016 who had lived in the neighbourhood for more than 10 years (Massoud et al. 2019).

4.8.1 Wider Implications of the Project The Khoob-Bakht project has had wider institutional implications. As outlined in this section, the UROT has realised that it should move towards a more policy-oriented approach through facilitative policies, rather than project-oriented approaches that require implementing regeneration projects. The director of the KBRP plan highlights that facilitative policies that currently exist are a result of the efforts in Khoob-Bakht. One of these is free planning permits that the municipality is granting in run-down neighbourhoods across Tehran, which has significantly increased the number of planning permits in run-down areas (Interview 2010). The deputy director of KBRP highlights that Khoob-Bakht was the municipality’s first experience in intervening in run-down areas with this approach, stating that “Khoob-Bakht, more than showing us what we can be achieved in regenerating rundown areas, has demonstrated what cannot be achieved. As such, it is a very valuable experience for the UROT” (Interview 2010). The first director of the UROT, Andalib, highlights that in the absence of urban regeneration experiences, implementation strategies proceeded on a trial-and-error basis at some points. Incorrect identification of problems in run-down areas; the complexity of the problems; the extensive scale of deterioration; the lack of legal, regulatory, and financial frameworks for urban regeneration projects; and the lack of collaboration between different levels of government were all significant issues that the project faced. He further highlights that the lack of flexibility and alternative plans also contributed to the problems (Tavakoli 2011). The head of the UROT investments underscores that one of the important lessons is that the UROT or the municipality should not get directly involved in these types of projects. The policy should be supporting developers in a much smaller scale of one to two hectares, and it should be in the form of free planning permits, loans,

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prepurchasing from the developers, and giving purchase guarantees to them (Interview 2010). The cost of constructing these types of projects is much greater for the government, as the projects take much longer to finish due to the bureaucratic processes and the lack of efficiency that exist within the government. On the other hand, people expect to buy government housing at a much lower price than from the private sector, resulting in losses for government organisations. The experience of government housing projects15 (Khane Sazmani) has not been a successful experience for the government, as these tower blocks have high maintenance costs, with significant capital blocked in these projects. Each unit costs around 200 million tomans (121,212 GBP) to build, and the head of UROT Investments believes that even if they provide 20 million tomans (12,121 GBP) as a loan to each household to rent a place, people would be much more content at one-tenth of the cost to the government (Interview 2010). The director of the KBRP plan believes that one of the important points about Khoob-Bakht is that local knowledge has been created from this experience. Following this experience, it was realised what role each actor should play in regeneration including government, municipality, and residents. The current move towards giving more power to the residents, and the change in the UROT’s role to a facilitator as opposed to a redevelopment organisation, is a result of Khoob-Bakht’s experience. This local knowledge creation relates to the structure and agency discussion highlighted by Healey and Barret (1990) by understanding the role of each agent and how it should relate to the wider structure of the planning framework, which can create a platform for optimal operation of agents. Further to the Webster and Lai’s (2003) discussions regarding modes of planning, the UROT seem to be moving towards the indirect planning mode rather than the direct planning that it utilised in Khoob-Bakht. The director of the KBRP plan further points out: We realised some people are so poor that they are in need of their basic sustenance, and regeneration is not their first priority. Therefore in many projects we moved from physical regeneration to other social aspects of regeneration, including employment creation and developing people capabilities. Also we realised that we could not solve some issues and they need to be solved at a higher level and on a larger scale. (Interview 2010)

He highlights that the new law that was passed in the parliament in 2010 regarding regeneration of run-down areas is a result of Khoob-Bakht’s experience. Further, as other cities usually look up to Tehran as the capital and try to follow its example, the Khoob-Bakht experience is also affecting other cities in Iran (Interview 2010). Finally, as argued by Tomaney (2014), institutions are developed over the long run, and as such the UROT experience in Khoob-Bakht can enhance its performance in future projects. UROT needs to learn from its structural failures as outlined by Naseri and Safari (2018) to cope with the chaos-generating factors, which require structural differentiation in order to overcome these challenges. The caveat is to avoid 15

These schemes can be described as similar schemes to social housing projects in the UK, where government built large housing blocks for residents in what turned out to be not very successful examples. This was done mainly by different organisations for their employees.

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the issues that were highlighted by Katouzian (2004) in his study on “the problems of long-term political and economic development in Iran,” identifying the Iranian society as a short-term society with a short-term memory where lessons learned are not necessarily applied in future circumstances.

References Adair A et al (1999) Evaluation of investor behaviour in urban regeneration. Urban Stud 3(12):2031– 2045 Aminzadeh B, Rezabeigi R (2012) Analysis of participation in urban regeneration projects in order to suggest an appropriate process for redevelopment of deteriorated areas. Fine Arts Acad J 17(3):29–39, in Persian Andalib A (2010) Fundamentals of urban regeneration: a new approach to deteriorated areas. Azarakhsh Publication, Tehran, in Persian Andalib A, Hajialiakbari K (2019) An identification of the neighbourhood renewal process in Tehran: case study—Khoob-Bakht neighbourhood, Tehran, Iran. J Urban Regen Renew 13(1, Autumn):27–43(17) Hajialiakbari K (2020) The rise of the facilitation approach in tackling neighbourhood decline in Tehran. In: Arefian F, Moeini S (eds) Urban heritage along the silk roads: a contemporary reading of urban transformation of historic cities in the Middle East and beyond. Springer, The Urban Book Series, pp 55–75 Healey P, Barret S (1990) Structure and agency in land and property development process: some ideas for research. Urban Stud 27:89–104 Iran Census Organisation, National Census 1375 (1996) & 1385 (2006) Kashef Haghighi M et al (2010) Understanding financing for management of urban regeneration projects in deteriorated areas (case study of Nosazan projects). Online Regeneration Publication, Year 3, vol. 14, Urban Regeneration Organisation of Tehran, Tehran, in Persian Katouzian H (2004) The short-term society: a study in the problems of long-term political and economic development in Iran. Middle Eastern Stud 40(1):1–22 Massoud M et al (2019) Regeneration-led gentrification: a comparative study of Atabak and KhaniAbad neighborhoods in Tehran. Int J Architect Eng Urban Plan 29(2):195–211 Naseri E, Safari B (2018) Structural causes of unsuccessful urban regeneration: the case of renovation of Atabak neighborhood in Tehran, Iran. In: Rajaniemi J, Chudoba M (eds) Re-city. (Im)possible cities. Tampere University of Technology, School of Architecture Rezaii R (2008) Analysis of cultural and social barriers of participatory urban regeneration. Master’s thesis, Social Sciences Faculty, University of Tehran, Iran, in Persian Tarh o Amayesh Consultants (2003) barresi masael tose shahri mantaghe 15 (analysis of district 15 urban development issues). Tehran Tavakoli S (2011) Meeting report: “A new perspective on Khoob Bakht Regeneration project”, Online Regeneration Publication, Year 3, vol. 14, Urban Regeneration Organisation of Tehran, Tehran, in Persian Tehran Master Plan (2006) Municipality of Tehran. Boom Sazegan Consulting Engineers, Tehran Tomaney J (2014) Region and place I: institutions. Prog Hum Geogr 38(1):131–140 Turok I (1992) Property-led urban regeneration: panacea or placebo. Environ Plan A 24:361–379 Webster C, Lai L (2003) Property rights, planning and markets: managing spontaneous cities. Edward Elgar Publishing, Cheltenham, UK http://maps.google.com http://nosazi.tehran.ir Interview with Director of KBRP (2010), interviewed by author, Tehran, Iran Interview with Deputy Director of KBRP (2010), interviewed by author, Tehran, Iran

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Interview with Planning Director of KBRP (2010), interviewed by author, Tehran, Iran Interview with Head of UROT investments (2010), interviewed by author, Tehran, Iran Interview with Director of KBRP Local Office (2010), interviewed by author, Tehran, Iran Interview with Director of KBRP Social Unit (2010), interviewed by author, Tehran, Iran Interviews with Developers A and B (2010), interviewed by the author, Tehran, Iran

Chapter 5

Malek-Ashtar Piecemeal Redevelopment: Description and Analysis

Abstract This chapter describes and analyses the piecemeal redevelopment model in the Malek-Ashtar neighbourhood. A similar structure to the previous chapter is used as much as possible to facilitate comparison between the two cases. However, due to the different natures of the two case studies, maintaining a symmetrical structure was not always possible. The chapter structure is based on the analytical framework diagram from the conclusion of Chap. 2, utilising institutional analysis as a methodological approach to unravel the ways in which property actors see the piecemeal redevelopment process and their subsequent actions. Development decisionmaking is examined within the institutional contexts structured by dynamic needs and the concerns of actors in this case, and the developers’ behaviour is analysed, combining both the economic motivations and social aspects of their decision-making process. The final section provides post completion analysis of the case study 11 years later in 2021. Keywords Malek-Ashtar neighbourhood · Piecemeal redevelopment · Small-scale redevelopment · Spontaneous redevelopment · Bottom-up planning · Small-scale developer behaviour · Self-provision of housing

5.1 Background The Malek-Ashtar neighbourhood is located in the southwest part of Tehran with relative proximity to central Tehran (see Fig. 5.1). Located in District 10 of Tehran’s municipality, the neighbourhood is in a lower middle-class part of the city where also the aforementioned Navab redevelopment project took place on the eastern border of this district. Based on the 2006 national census, the population of this neighbourhood was 11,938 people in an area of approximately 25 hectares. MalekAshtar is a densely populated neighbourhood with a density of 479 people per hectare (pph), while District 10’s density is 396 pph, and that of Tehran is 125 pph. This demonstrates the relatively high density of Malek-Ashtar and a lack of open spaces in this central neighbourhood.

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2022 K. Soltani, Redeveloping Tehran, The Urban Book Series, https://doi.org/10.1007/978-3-030-97091-8_5

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Fig. 5.1 Location of Malek-Ashtar in Tehran (Source Tehran master plan 2006 with permission)

In 1956 (1335) Malek-Ashtar was mainly comprised of gardens and farmlands. It was between 1956 and 1966 (1335–1345) that the new job-seeking immigrants to Tehran began to inhabit the area. Over this ten-year period, almost all the farmlands were transformed into residential uses without following proper development guidelines. Initially, these were large residential lots, but given the financial circumstances of the owners, they started subdividing the land and selling it as they required money or used it to provide housing for their family members. This trend resulted in the current small-lot configuration and the dense urban fabric that exists today (Sharmand 2009). The property boom of the recent years in this district resulted in the reconstruction of major parts of this neighbourhood. The relatively cheap property prices in this area, given its central location and the availability of small lots, created an opportunity for small-scale developers and investors to get on the property ladder. This development trend resulted in a 1.8% average annual increase in the population of this already developed neighbourhood between the years of 1980 and 2006 (1359–1385), with the number of residents growing from 7,123 in 1980 to 11,938 in 2006 (Iran Census Organisation 2006). This sharp rise in the amount of new housing had negative impacts on the neighbourhood, including a lack of open and green spaces, as well as insufficient services and infrastructure. Further, the high density of residential neighbourhoods, together with the inefficient road network, created traffic issues in and around the run-down neighbourhoods of District 10 (https://region10.tehran.ir/, accessed 9, December 2013) (Fig. 5.2).

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Fig. 5.2 New developments in Malek-Ashlar (Source Author 2010)

Fig. 5.3 Land use plan of Malek-Ashtar (Source Sharmand 2009 with permission)

As illustrated in the map in Fig. 5.3, Malek-Ashtar is mainly a residential neighbourhood, comprised of 84% residential land uses on the ground floor and 6.7% commercial, with nearly all residential units above the ground floor. There are 240

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nonresidential units in the neighbourhood: 112 of these units are supermarkets and small corner shops, followed by vehicle service centres with 36 shops. There are 15 construction material stores and 12 real estate agents, indicating the active property and construction markets in the neighbourhood.

5.2 Urban Problems in Malek-Ashtar This section analyses the urban problems in Malek-Ashtar regarding its physical and social aspects, which are interrelated to a great extent. These issues are explored in order to give a better understanding of the redevelopment process that will be discussed in the following sections. Amongst the urban problems, physical deterioration is one of the major problems in many run-down areas of Tehran, and Malek-Ashtar is no exception. The Director of planning of District 10, describes the physical deterioration problem as follows: Most of the building stock was built before the earthquake regulations were in place, and are not earthquake resilient. The neighbourhood is comprised of small lots and narrow roads, to the extent that cars cannot reach some buildings, resulting in reduced construction activity in many places. Infrastructure is in a poor condition, with most utilities being substandard. Public transportation, i.e., bus services, does not serve the area well, and there is a clear absence of green and open spaces, as well as other public or cultural facilities. All these shortcomings, have resulted in this neighbourhood being mainly inhabited by low income residents. (Interview 2010)

These problems range from the scale of one building to the whole neighbourhood and its infrastructure. Individual houses are specifically in poor condition. Developer F, who is a developer as well as a resident, mentions that many of the buildings have humidity and dampness problems. The toilets are usually located outside the house in a corner of the yard, which is mainly problematic for the majority of elderly residents, especially in winter. However, there are some residents that, although their old houses are in good condition, only redevelop their property in order to achieve financial gain (Interview 2010). Based on the physical survey of the municipality’s consultant in 2009 (1388), out of 2,274 buildings in Malek-Ashtar, 14% are between zero and ten years old, 54.7% are between ten and thirty years old, and 31% are more than thirty years old. With regard to building quality, they reported that 20.4% are in good condition, 79.5% are dilapidated, and 69.7% of all the buildings had no structure, whether concrete or steel (Sharmand 2009). The director of the regeneration company of District 10 highlights that the low quality of these buildings expedites deterioration. Further, the poor economic condition of residents does not allow them to maintain their buildings sufficiently (Interview, 2010). The building quality map shown in Fig. 5.4 illustrates the distribution of dilapidated buildings, confirming the extent of deterioration in the area. The lighter areas show newly built buildings illustrate the piecemeal redevelopment that is underway in the neighbourhood (Fig. 5.5).

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Fig. 5.4 Deterioration map of Malek-Ashtar (Source Sharmand 2009 with permission)

The instability of buildings is sometimes to the extent that the buildings can collapse. In the project that Developer C redeveloped on his father’s lot, their old building was about to collapse due to excavation from the adjacent neighbour, who was redeveloping their property. The Municipality advised them to evacuate their house, so they decided to rebuild their property instead (Interview 2010). On the neighbourhood scale, Malek-Ashtar’s urban fabric is comprised of very small lots. Out of 2,274 lots in the neighbourhood, 24% are under 50 square metres, 54% between 50 and 100 square metres, 18% between 100 and 150 square metres, and only 5% are larger than 150 square metres. Further, within this small-lot configuration, the lots have a very high ratio of built-up area, with 18.2% of lots having more than 80% built-up area and 52.1% between 60 and 80%. The buildings are mainly low rise, with 70% having one to two storeys, 19% with three storeys, and 10.8% with four to five storeys (Sharmand 2009). These figures as well as the 3D model in Fig. 5.6 demonstrate the extent of fragmentation and high density in this neighbourhood. With regard to the neighbourhood’s infrastructure, as the neighbourhood was developed in an organic manner from farmlands to a densely built-up area; in the absence of proper development guidelines, many deficiencies were clear during the site visit. Electricity delivery structures are located in the middle of the road, blocking traffic, with wires not safely covered. Gas pipes are not safely covered and are occasionally hit by vehicles on narrow roads, and at places they are located in close proximity to wires, which could be hazardous. Houses are not connected to the city sewage network; they use septic tank systems for their household sewage. There is also a lack of a proper drainage system for surface water, with some household sewage pouring into the alleyways at some places (see Fig. 5.11).

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Fig. 5.5 Dilapidated buildings in Malek-Ashtar (Source Author 2010)

There are numerous social problems in Malek-Ashtar as well. In order to better understand these social issues, the following section outlines the demographic characteristics of this neighbourhood. Based on the 2006 national census, Malek-Ashtar had 11,986 residents, with the average number of people per household at 3.3 people, which is relatively low compared to Iranian standards. The diagram in Fig. 5.7

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Fig. 5.6 3D model of Malek-Ashtar neighbourhood (Source Sharmand 2009 with permission)

Fig. 5.7 Age diagram of Malek-Ashtar (Source Chart created by author from census 2006, Iran Census Organisation)

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illustrates Malek-Ashtar’s population structure, demonstrating a few unorthodox elements. First, the diagram shows a higher proportion of the twenty- to thirtyfive-year-old population, which is attributed to the increase in birth rates following the 1979 revolution due to the Islamic Republic’s population strategy, followed by a sharp decrease during the more recent years. Second, the higher population of men compared to women between the ages of twenty and thirty-five could be attributed to the male migrant workers (mainly single male construction workers) who come to Tehran to seek jobs, and Malek-Ashtar is their point of entry due to its proximity to central Tehran and its affordable property prices. Third, the higher proportion of over-sixty-five-year-olds is due to the over-sixty-five population being categorised in one group rather than the five-year age categories used for preceding age groups. In research on social issues in run-down areas of District 10, Khatibzadeh (2013) highlights that low-income people, with a high number of migrant workers, inhabit the area. She interviewed young male residents of the run-down areas of District 10 between the ages of nineteen and forty-five, as a group that is more likely to cause some of the social issues in these neighbourhoods. She outlined drug addiction, antisocial behaviour, and burglary as the main social problems in the area. She states that many of the young male residents are low-paid migrant workers and have moved to the area due to the low price of housing. She goes on further to argue that the rundown nature of these areas and the low quality of housing have resulted in many of the original residents moving out of the neighbourhood (Khatibzadeh 2013) (Fig. 5.8). Further, in a survey carried out by the municipality’s consultant in 2009, residents were interviewed regarding the main social problems in the area. Three issues came out as their main concerns. Drug-related problems were named as the main social problem, to the extent that the larger neighbourhood, Hashemi, is nicknamed

Fig. 5.8 Residence duration in Malek-Ashtar (Source Iranian Census Organisation 2006)

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Fig. 5.9 Reasons for living in Malek-Ashtar (Chart created by author. Data source Sharmand survey 2009 with permission)

“Hashemi Texas” by many Tehranis, suggesting that is filled with crime like in Western cowboy movies. This is followed by offensive social behaviour, due to the large presence of criminals and thugs in the area, and burglary (Sharmand 2009, pp. 52–57). In the same survey, questions were asked regarding residence duration, reasons for living in the neighbourhood, and sources of discontent with the neighbourhood. The results are illustrated in Figs. 5.9, 5.10, and 5.11. The above charts shed light on interesting elements regarding some social issues within Malek-Ashtar. As can be seen in Fig. 5.5, most residents have lived in the neighbourhood for more than ten years, demonstrating the potential social bonds that might exist within the area. In Fig. 5.6 the main reasons for living in the neighbourhood are cheap housing and proximity to jobs, followed by family reasons, which could be linked to the long residence duration of most residents. In the other set of questions regarding residents’ reasons for discontent with the area, they ranked physical deterioration as the main factor—higher than social problems—underscoring the extent of built-environment-related problems. Although many of the social problems are related to wider societal issues or the poor economic condition of the residents some issues could be attributed to the built environment. For example, the narrow and winding road structure has made it very easy for thugs to hide from the police, decreasing the police surveillance in the area. The construction of a highway to the west of the neighbourhood resulted in many buildings becoming vacant and derelict, turning them into potential crime spots. Public spaces usually allow the underlying social characteristics of an area to come to the surface. In the case of Malek-Ashtar, parks, which are usually considered

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Fig. 5.10 Residents’ reasons for dissatisfaction in Malek-Ashtar (Chart created by author. Data source Sharmand 2009 survey with permission)

an asset in neighbourhoods, have turned into places for social misbehaviour. The Director of the regeneration company of District 10, states that people who live next to parks want to sell their units and move elsewhere. This is where you can see unemployed youth and drug addiction, which is something to which parents do not want their children to be exposed (Interview 2010). The lack of parking space is another problem related to the built environment. This problem is more evident on the main roads, where shop owners do not let residents park their cars in front of their stores. In the absence of relevant regulations, this can result in altercations between shop owners and residents. Therefore, people usually have to park their cars far away, and thieves use this opportunity to break into their cars. This has turned into a major issue for many residents. As far as employment is concerned, based on the 2006 national census, 40% of Malek-Ashtar’s active population is employed, 5% is unemployed, 16% are students, 8% have income without being employed, and 27% are housewives. From the employed population, 26% are office workers, 23% are small-scale businessmen, 15% are unskilled workers, 8% are drivers, and the remaining 28% are in occupations such as repair work, bakeries, etc. (Iran Census Organisation 2006). Although there is a reasonable level of employment, the majority of residents are involved in low-paying jobs. It is also interesting to take into account the similarity that these figures have to those in the Khoob-Bakht neighbourhood, highlighting the similarity of residents that live in these places.

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Fig. 5.11 Narrow road structure in Malek-Ashtar with a power delivery structure in the middle of the road and a lack of a proper surface water drainage system with household wastewater from one of the dwellings pouring into the alleyway (Source Author 2010)

5.3 The Regeneration Process The Malek-Ashtar redevelopments meet the piecemeal redevelopment definition outlined earlier. It is a redevelopment model within which the existing street layout is maintained, while new developments occur within the existing land ownership structure, with some projects redeveloped through the land assembly. The neighbourhood also meets the following criteria that were outlined earlier for selecting a piecemeal redevelopment model:

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Fig. 5.12 Malek-Ashtar development chronology. 2004: Malek-Ashtar before redevelopments started to take place; 2005–2009: gradual increase of density, with more four-storey buildings replacing one-storey buildings (Source Google maps)

• a previously run-down neighbourhood; • the run-down parts of the neighbourhood have been redeveloped, some of them through land assembly; and • some facilitative policies helped trigger these projects. The aerial images in Fig. 5.12 and the map of newly built projects in Fig. 5.13 illustrate the piecemeal redevelopments that have taken place in Malek-Ashtar. Approximately 10% of buildings in Malek-Ashtar were rebuilt between 2001 and 2008 (1380–1387); however, this trend of new developments had its high and low points (Sharmand 2009). As can be seen in the planning permit diagram shown in Fig. 5.14, the number of issued planning permits peaked in 2002 (1381), then it slumped to a low point in 2005 (1384), and then it started to rise again the following year. Although the overall shape of the diagram is similar to the diagram for Tehran (Fig. 5.15), at a closer look each illustrates a different trend. The different development trend in Malek-Ashtar highlights that although there are similarities with the

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Fig. 5.13 Newly built buildings in red, illustrating piecemeal redevelopments in Malek-Ashtar (Source Sharmand 2009 with permission)

Fig. 5.14 Number of planning permits issued between 2001 and 2008 (1380–1387) in MalekAshtar (Source Chart created by author based on data from Urban Regeneration Organisation of Tehran 2012)

wider development trends in Tehran, the local dynamics have a meaningful impact on the development activities in the neighbourhood. These new developments are mainly comprised of three- to four-storey residential apartments. The type of developers that operate in Malek-Ashtar is mainly smallscale developers, many of whom are also residents of the same neighbourhood. They are mainly known to residents, making it easier for residents to enter into a joint

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Fig. 5.15 Number of planning permits in Tehran from 2001 to 2011 (1380–1390) (Source Chart created by author based on data from Urban Regeneration Organisation of Tehran 2012)

venture with them to redevelop their property. Another reason for the involvement of these types of developers in Malek-Ashtar is the scale of investment that fits their budget, as they will not be able to be involved in larger-scale projects due to their limited resources. Some developers do not have any construction-related training and have learned this trade through experience. For example, one of the small-scale developers (Developer E) was previously involved in road work and started to learn about housing construction from other contractors. After a while, he started to act as a small-scale developer himself. As the municipality carries out mandatory steel and concrete structural tests on new buildings, most new buildings are earthquake resilient and built based on standards. The following introduces a few of the developers who were interviewed for this study; these interviews are analysed further in the following sections. • Developer E: He developed three projects in Malek-Ashtar, starting with two projects for his relatives. As he earned a reputation as a developer, he built his third project for a nonrelative client. All of his projects were developed before incentives were put in place, and he paid approximately 11–13 million tomans (6,666–7,878 GBP) for planning permits for each project. However, he obtained a 20-million-toman (12,121 GBP) loan for one of his projects. All these projects were four-storeys, four-unit apartment buildings, and they were completed within seven to nine months of project start (Interview 2010). • Developer C: He developed two projects in the Malek-Ashtar area. The latest project was a four-storey apartment on a 146-square-metre lot owned by his father. Developer C benefited from recent incentives for run-down areas, including a free planning permit at a value of approximately 15 million tomans (9,090 GBP) as

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well as a loan in the amount of 15 million tomans (9,090 GBP) per unit, totalling 60 million tomans for four units, which he believed was instrumental in triggering his project in Malek-Ashtar (Interview 2010). • Developer F: He is a resident of Malek-Ashlar. He has been involved as a developer in Malek-Ashtar for several years and has developed six projects. His latest project under construction is a four-storey building with one unit at each level on a lot that was purchased from its previous owner. His previous project, structured as a fifty-fifty partnership with the landowner, was completed in 2008, and it was a four-storey building with four 62-square-metre units. Both projects took eight to nine months to complete, and bank loans were obtained to maintain cash flow for the projects (Interview 2010). • Developer D: He is one of the more experienced developers who has developed ten projects in Malek-Ashtar. He started developing projects in Malek-Ashtar because three generations of his family have lived in the neighbourhood, and many relatives referred projects to him. Most of his projects were located in the inner and more dense areas of the neighbourhood, with a few projects on the main roads. The projects usually took between eight to twelve months to complete (Interview 2010).

5.4 Implementation of Piecemeal Redevelopment This section discusses implementation of piecemeal redevelopment in Tehran, focusing on the main aspects that emerged in the literature review and field studies, namely, institutional arrangements and actors involved, participation, land assembly, and social issues in implementation. The municipality’s general approach towards implementation in Malek-Ashtar was that there should not be one formula for redevelopment of the whole neighbourhood. The planning director of District 10 states that they believe each block, or even lot, can adopt a different approach. Various types of projects can attempt to solve the problems of a block, which in one place may entail clearing a whole block and defining a project from scratch, while in other places it may be rebuilding the lots where they are located (Interview 2010). The planning director of District 10 believes that, on the one hand, these redevelopments can be viewed in a positive light, as dilapidated buildings are replaced by earthquake-resilient buildings and with new building setbacks roads are widened, resulting in some residents living in improved conditions. On the other hand, when a two-storey building is replaced by a four-storey building, more residents inhabit the area, resulting in increased density without any increase in public services and open spaces (Interview 2010).

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5.4.1 Institutional Arrangements and the Actors Involved With regard to the actors involved in the piecemeal redevelopment process, residents (those who are property owners) seem to be the main actors who can make or break a project. The other major actors include small-scale developers, the municipality, and the regeneration company of the district. The head of the UROT states that since the start of the regeneration programmes for run-down areas ten years ago, less than 10% of these projects have come to fruition. He highlights that the main reason is the inability of municipalities to attract residents to this process as the main actors. As such, municipalities have realised that they need to change their approach, becoming more flexible towards residents’ needs (Interview 2010). The director of the regeneration company of District 10 mentions the significance of property rights of owners, highlighting that they are the only actors capable of triggering redevelopments.1 Developers share a similar view, stating that developments have only started in the area when they managed to form partnerships with owners (Interview 2010). In most cases, residents need to partner with their neighbours and developers in order to implement projects. Given the small lot sizes in the area, a few lots need to be assembled to be feasible for redevelopment. Residents also need to partner with trusted developers to provide financial and technical support for projects. The municipality and regeneration company of District 10, as other actors, are generally supportive towards these projects. As far as institutional and administrative processes are concerned, the main hurdles are the building permit and land assembly processes. The municipality’s long bureaucratic processes discourage many developers, with developers highlighting the exhausting processes of obtaining planning permits and completion permits, land assembly, and title issuance as major hurdles to development (Interview and N 2010). Much effort has been made to facilitate the abovementioned processes in recent years. The director of the regeneration company of District 10 mentions that Tehran regeneration companies, which were established starting 2008, are the first attempts to formalise institutional representation for regeneration at the district level. Their role is to inform residents regarding incentive packages, facilitate redevelopment and land assembly projects by providing administrative and legal assistance, and attract investors and developers to the area (Abdolalizadeh 2010c). While municipality processes are cumbersome for newcomer developers to the district, many local developers have become familiar with their internal process and staff approach over the years and no longer view them as major hurdles. However, they state that the municipality’s process can be arbitrary to some extent due to various staff approaches (Interviews K, L and M 2010). The district mayor mentions that, following the recent introduction of incentive packages for run-down areas, the municipality has attempted to computerise the 1

Also see Abdolalizadeh (2010c).

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permit issuance procedures in order to avoid arbitrary decision-making by staff and unnecessary bartering in the municipality. These steps, he believes, have improved the transparency of the permit issuance system and have encouraged developers to utilise the new incentive package (Abdolalizadeh 2010b).

5.4.2 Participation in Piecemeal Redevelopment Most of Malek-Ashtar’s redevelopment projects are partnerships between owners and developers, similar to the antiparochi system in Greece. Antiparochi is cashless dealing between landowners and developers based on the ownership of units upon completion (Allen et al. 2004, p. 8). The partnerships in Malek-Ashtar are generally fifty-fifty partnerships, where the developer takes 50% of the units and owner the other 50%, providing two to three units to each party. Once the building is completed, the landowner generally moves into one of the units, gives another one to their children, and in most cases rents the third one out. Developers’ units are sold in the market; some purchasers come from within the neighbourhood and others from outside. For example, in the last project that Developer F developed, he mentions, “The landowner moved to one of the units, gave the second one to his daughter, and currently is looking into buying another unit from me for his other daughter” (Interview 2010). He states that people who move to the new developments are either from the surrounding neighbourhoods or from lower-income neighbourhoods; people do not usually move from higher-income neighbourhoods to live here. In terms of the owner-developer partnership, in projects that are situated in premium locations and as the property values increase, the developer’s 50 percent share is reduced. Sometimes landowners ask for an additional deposit (approximately 10 million tomans or 6,060 GBP), and this amount is usually justified as “deposit instead of rent” (rahn)2 for interim housing during the construction period. (Interview 2010)

Developers who operate in Malek-Ashtar are known by the locals and have established trust. These partnerships face many challenges. First, it is difficult for residents to risk their property, as it constitutes most of their belongings. Further, many residents are elderly, with a very low-risk tolerance. Second, trust levels towards developers are low, as many developers in the past have deceived residents by providing false promises and taking loans on titles and running away (Interview 2010). Owners occupy the majority of units in Malek-Ashtar, with approximately 15% of properties occupied by tenants.3 This follows the general homeownership trend in Tehran, where on average 19% of properties have tenants and 81% are owner occupied (Sharmand 2009). Tenants are usually left out of the redevelopment process. Given the religious beliefs of residents, especially amongst the low-income population, mosques and religious gatherings can be used as a platform for advocating 2 3

Rahn is a deposit that is paid to the landowner as opposed to rent. See Chap. 3 for more explanation. This figure usually has some inconsistencies due to tax avoidance.

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participation. In the adjacent neighbourhood of Southern Zanjan, the Regeneration Office attended religious gatherings in the neighbourhood in order to promote regeneration participation. They found that 73% of the religious gathering attendees were residents of run-down buildings. Following their presentation of the regeneration initiative and incentive packages, they found that 17% were not willing to participate in regeneration, 35% attended the Regeneration Office to register and utilise the incentive packages, and 47% experienced various issues in finalising their registration, pertaining to land title, inheritance-related issues and multiple owners, as well as family-related issues (Southern Zanjan Neighbourhood Regeneration Office 2013). The Regeneration Office of Southern Zanjan argues for the effectiveness of these gatherings as a means to obtain residents’ trust for regeneration. Further, these gatherings provide the opportunity to recognise elders and influential residents in the neighbourhood, who can then assist in communicating the regeneration message more effectively. Given the mistrust towards public authorities explained earlier, utilising institutions in which people have trust can act as a platform for encouraging further participation in regeneration, a strategy that was not utilised to its full potential in Malek-Ashtar.

5.4.3 Land Assembly The Municipality of Tehran has been trying to encourage land assembly as a new approach towards the redevelopment of run-down areas. Nevertheless, it proves to be a complicated process for developers. In Malek-Ashtar, approximately 70% of lots are under 100 square metres. There are new regulations regarding staircases and elevators (for four-storey buildings), making redevelopment of lots under 100 square metres unfeasible (Interview 2010). Developers believe that at least two and ideally four lots should be assembled to create a feasible project. The district mayor, Hosseini, mentions that one of the major responsibilities of the regeneration company in District 10 is facilitating land assemblies. They also provide incentives for real estate agents in the area who succeed in facilitating a land assembly project. As such, the number of permits issued for land assembly in District 10 increased significantly during the past year (2009) compared to all other districts. In 2009 (1388), seventy-one permits were issued for land assembly projects in District 10’s run-down areas, comprising 166 lots, which as a result produced 481 residential units. The majority of these land assembly projects were two- to three-lot assemblies, with a few projects consolidating six or even nine lots (Abdolalizadeh 2010c). Nevertheless, land assembly proves to be a complicated process, with many developers seeing it as the main obstacle to redeveloping run-down areas, mainly due to social and bureaucratic issues. With regard to social issues, it is difficult for people with different backgrounds to reach a redevelopment agreement and eventually live

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together. After many years of living in a single-family house, it proves difficult for many residents to live in apartments. Many elderly residents prefer living in a dilapidated independent house to a brand-new apartment with neighbours they do not know (Interview 2010). One of the developers recalls a proposal he made to other developers who were developing three adjacent projects in the same alley: If we would have assembled our projects, we could have realised many efficiencies and cost savings (for example, one elevator instead of three). However, other developers believed that the building will become too crowded, lowering the demand for the final product. Further, they believed having multiple landowners requires dealing with several families with several different tastes. (Interview with Developer C 2010)

There are also many bureaucratic hurdles. One of the active developers in MalekAshtar, Developer D, who carried out three land assembly projects, one of which involved assembling four lots, sees land assembly as a troublesome bureaucratic process that he will not be involved in again. He highlights that many issues are outside the municipality’s scope and believes that in practice the municipality does not provide enough administrative support. For example, obtaining the completion certificate is much more complicated for assembled projects compared to single developments. Getting the final title deeds, which is under the purview of the Land Registry, is very problematic for assembled lots, with no provision for facilitation of land assembly projects in run-down neighbourhoods. He recalls that it has taken him more than a year to get divided deeds. Aiming for a 30% profit for a one-year-long project, given the 20% average annual inflation, this delay has significantly impacted his profit. Further, an extra tax (approximately 4 million tomans or 2,420 GBP) is charged for land assembly (Interview 2010).

5.4.4 Social Issues in Implementation Major transformations in cities have social consequences. These consequences are less significant in piecemeal redevelopments compared to comprehensive redevelopments. This section looks at the movement of people and new residents of Malek-Ashtar, as well as the elderly population’s response towards redevelopment. Malek-Ashtar has not experienced a major change in the configuration of its population. The original owners mainly move back to the redeveloped buildings. Some new residents move to the neighbourhood as a result of the new developments; however, they are mainly from the surrounding neighbourhoods and have similar social and economic backgrounds. For new residents, this is mainly a transformation from being a tenant to an owner. The new buyers usually had rented somewhere else with a deposit of around 20 million tomans (12,121 GBP). Once they have withdrawn that amount and obtained a bank loan for around 20 million tomans (12,121 GBP), then they just need to raise another 10 million tomans (6,060 GBP) in order to buy a 50-square-metre unit in Malek-Ashtar that costs around 50 million tomans (30,303 GBP) (Interview 2010).

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Resistance towards redevelopments mainly comes from the elderly residents, who do not want to see a change in their lifestyle. One of the developers states: Many of the elderly residents do not consider financial gains. If you offer them a nicer apartment in a better part of town, they will not take it. They are used to the system that exists in this neighbourhood. When they leave their house in the morning, they know where is the bakery, grocery store, and who does what in the neighbourhood. For them these routines are important, and if any change happens, their way of living changes. They also have memories attached to this area, of where their kids grew up, and other major milestones in their life. They are fond of their small courtyards, and living with many people in an apartment is seen negatively by them. (Interview 2010)

These issues underscore that new developments should have minimal impact on the structure of the neighbourhood. These developments should also take into account residents’ lifestyles, incorporating courtyards and less crowded apartments wherever possible.

5.5 Property Development in Piecemeal Redevelopment This section starts by discussing property development operations in the piecemeal redevelopment case. Following this introduction, incentive structure, developments that worked well and those that did not, as well as the impact of property markets are explored in further detail (Figs. 5.16 and 5.17). The redevelopment trend can be directly linked to the urban fabric structure, with properties along the main roads seeing most of the redevelopments, while inner areas experience much less activity. This trend can be attributed to two items: first, properties along the main roads have higher prices and are more attractive for redevelopment. Second, better access is a key determinant, as in the narrow alleys of the inner areas truck access is almost impossible for construction material delivery, while in other places trees and electricity posts located in the middle of roads make lots inaccessible by vehicle. Developers confirm that Malek-Ashtar cannot be treated as a homogenous entity, and location within the neighbourhood can be named as the major factor in developers’ decision-making processes about whether to take on a project (Interview and N 2010). The map shown in Fig. 5.18 confirms the abovementioned trend of redevelopment in Malek-Ashtar by illustrating the quality of life in the neighbourhood, based on research that was undertaken in 2012 by Rafeian et al. (2013). The darker colours in the map demonstrate greater satisfaction with living conditions, while the lighter colours show lower satisfaction. Housing quality had the greatest significance on the determination of quality of life in this research method, which included building age, structure, and number of rooms in a building. The developer’s profit is the most significant factor in their decision-making. Given the fluctuating inflation, it proves difficult for many developers to ascertain a specific acceptable profit percentage; further, many developers treat these projects as their job and will proceed even if the profit is lower than expected (Interview 2010).

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Fig. 5.16 New developments in Malek-Ashtar (Source Author 2010)

Time is a critical element of profit calculation. Administrative processes, including land assembly procedures, are common sources of delay in scheduled completion. However, the inflationary nature of Iranian currency misleads many developers with rising property prices, not allowing them to realise the potential loss in developments due to increased project timeline. Malek-Ashtar developers point out that time is much more significant for private developers compared to public sector ones. In public-sector projects, once a building is completed, utilities and titles usually will be ready many months after completion. However, in the private-sector projects, upon construction completion, all the utilities and legal work have to also be ready, as otherwise, they will risk not being able to sell the units (Interview 2010).

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Fig. 5.17 New developments in Malek-Ashtar (Source Author 2010)

Fig. 5.18 Quality of life in the Malek-Ashtar neighbourhood (Source Rafeian et al. 2013 with permission from the author)

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5.5.1 Incentive Structure In order to attract private investors to run-down areas like Malek-Ashtar, the municipality introduced various measures to support developments. The director of planning of District 10 states that this support can be instrumental in District 10, where designated run-down areas comprise 53% of the district (Interview 2010). The main incentives are as follows: • free planning permits • loans of up to 25 million tomans (15,152 GBP) for units that are built utilising modern construction methods and up to 20 million tomans (12,121 GBP) for units that utilise traditional construction methods • borrowing rates are charged at a reduced rate of 12%, significantly lower than the standard 20–25% bank rates (Abdolalizadeh 2010a and 2010d; Incentive Package for Deteriorated Areas 2012). Another new incentive that targets land assembly projects is that if the surrounding lots at the end of a dead-end assemble, then the municipality will allow them to also build on the cul-de-sac free of charge, which is the municipality’s property. There are many of these cul-de-sacs in run-down areas; depending on their area, they can be worth between 20 and 40 million tomans (12,121–24,242 GBP) (Interview 2010). The abovementioned policies have encouraged redevelopments in Malek-Ashtar and have slightly increased property prices in the neighbourhood. More widely in Tehran, the planning permit requests in run-down areas increased by 80% in the first half of 2010 (1389) compared to the same period in the previous year. This trend occurred at a time when Tehran is experiencing a property market recession (Interview and J 2010). The head of the Mass Housing Developers Association of Tehran mentions that developers have started to look into buying land in run-down areas in order to take advantage of these incentives (Interview 2010). The head of Tehran Regeneration Company, who oversees the regeneration companies of different districts, states that projects in run-down areas can now be developed with minimal capital requirements. As land is provided by residents as part of the joint venture, planning permits are free of charge, and with the low-interest loans in place, developers only need to finance part of the construction costs. As such, many developers prefer run-down areas to other development opportunities in more upscale locations (Interview 2010). There have also been calls for a more comprehensive incentive package. One of the established developers in the area believe that simplifying the bureaucratic processes could be the most important incentive. As time is a key factor for any investor, long bureaucratic processes are turning away many developers (Interview 2010). Another major hurdle is the existing master plan of District 10. The master plan, which is a dated document, does not assist the municipality in meeting its redevelopment objectives and does not provide the flexibility required in facilitating new developments (Interview 2010).

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Another shortcoming is that investment packages are only designed for property owners, with tenants being excluded. The director of the regeneration company of District 10 states that this approach has resulted in tenants providing misleading information when municipality staff are looking for owners. He believes that the government should introduce supportive measures for tenants, such as “rent to buy” schemes. These schemes provide loans to developers, which will be transferred to tenants upon project completion, providing a path to homeownership through longterm contracts (Interview 2010).

5.5.2 Developments That Worked in Malek-Ashtar and Problems They Faced Only specific types of developments in terms of scale and design worked in the piecemeal redevelopment of a dense neighbourhood like Malek-Ashtar. Smallerscale developments were favoured in Malek-Ashtar, with four-storey buildings with four units being a standard form of development. These small-scale developments command a higher price per square metre compared to four-storey developments with eight units, highlighting that most residents prefer less-populated buildings. Further, given the importance of the development timeframe on calculating return on investment, the anticipated 30% developer’s profit is much easier to achieve in these projects. With simpler construction work and bureaucratic processes that are easier to manage for small-scale developers, these projects have a dense timeframe (Interview 2010). With regard to design, each developer delivers similar projects. One of the developers mentions that “we usually work with the same architect, who have standard designs that they know municipality will approve. As the lots are either 50, 100, or 120 square metres, they will slightly adjust them to fit the sites” (Interview 2010). As developers were involved in many projects in the neighbourhood, they are familiar with the general taste of the residents and deliver projects on that basis. However, given that there are multiple developers involved, the outcome in the neighbourhood as a whole looks diverse.

5.5.2.1

Major Problems

Property development in run-down neighbourhoods can be more challenging than in other parts of the city. Undertaking construction work in a dilapidated fabric, as well as the risk of developers’ profits in a neighbourhood with a run-down image, seem to be the main concerns. Substandard narrow alleys are the major predicament for construction work. One of the developers states that “it is difficult to move your furniture into a house, let alone constructing a building” (Interview 2010). Partial construction roadblocks cause

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arguments with surrounding neighbours, and the dense urban fabric increases the disturbance of construction work for neighbours: “When you are using a hammer, it’s like someone is hitting inside the neighbours’ house” (Interview 2010). Developers who have worked in the neighbourhood for a few years know how to communicate and deal with the locals, while for newcomers this proves a real challenge. Further, demolition and excavation work has a high risk of damaging the adjoining buildings, many of which are not built to standards. Developers who have worked in these conditions have special equipment and are accustomed to methods of construction that make working in a dense urban fabric possible (Interview 2010). In terms of the risk of property development in run-down areas, due to the small scale of investment, many developers do not categorise it as a risky investment. As the units are small and moderately priced compared to the rest of the city, there will be demand for these types of developments that are very affordable. In the case of higher-end projects, there is a smaller pool of customers who can afford them, and they have a longer absorption period in the market (Interview 2010).

5.5.3 Piecemeal Redevelopment and the Property Market Market mechanisms were the drivers of piecemeal redevelopment, especially before any incentives were in place. The following section looks at property prices in Malek-Ashtar as well as market impact on the neighbourhood and its piecemeal redevelopments. Property prices in Malek-Ashtar were higher than in Khoob-Bakht, but lower than the city average at approximately two-thirds of the average price of property in Tehran (Sharmand 2009, p. 97). In the summer of 2010 when the case study was undertaken, the residential property prices ranged between 0.9 and 1.4 million tomans (545–848 GBP) per square metre depending on the building’s age. For retail properties on the high streets, the prices per square metre ranged between 5 and 7 million tomans (3,030–4,024 GBP). Having a parking space was considered a great privilege in this dense neighbourhood. The annual rent rate was estimated between 4 and 7% of total property value. For example, a 100-square-meter, newly built property that was worth 100 million tomans (60,600 GBP) had an annual rent of around 5 million tomans (3,030 GBP) (author interview with estate agents 2010). Land and apartment prices are approximately the same amount per square metre in Malek-Ashtar. In Tehran, higher-end locations have higher per square metre land prices compared to apartments, while in the lower-end locations apartment prices are higher than land prices (Interview 2010). Construction material prices are relatively similar throughout the city, with the higher-end locations spending a premium on finished material; however, the lion’s share of cost difference is the land price variation between neighbourhoods that creates the abovementioned ratios. Although the property market affects developer behaviour, its impact on run-down areas is less significant than on higher-end areas. Developers have experienced 20– 30% price fluctuation in run-down areas, while in the higher-end areas the fluctuation

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can be up to 50% (Interview 2010). Further, the head of the regeneration company of Tehran believes that, due to the incentives in place, the impact of the current recession has been less significant in run-down areas compared to other parts of the city (Interview 2010). Further, the market recession has given developers higher bargaining power in purchasing construction material (Interview 2010). With regard to sale timeframe, developers in Malek-Ashtar tend to avoid presales and sell upon project completion, unless they face cash-flow problems, and with the new loans they are less likely to face such problems (Interview 2010). The market status also plays a role in the sale timeframe; when the market is going upwards, developers tend to wait until completion, while if they foresee a downturn, they start preselling units (Interview 2010). Although property markets have an effect on triggering developments, the smallscale developers of Malek-Ashtar treat development as their full-time job and tend to proceed with projects even during recessions, being less sensitive to profit margins compared to standard investors. Currently, as the market is in recession, many developers struggle to sell units. One of the developers indicates: “Economic and political stability are essential for investment, and currently neither of them is in place. It seems as if homebuyers are waiting for something to happen. However, the market is not the same throughout the city, and there are places and neighbourhoods that still see demand during recession.” (Interview 2010)

One of the characteristics of piecemeal redevelopment at a neighbourhood scale is that projects have knock-on effects on one another. One of the developers recalls that when he broke ground he was the only project in his alley, but a few months later, two other properties started to redevelop, and upon completion, approximately ten properties around the project had started redevelopment. He believes that when people see their neighbour’s dilapidated property turning into a new building within a year, without any contribution from the owner, they become interested in following suit (Interview 2010).

5.6 Post-Completion Analysis As outlined earlier, the field study of redevelopments in was undertaken from June to October 2010. In the summer of 2021, the neighbourhood was revisited to review any changes since the case study analysis. Further, a few scholars have reviewed the neighbourhood and other similar run-down neighbourhoods in district 10 of Tehran where Malek-Ashtar is located. As such, this section discusses the latest status of the neighbourhood, as well as the analyses published on these run-down areas. Trends that were outlined in this chapter continued in the years that followed the field study in 2010. As illustrated in the following drawing based on the Google maps satellite image from 2021, the majority of the neighbourhood have been redeveloped. Similar to the earlier patterns, lots along the main roads experienced most of the

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145

Fig. 5.19 Malek-Ashtar redeveloped lots drawing in 2021 (Source Drawing created by author, base map from Google Maps 2021)

redevelopments, while the inner areas with poor access are less developed. This continuous trend confirms the voluntary bottom-up model based on market forces together with incentives in redeveloping a neighbourhood. Pourmousavi et al. (2019) in their study of economic regeneration in run-down areas of district 10 highlight that these areas have high redevelopment potential given their central location and proximity to financial centres of the city including the bazaar of Tehran. They state that parts of the district with good access have higher redevelopment potential, while the inner areas with poor access are less likely to be redeveloped. They also point to the willingness of residents towards redevelopment. (Pourmousavi et al. 2019) (Fig. 5.19). Babakhani (2019) in her research analysed satisfaction rates amongst residents of two neighbourhoods in district 10 their homes were recently rebuilt as part of the incentives offered in run-down areas. She found that in these neighbourhoods, satisfaction with residential buildings played a significant role in satisfaction with the neighbourhood. Residents who were living in recently rebuilt apartment buildings had high satisfaction with their neighbourhood. In a similar research Taghvai et al. analysed Malek-Ashtar in 2009–2010 when the neighbourhood was still in a rundown condition. They found that while residents ranked quality of housing as a major determinant of quality of life, the majority of residents perceived having a low quality of life and housing in the neighbourhood (Taghvai et al. 2015). As outlined earlier, the road structure was maintained in the neighbourhood and redevelopments occurred within that structure. The following image illustrates how a tree is maintained in the middle of a narrow road while an adjacent lot is redeveloped. The next image shows a whole redeveloped block surrounding a winding road in the middle of the Malek-Ashtar neighbourhood (Figs. 5.20 and 5.21).

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5 Malek-Ashtar Piecemeal Redevelopment …

Fig. 5.20 New developments in Malek- Ashtar by maintaining the existing fabric (Source Author 2021)

Another reason that the majority of the neighbourhood has been redeveloped could be attributed to the social capital in the neighbourhood. Pourahmad et al. (2019) in their research look at the affects of social capital on participation in redevelopments of run-down areas in district 10. They demonstrate that residents had a high sense of belonging to the neighbourhood with 60% of residents having lived there for

5.6 Post-Completion Analysis

147

Fig. 5.21 Whole redeveloped blocks surrounding a winding road structure (Source Author 2021)

more than 10 years. Despite the run-down nature of these areas, residents had a high satisfaction rate of their neighbourhood. They conclude that satisfaction with neighbourhood, together with neighbour relationships were the two most important elements in residents willingness to participate in redevelopments (Pourahmad et al. 2019).

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5 Malek-Ashtar Piecemeal Redevelopment …

A clear benefit of maintaining the urban structure in this redevelopment model was that neighbourhood liveliness remained unchanged and even thrived with new developments. The following image illustrates shops on the main street and thriving street life in the neighbourhood (Fig. 5.22).

Fig. 5.22 Malek-Ashtar neighbourhood liveliness (Source Author 2021)

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149

Fig. 5.23 Wastewater drainage problems (Source Author 2021)

However, given that there was no overarching plan for redevelopments, most infrastructure problems remained unchanged and many were amplified with new developments. The following image illustrates the state of wastewater drainage due to sub-standard road slopes that have created unsanitary conditions on the high

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5 Malek-Ashtar Piecemeal Redevelopment …

street. The next image shows the lack of parking space in the winding roads of the neighbourhood, where residents use an empty lot for parking. Various authors highlighted these infrastructure problems in the area. Taghvai et al. (2015) state that residents ranked low quality of public services and open spaces as a major shortcoming of the neighbourhood. Others including Vahidifar et al. (2020) state that run-down areas of district 10 and Malek-Ashtar neighbourhood specifically, due to the increase in population in recent years suffer from a lack of infrastructure and services affecting the neighbourhood’s quality of life (Figs. 5.23 and 5.24). Zebardast and Mirzaii (2020) in their research analysed the challenges of urban redevelopment management in district 10 of Tehran. They concluded that from approximately 19 important challenges, conflict of interest between the UROT and district municipality, as well as the lack of financial resources of the UROT were the main challenges in redevelopment management. They also outline the inability of the upstream urban plans to take into account the uniqueness of run-down areas, as well as administrative problems in construction permit issuance as other hurdles for redevelopments in district 10.

Fig. 5.24 Lack of parking space as a major infrastructure problem (Source Author 2021)

5.7 Conclusions

151

5.7 Conclusions In the case of the Khoob-Bakht redevelopment, in order to see whether the regeneration project achieved expected results, the project outcomes were analysed against the objectives that were set at the beginning of the project. In the case of Malek-Ashtar, as it was mainly comprised of spontaneous redevelopments without overarching objectives set at the beginning, project outcomes with regard to the preexisting urban problems are analysed here. As discussed earlier, physical and social problems were the major urban problems in run-down areas. Physical or built-environment problems existed both on the building scale and wider neighbourhood scale. The main achievement of the Malek-Ashtar case was redevelopments on the building scale. This resulted in the provision of housing through joint ventures between residents and small-scale developers. Buildings with sanitary, mould, and dampness issues, and most importantly with earthquake resiliency and structure problems, were replaced with new buildings built with standard building codes. As a result, residents live in better-quality homes, with many realising additional financial gains through their partnership in redevelopment projects. The post case study analysis in 2021 showed that the development trend redeveloped most of the neighbourhood as illustrated in Fig. 5.19. However, on the neighbourhood scale, major urban problems were not addressed. In the absence of an overarching master plan for regeneration, problems such as substandard infrastructure and the narrow road network remained the same. Through setbacks required for new developments, roads were widened at various locations, but without a meaningful impact on the neighbourhood scale. Further, market-driven developments and spontaneous actions can have negative impacts and externalities. Density increases without provisions for services, open space, and infrastructure put more pressure on the already strained public services. The post case study analysis in 2021 demonstrated that these problems were amplified with further densification. Physical issues took priority over social issues in redevelopment. As there was no social program in place, the main social problems, such as drug addiction and unemployment, remained unchanged. A major achievement with regard to social issues was the absence of the redevelopment-related social problems that were experienced in comprehensive redevelopments such as Khoob-Bakht. The redevelopment of Malek-Ashtar resulted in a voluntary process through which residents transformed their housing within a one-year period.

5.7.1 Wider Implications of the Project The piecemeal redevelopment that was analysed in Malek-Ashtar also occurs in other neighbourhoods in Tehran to varying degrees. Taking into account the extent of deterioration in Tehran, the piecemeal redevelopment model seems to be a model that can be replicated on a citywide scale for the following reasons.

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First, as discussed by Webster and Lai (2003), spontaneous and decentralised coordination and indirect planning, as driven by the market, do not require complex institutional arrangements, which are necessary for comprehensive redevelopment models of regeneration. Piecemeal redevelopments occur through the existing channels of administrative arrangements. Second, as highlighted by Allen et al. (2004) discussions on self-provision in housing production, voluntary joint ventures between developers and residents in an incremental manner without creating major social difficulties are easier to be replicated. Third, as the neighbourhood street layout remains unchanged and incremental change takes place within that structure, there is minimal impact on the neighbourhood’s livelihood, and construction work does not disrupt daily life as it does in comprehensive redevelopments. If piecemeal redevelopment were to occur on a citywide scale, more facilitative policies and incentives need to be introduced as highlighted by MacLaran (2003). Further, social policies should complement physical policies, with public facilities including parks, open spaces, and health and educational facilities being part of the redevelopment process. In other words, as discussed by Adams and Tiesdell (2010), there is a need for a welfare planning approach to offset market externalities and market failures. Finally, as highlighted by Colantonio and Dixon (2011) and Carter (2000), residential development profits should be captured for investments in infrastructure upgrades, and the spillover effects need to be realised.

References Abdolalizadeh A (2010a) Earthquake and access to public services, the most important reasons for the need for regeneration. City and Building magazine, special issue on urban regeneration; district 10 the most deteriorated neighbourhood of Tehran, Year 8, Vol. 51 and 52, pp. 4–7, Tehran, in Persian Abdolalizadeh A (2010b) Public participation; the most important strategy in regeneration; an interview with District 10 mayor Abolfazl Hosseini. City and Building magazine, special issue on urban regeneration; district 10 the most deteriorated neighbourhood of Tehran, Year 8, Vol. 51 and 52, pp. 8–11, Tehran, in Persian Abdolalizadeh A (2010c) Triggering redevelopments in district 10; an interview with the director of Regeneration Organisation/Company of District 10, Ali Salmani. City and Building magazine, special issue on urban regeneration; district 10 the most deteriorated neighbourhood of Tehran, Year 8, Vol. 51 and 52, pp. 17–19, Tehran, in Persian Abdolalizadeh A (2010d) Do’s and don’ts in regeneration of deteriorated areas; an expert roundtable. City and Building magazine, special issue on urban regeneration; district 10 the most deteriorated neighbourhood of Tehran, Year 8, Vol. 51 and 52, pp. 20–26, Tehran, in Persian Adams D, Tiesdell S (2010) Planners as market actors: rethinking state-market relations in land and property. Plan Theory Pract 11(2):187–207 Allen J et al (2004) Housing and welfare in Southern Europe. Blackwell publishing, Oxford Babakhani M (2019) The explanation of relation between residential satisfaction and renewal actions in Tehran city (Case Study: Moghadam, Takhti, Hashemi Neighborhoods) Hoviat Shahr, Vol 12, No 36, Winter 2019. pp 61–76, in Persian Carter A (2000) Strategy and partnership in urban regeneration, in urban regeneration: a handbook. In: Roberts P, Sykes H. (ed) Sage, London

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Colantonio A, Dixon T (2011) Social Sustainability and urban regeneration: best practice from European cities. Wiley-Blackwell, Oxford http://maps.google.com https://region10.tehran.ir/ Incentive Package for Deteriorated Areas (2012) Urban regeneration organisation of Tehran website. http://nosazi.tehran.ir. Accessed 9 Dec 2013, in Persian Interview with Planning Director of District 10 of Tehran Municipality (2010) interviewed by author, Tehran, Iran Interview with Director of Regeneration Company of District 10 (2010) interviewed by author, Tehran, Iran Interview with Developer C (2010) interviewed by author, Tehran, Iran Interviews with Developers C, D, E and F (2010) interviewed by author, Tehran, Iran Interview with Head of Mass Housing Developers Association of Iran (2010) interviewed by author, Tehran, Iran Interview with Head of Urban Regeneration Company of Tehran (2010) interviewed by author, Tehran, Iran Iran Census Organisation, National Census 1385 (2006) Khatibzadeh P (2013) Analysis of social problems and what impacts them in deteriorated neighbourhoods (a case study of districts 10, 12 and 13 of Tehran). Online Regeneration Publication, Year 4, Vol. 20, Urban Regeneration Organisation of Tehran, Tehran, in Persian MacLaran A (ed) (2003) Making space: property development and urban planning. Arnold, London Pourahmad A et al (2019) Prioritizing the affects of social capital on participation in redevelopment of run down areas (a case study of Region 3, district 10, Tehran). Urban Struct Usage Stud J 20, Fall:51–73 Pourmousavi S M et al (2019) Economic regeneration of run down areas from a strategic planing perspective (case study of district 10 of Tehran). Islamic City Stud Sci J 10(37), Fall:53–65 Rafeian M et al (2013) Quality of life evaluation in run down urban environments (case study of Hashemi (Malek-Ashtar) neighbourhood in District 10). Online Regeneration Publication, Year 3, Vol. 17, Urban Regeneration Organisation of Tehran, Tehran, in Persian Sharmand Consultants (2009) tarh e manzare shahri malek-ashtar (Malek-Ashtar project). Urban Regeneration Organisation of Tehran, Municipality of Tehran Southern Zanjan Neighbourhood Regeneration Office (2013) Utilising mosques and religious gatherings for advocating public participation in regeneration. Online Regeneration Publication, Year 4, Vol. 19, Urban Regeneration Organisation of Tehran, Tehran, in Persian Taghvaii A et al (2015) An analysis of quality of life based on residents’ perception (a case study of Hashemi neighbourhood in district 10 of Tehran). Geogr Plan Sci J 18(50), Winter:89–105 Urban Regeneration Organization of Tehran (2012) Building Permit Database, Tehran. Vahidifar et al (2020) An analysis of factors impacting livability in run down areas (case study of district 10 of Tehran). Urban Struct Usage Stud J 24, Fall:33–55 Webster C, Lai L (2003) Property rights, planning and markets: Managing spontaneous cities. Edward Elgar Publishing, Cheltenham, UK Zebardast E and Mirzaii M (2020) Economic regeneration of urban worn out and inefficient texture with strategic planning approach (case study: District 10 of Tehran). J Econ City Manage 8(30), Spring:105–127, in Persian

Chapter 6

Piecemeal Versus Comprehensive Redevelopment Models

Abstract Chapters 4 and 5 by outlining the two case studies laid the basis for comparing the two models side by side. With that background, Chap. 5 highlights the points of difference and similarity between the two cases, in the quest to answer the main research question: How do piecemeal and comprehensive redevelopment models operate in the run-down neighbourhoods of Tehran? Specifically, how do they operate in terms of implementation and property development? The different aspects of studying regeneration are used as the overarching framework within which the comparison takes place. The analysis topics were selected based on their significance to regeneration in general, and in the run-down neighbourhoods of Tehran specifically, and in order to answer the research questions, providing a better understanding of how these two models operated in the run-down neighbourhoods of Tehran. Finally, the main findings of this research are spelled out, focusing specifically on the lessons that can be learned from the Khoob-Bakht and Malek-Ashtar case studies. These lessons are then expanded to the wider scale and other similar cities, concluding by discussing the underlying theoretical issues as well as the field of urban regeneration in a more general sense. Keywords State intervention in run-down areas · Institutional analysis of property development · Housing provision in run-down areas · Piecemeal versus comprehensive redevelopment · Urban regeneration in developing countries

© The Author(s), under exclusive license to Springer Nature Switzerland AG 2022 K. Soltani, Redeveloping Tehran, The Urban Book Series, https://doi.org/10.1007/978-3-030-97091-8_6

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6.1 Table of Comparison1

Implementation of regeneration

Khoob-Bakht (KB)

Malek-Ashtar (MA)

General

1. Rigid master plan with a comprehensive proposal for the neighbourhood

1. Almost no master plan with a flexible approach towards developments, as each block could adopt a different approach

2. Increase in density is combined with planned provisions (i.e., open spaces, infrastructure, services, etc.)

2. Increase in density without provision of services

Institutional arrangements and 1. The UROT managed most actors involved of the bureaucratic processes, and due to its administrative power was more effective. Bureaucratic processes were reduced to a minimum for developers

1. Developers had to manage all the cumbersome bureaucratic processes. Bureaucratic processes were the main predicament for developers

Participation

2. Given that a whole neighbourhood was being redeveloped in KB, administrative processes were very complex, with the UROT requiring even more administrative power

2. As developers were developing individual buildings, the administrative processes were not as complex as in KB

3. The UROT was the main actor in KB, with residents having a less significant role

3. Residents were the main actor in MA, whereby without their consent almost no project will proceed, and developers had a secondary role

1. The main objective of the KB project was to have the original residents return and live in the renewed housing

1. Without having a clear plan in place, a similar objective as that in KB was achieved in MA, with original residents returning and living in the renewed housing

2. Participation in regeneration 2. Participation in regeneration was also about communal happened only for individual issues issues (continued)

1

In order to better compare the two cases, please read the table of comparison from left to right, comparing each numbered item between the two projects before moving to the next item. Please also note that in this section due to multiple repetitions case study names are abbreviated.

6.1 Table of Comparison

157

(continued) Implementation of regeneration

Khoob-Bakht (KB)

Malek-Ashtar (MA)

3. Participation in KB was titled voluntary, yet everyone was expected to participate, with no alternative plans for those who did not intend to participate

3. Participation in MA was between residents and developers, which was entirely voluntary

4. Consultation with residents only occurred during implementation

4. Consultation with residents occurred prior to implementation

5. The level of trust towards 5. It was easier for residents to public bodies was low, so it trust the private developers as was hard for residents to trust opposed to public bodies the UROT and the municipality 6. Tenants were excluded from 6. Tenants were excluded from the whole process the whole process

Land assembly

7. Many residents were against the proposals, which resulted in altercations and demonstrations

7. Opposition to new developments was limited to adjacent neighbours and was usually resolved amongst residents

1. In KB, land assembly was the main and only strategy for redevelopment

1. In MA, although land assembly was the preferred policy, it was not the only strategy for redevelopment

2. In KB, land assembly projects were not flexible and were dependent on all the surrounding neighbours participating

2. In MA, land assembly projects were more flexible. As long as two to three surrounding neighbours, in any configuration, decided to participate, the projects could proceed

3. Land assembly also took 3. Land assembly only took place for building roads and place in MA for residential other non-residential land uses. projects Instead of using compulsory purchase, this was implemented through Nosazan projects as a new approach by providing replacement housing for residents (continued)

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(continued) Implementation of regeneration

Social issues in implementation

Khoob-Bakht (KB)

Malek-Ashtar (MA)

4. The UROT assembled the lots in KB, and developers did not face any difficulties in this regard

4. In MA, land assembly happened on a smaller scale; however, due to the limited administrative capabilities of small-scale developers, it usually turned into a long bureaucratic process

5. Residents in KB were not eager to enter into a partnership with their neighbours

5. Residents in MA were also not eager to enter into a partnership with their neighbours

1. KB faced more significant social issues compared to MA, which could be mainly attributed to the larger scale of this project and the way in which it was implemented

1. MA faced less social issues compared to KB, which could be mainly attributed to the smaller scale of this project and the way in which it was implemented

2. There was a more significant 2. There was a less significant resistance towards change in resistance towards change in KB MA 3. Lack of trust towards the municipality and the UROT was a major problem in KB

3. In MA there was more trust towards the private developers in comparison to the public bodies involved in KB

4. Cultural issues associated with moving from an independent way of living in a house to a more communal type in apartments was clearer in KB, as the apartments were more crowded

4. Cultural issues associated with moving from the independent way of living in a house to a more communal type in apartments were fewer in MA, as the apartments were less crowded

5. The interim housing provision policy caused major social problems in KB

5. MA had a similar interim housing solution as KB, but was paid for and managed by the developers and worked smoothly

6. KB had a social unit, which organised a few social initiatives

6. No social initiatives took place in MA as part of the regeneration

7. The KB project did not result in a major gentrification, as similar social groups came to live there after regeneration

7. The MA project did not result in a major gentrification, as similar social groups came to live there after regeneration

6.1 Table of Comparison

159

Property development in regeneration

Khoob-Bakht (KB)

General

1. In KB the UROT, as a public 1. In MA there were body, facilitated developments small-scale local developers and recruited individual medium-size developers, to a certain degree acting as a master developer

Incentive structure

Malek-Ashtar (MA)

2. In KB the developers were seen as outsiders and to some extent as intruders. However, they were more systemised and formed an informal consortium

2. MA has local developers who were more familiar with the neighbourhood culture and managed to communicate better with residents

3. Since there were some public bodies involved in KB who were not concerned with returns on investment, time was not as essential for them, resulting in a prolonged implementation process

3. Since all the private developers were looking for fast returns on their investments, time was essential for them in MA, resulting in expedited projects

4. In many cases, as seen in the KB project, when public-sector agencies develop housing projects in Iran, some utilities get connected a few months after project completion

4. As was the case in MA, when a private-sector developer develops a housing project, it is expected that all the utilities should be connected upon project completion

5. The UROT operations were not always financially viable in KB, requiring them to subsidise many projects. However, the projects proved profitable for the developers involved

5. Most of the housing projects, with a few exceptions, were profitable in MA

1. Incentives in KB were offered based on a rigid master plan, which was not always flexible to accommodate developers’ demands

1. Incentives in MA were offered through policies, providing far more flexibility for developers

2. In KB there were more generous incentives in place, including prepurchasing of units, administrative help, and developers did not have to wait for planning permits

2. The main incentives in MA were facilitative policies and low-interest loans. Developers had to spend around five months to obtain planning permits (continued)

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(continued) Property development in regeneration

Khoob-Bakht (KB)

Malek-Ashtar (MA)

3. Some developers were attracted to KB in the hope of future opportunities with the municipality and UROT

3. In MA developers were not mainly attracted to MA for future opportunities

4. As part of the redevelopments in KB, each resident received one new unit at 1.2 times the size of their original land, resulting in one relatively large unit

4. As part of the redevelopments in MA, each resident received two new units, resulting in two relatively smaller units, which was more attractive for residents

What worked and what did not 1. In KB the final units were work in property developments too large

1. In MA the final units were smaller

2. New buildings had around thirty units, making them too crowded for residents

2. New buildings had five to six units, making them less crowded for residents

3. In terms of design, developers of large projects were not totally familiar with residents’ taste

3. In terms of design, developers were more familiar with the residents’ taste, delivering standard designs on that basis

4. Large and complicated projects in KB took longer to finish and made achieving profits more complicated

4. Smaller projects in MA allowed developers to finish the projects more quickly and achieve their desired profit more easily

5. Changing the road layout required moving the underlying infrastructure (sewage, water, gas, electricity), causing significant delays in redevelopment

5. Redevelopments proceeded more quickly in MA, as the road layout/associated infrastructure were maintained

6. Lengthy regeneration processes discouraged many developers, which can be mainly attributed to the extensive land assemblies and the completely new proposed layout for the neighbourhood, which required realignment of roads and the resultant infrastructure issues

6. MA did not experience the lengthy regeneration processes associated with extensive land assemblies and road realignments

(continued)

6.1 Table of Comparison

161

(continued) Property development in regeneration

Khoob-Bakht (KB)

Malek-Ashtar (MA)

7. Due to the larger scale of investment and the delays outlined above, KB had a higher risk for investment

7. Due to the smaller scale of investments and quicker project timeline, MA had a lower risk for investment. However, no major image change happened here immediately, and therefore profits cannot be too high

8. Changing the run-down image of the neighbourhood through complete redevelopment can result into higher profits for developers. However, since redevelopments did not proceed all at once, the neighbourhood still holds a negative image

8. MA still holds a run-down neighbourhood image, which is considered a negative element for developers and potential buyers

9. Developers faced fewer construction problems in KB, as the narrow roads were demolished and more room was created for construction

9. Developers faced more construction problems in MA, as they had to build in a dense neighbourhood with winding, narrow roads

10. There were more social 10. There were fewer social opposition and confrontation confrontations towards the towards the redevelopments in redevelopments in MA KB Redevelopment and the property market

1. In KB redevelopments proceeded based on a master plan regardless of the market demand

1. Redevelopment in MA proceeded based on market demand; for example, lots by the main roads got redeveloped, while the inner areas remained more or less intact

2. In KB there was no major knock-off effect on projects; nevertheless, completed projects boosted investor confidence

2. In MA projects had a major knock-off effect, with new projects triggering further developments

3. In both neighbourhoods, due to the relatively low property values and higher affordability, the fluctuations in the property prices were less significant than in the higher-end projects of Tehran

3. In both neighbourhoods, due to the relatively low property values and higher affordability, the fluctuations in property prices were less significant than in the higher-end projects of Tehran (continued)

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(continued) Property development in regeneration

Khoob-Bakht (KB)

Malek-Ashtar (MA)

4. Large-scale projects like KB are more significantly impacted by the fluctuations in the city’s property market and recessions, because (1) the scale of investment is larger and (2) there are fewer stakeholders involved, resulting in less diversified risk

4. Smaller-scale projects like MA are much less affected by the fluctuations in the city’s property market and recessions, because (1) the scale of investment is smaller and (2) there are numerous stakeholders, resulting in more diversified risk

5. In KB the redevelopments significantly affected the local property market

5. In MA the local property market affected the projects, and the projects did not have a meaningful impact on the local market (unless many projects are built)

6. In KB due to the problems with the title deeds and other uncertainties, developers presold the units

6. In MA, developers usually sold the units upon completion, unless they faced cash-flow problems

Responding to urban problems Khoob-Bakht (KB) 1. The deterioration problem was addressed in the whole neighbourhood, with dilapidated buildings being replaced by earthquake-resilient buildings

Malek-Ashtar (MA) 1. The deterioration problem was addressed building by building, with dilapidated buildings being replaced by earthquake-resilient buildings

2. KB redevelopment resulted 2. MA maintained the existing in improved utility utility infrastructure and road infrastructure and road network network 3. Regeneration caused some social problems in KB by excluding the residents who did not want to participate in this major urban transformation, resulting in major pushbacks

3. Regeneration caused some social problems in MA by overcrowding the neighbourhood without any improvement to the existing infrastructure, services, and open spaces

4. While there were some social programmes in KB, the main social problem, namely, drug addiction, remained unchanged, and so did the employment issues

4. The main social problem, namely, drug addiction, remained unchanged, and so did the employment issues. There were no social programmes in MA (continued)

6.1 Table of Comparison

163

(continued) Responding to urban problems Khoob-Bakht (KB)

Malek-Ashtar (MA)

5. Implementation of redevelopments caused many social problems, creating major resident opposition in KB

5. A major achievement in MA is that implementation of redevelopments proceeded without major social issues. The residents moved back to their units within a one-year period, with all the transformations proceeding with residents’ consent

6. Some nonresidential uses were developed alongside residential developments in KB, including a park, a sports centre, and a few commercial units

6. MA mainly experienced residential developments without the associated nonresidential developments

As outlined in the above table, the different nature of each project significantly impacted how it operated on the ground. The piecemeal case, with a bottom-up approach to redevelopment, resulted in a step-by-step and moderate change in the neighbourhood, whereas the comprehensive case, with a large-scale top-down approach, created major issues for the residents but proved effective in some other aspects. The implementation strategy was a major dividing factor between the two case studies. The KB project was based on a rigid master plan, with the UROT as the main actor in charge of implementation and residents as secondary players, while the MA project had a flexible nonplan strategy, with residents as the main actors who worked with developers to build the projects. Participation in implementation of the KB project, in addition to housing, included communal issues such as roads and public spaces; however, the implementation process required everyone to participate in order to allow the proposed projects to proceed. On the other hand, in MA, while the participation was completely voluntary, it did not include communal issues and was only for housing redevelopment. With regard to social issues, KB sparked a range of social oppositions and discontent, while one of the major achievements of MA is that redevelopments proceeded without major social problems. The KB project organised a few social programmes for residents, including a day care for children, first aid and earthquake awareness classes, drug addiction treatment classes, and other educational classes for children and women. Although these classes have had minimal impact, they did not manage to have a significant impact on the neighbourhood. As such, attention to the social aspects of regeneration was assessed as weak, even by those who were responsible for implementing them.2 In MA, no social programmes were organised. Another major difference between the two cases was the way in which property developments were carried out. In KB the UROT acted as a master developer, with 2

Please refer to the Khoob-Bakht analysis in Chap. 3 for further detail.

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issues of time and profit not as significant for them, as a public organisation, as they were for private developers in MA, who were mainly small-scale local developers. KB offered a range of incentives for developments but fell behind MA by offering one large unit to residents as part of the redevelopment, whereas in MA the residents received two new units, which proved to be a major motivation for their participation in the regeneration process. The property market had a major impact on the MA case, as all the redevelopments proceeded due to market demand, while in KB the redevelopment trend was based on a proposed master plan. Nevertheless, the projects in KB were more affected by the changes in the citywide market, while in MA the local market was a more dominant factor. With regard to responding to the urban problems in each neighbourhood, each case responded differently. The deterioration problem, as the driving rationale for redevelopment in both cases, was tackled building by building in MA, whereas in KB it was addressed in the whole neighbourhood. Social issues, with the main one being drug addiction, were not solved in either case. Moreover, each case created some additional social problems, which were made more significant in KB by restructuring the whole neighbourhood, while MA created some problems by overcrowding the neighbourhood. The KB project provided other land uses and services as part of the redevelopment, whereas MA was merely a combination of housing redevelopments without any infrastructure or service provisions.

6.2 Main Findings of the Research As highlighted in the literature review chapter, the scarcity of implemented regeneration projects in Iran, together with the resultant lack of theorised literature on the subject, led to utilising literature based mainly on European examples. Being mindful of the context of these cases, this literature was discussed mainly for its analytical and argumentative aspects, within which a quest for finding alternative ways to regenerate run-down urban areas was highlighted. This gap in literature has been a central aim of this research and has been highlighted by numerous authors, including Porter and Shaw (2009), who raised the need for research in alternative ways for “comprehensive redevelopment” through land assembly. More specifically on the property development aspect of regeneration, Adair et al. (1999) stated that little knowledge is available on private-sector investors or their attitudes, behaviours, and strategies, as well as their perception of risk within urban regeneration practice. Guy et al. (2002) argued that little research was done in understanding how property development works within urban regeneration and in analysing the motivation of investors. Similarly, Nappi-Choulet (2006) stated that urban regeneration and real estate investment principles require further attention in urban studies. This research tried to utilise these analytical frameworks and amend them in order to analyse the Iranian context, where little if any research has been undertaken on exploring different aspects of regeneration.

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Each of the development models analysed in this research had its own supporters and critics. Cheshire (2006) is amongst those who believe that piecemeal development is a natural characteristic of cities, arguing that cities have developed as such throughout their history, with occasional major interventions. This highlighted the need for approaches towards refit and reorder in the built environment as opposed to new build. On the other hand, Turok (1992) and Guy et al. (2002) argued that largescale redevelopment for major economic restructuring in cities might be required where piecemeal development is not the answer. These urban regeneration projects, in old industrial sites or areas of dereliction, had a growth-oriented approach and were favoured amongst financial institutions as major financiers of regeneration projects, with spillovers targeted towards disadvantaged groups. These arguments in the literature shaped the research questions that were posed early on in this research. Understanding how the two redevelopment models operated in the run-down neighbourhoods of Tehran has been the main focus, with the lessons learned from each case study constituting the main findings of this research. The direct versus indirect planning dichotomy assisted with the institutionalist framework and served as the overarching comparative structure, weaving in the range of issues that needed to be discussed in order to answer the research question. This range included understanding market behaviour and developers’ attitudes towards redevelopments as well as analysing what works and what does not work in the run-down neighbourhoods of Tehran. In social terms, this research brings to light the social issues that emerge from each redevelopment model. Further, the research demonstrates what these models have achieved in solving the physical deterioration problems and what they have not achieved in addressing the social aspects. It has to be taken into account that there is no one model that applies to every locality, and a policy that might work in one place might not necessarily be an effective policy in other places. In some cases, a mixture of both models can be the answer. Nevertheless, it became clear from this analysis that comprehensive redevelopment is not a suitable model for redeveloping the extensive run-down areas of Tehran. A redevelopment model can only succeed when it works with the people and has the residents on board; otherwise it risks facing extensive opposition. While government incentives proved crucial in both neighbourhoods, it was clear from the case studies that the policies need to be directed at people first and then at developers in order to encourage participation in redevelopment. Nevertheless, the Khoob-Bakht experience has been one of the first implemented examples in exercising local democracy in urban regeneration in Tehran, and as such many lessons can be drawn from this experience. It has demonstrated how regeneration projects can work in Tehran, but more than showing what can be done, it has exemplified what cannot be achieved. Piecemeal redevelopment, which was introduced as a model in this research, is the redevelopment of the city based on market forces and at some point with the assistance of facilitative policies. It became clear from the analysis that the piecemeal redevelopment model is not sufficient on its own, and it needs to be accompanied by guiding plans and principles in order to be more effective. Nevertheless, this model worked well in the Tehran context and proved to be a more democratic model whereby residents and developers were in charge of the implementation process.

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The model that this research advocates can be described as a model in between the two analysed models, where the positive aspects of each one are taken into account, while the negative elements are withdrawn. It proposes a model within which some of the communal objectives of Khoob-Bakht are combined with the incremental nature of Malek-Ashtar, with a guiding master plan that works with the forces of the market in order to accommodate the developers’ and residents’ demands. In a more general sense, I am suggesting a mode of planning that narrows the gap between developers and planners, and a planning mode that works with the market while at the same time is mindful of its shortcomings and potential adverse impacts. This builds on what Webster and Lai (2003) call the type of intervention in which governments help spontaneous actions and order to flourish; for example, in the provision of infrastructure. It succeeds when it protects property rights and private benefits while at the same time delivering broadly accepted constraints on private actions. Further, as Keivani and Werna (2001a, b) and Mukhija (2004) highlight in the developing world context, this mode needs to be cognisant of informal practices and the market inefficiencies in the developing world.

6.2.1 Lessons from the Khoob-Bakht Redevelopment Khoob-Bakht was the first regeneration experience in Tehran that aimed for redeveloping a neighbourhood for its residents. In this light, it has been a valuable experience, and many lessons can be learned from it. As the director of the regeneration plan of Khoob-Bakht pointed out, the project showed more what cannot be done in regeneration as opposed to what can be achieved. Nevertheless, understanding the complexities of these types of projects and how difficult it can be to implement a project on this scale are valuable lessons. The director of the regeneration plan of Khoob-Bakht believes that many lessons have been learned from this project, with some having wider implications. For example, the municipality’s policy on issuing planning permits free of charge started with Khoob-Bakht and has been a positive step in attracting investment towards run-down areas. However, he believes that whether these lessons will be taken into account in other projects is yet to be determined. As Katouzian (2004) argued,3 Iran is a short-term society with a short-term memory, where lessons learned will not necessarily be applied in future projects. It became clear that one of the major problems was that no public consultation took place prior to the start of the project, causing numerous problems. As many UROT executives pointed out, they did not know what percentage of residents was going to participate (Interview 2010), and consultation only happened during the implementation process (Naseri and Safari 2018). All these underscored that consultation with residents needed to start early on in the process, rather than during implementation. 3

For more detail, see Katouzian, H. (2004), ‘The short-term society: a study in the problems of long-term political and economic development in Iran,’ Middle Eastern Studies, 40 (1), 1–22.

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Some of the lessons that are learned are related to the way in which the UROT, as the organisation in charge of implementation, operated. Given the financial difficulties that the UROT faced later on in the project (Hajialiakbari 2020), it was demonstrated that the UROT lacked an entrepreneurial nature that could have made this project financially viable. It seemed that they abandoned the idea of developing catalyst projects as profit-making initiatives, mainly because it would have made their project similar to the Navab project,4 and they did not explore the idea further in order to draw any financial lessons from it. Although the UROT initially envisaged a catalyst project for neighbourhood development, they assumed that the funding from the Bahraini bank would be sufficient for the whole project and did not pursue those plans, only to encounter financial problems later on in the process. The way in which the municipality’s budget was structured also proved problematic, as there was no consolidated budget for regeneration. Further, the UROT did not use the potential of selling extra units achieved through increased density in the neighbourhood so that it could finance the shortfall in the project and develop non-residential land uses. The planning phase of the project did not identify the organisations responsible for building nonresidential land uses, such as commercial units, healthcare centres, schools, theatres, and other public buildings. And these organisations were not cooperating with the UROT in order to build these land uses. It was surprising to see that an organisation, even one as powerful as the UROT, failed to effectively manage the complex administrative and legal requirements of these projects, highlighting the need for the UROT to be even more integrated with other organisations, such as the land registry, police, school authorities, etc. Some interviewees pointed out the need for an organisation even as powerful as a small government, if a project on this scale were to succeed. However, the practicality of creating such organisation is debatable, as discussed in comparison to the UDC experience in the following sections. With regard to the proposed regeneration master plan, one of the clear shortcomings was that with the increased density there were no plans to increase the resident population so that a more socially mixed neighbourhood could be created. Further, there was a clear lack of nonresidential land uses in the proposed redevelopments. Given that land uses such as shops, parks, and so on bring liveliness to neighbourhoods, they should have been a central element of the regeneration project as opposed to an afterthought. Major infrastructure was another key element that should have been in place before the redevelopment started, but it was also treated as an afterthought once the residential developments were completed. With regard to the implementation process, there are a few lessons that can be drawn from this experience. The most time-consuming of the regeneration processes proved to be the land assembly process. The Khoob-Bakht project demonstrated that in a large-scale project, land assembly can turn into a lengthy task and needs to be limited where possible. Another aspect that delayed the implementation timeline was restructuring the road layout. This approach not only created legal issues but also caused infrastructure problems. Given that most infrastructure was underneath the 4

See Chap. 3 for further detail.

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main roads, restructuring the road layout required the underlying infrastructure to be moved as well. These implementation characteristics resulted in just over a quarter of the neighbourhood being redeveloped by 2021. Interim housing for residents was another major issue in redevelopment projects. As highlighted by the head of the developer’s association of Iran, a solution to this can be building reserve housing in the vicinity of the neighbourhood at the start of the projects, which can increase residents’ participation as they see reserve housing ready to move in. With regard to developers’ behaviour in regeneration, this research demonstrated how these actors perceive regeneration, as for many of them this was their first regeneration experience. Similar to what Nappi-Choulet (2006) suggested in her research that regeneration projects could stimulate countercyclical investment in the property cycles, Khoob-Bakht demonstrated how a recession could attract developers towards regeneration projects, in the absence of other opportunities elsewhere in the city. It also showed what impacts large-scale projects can have on the local property and rent markets. With regard to the social aspect, the projects showed how confrontation with the residents can be a more serious disruption to construction than the deterioration problems. It also became clear how crowded buildings can cause numerous problems for residents and what social issues need to be considered. The range of issues that moving from a house to apartments can cause was also not known prior to implementation. On a positive note, Khoob-Bakht demonstrated how redevelopments can improve the living conditions of those residents who came back to the redeveloped housing, but it can only solve social issues such as drug addiction and unemployment if property-led regeneration is accompanied by major social programmes.

6.2.2 Lessons from the Malek-Ashtar Redevelopment If lessons are to be learned from the Malek-Ashtar case, it is important to take into account Allen et al.’s (2004) analysis of housing provision in southern Europe, as they argue that a perspective change is required in order to learn from these types of cases. First, there needs to be a move from state-centred actions for housing provision towards a broader perspective that looks at mobilising different actors within different social contexts. Second, the aim of housing provision should be changed from providing a commodity for households to providing households with resources that can be used to improve their quality of living and empower them. One of the major lessons that can be learned from the Malek-Ashtar redevelopment is the way in which piecemeal redevelopments have incrementally redeveloped a neighbourhood over the years without major social consequences, while a lower outcome was achieved in Khoob-Bakht with a different method and caused major social issues. Further, the Malek-Ashtar redevelopment demonstrated that financial incentives for residents can be the most effective kind of incentives, encouraging resident participation in the redevelopment process.

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Some other lessons are related to the nature of redevelopment in the piecemeal case, confirming what Guy et al. (2002) and Nappi-Choulet (2006) suggested, that independent developers introduce new pathways to urban regeneration and that having inner knowledge about the local market as well as a good relationship with the local authorities help them in delivering projects. The Malek-Ashtar case confirmed how local developers can work better with residents in implementing redevelopment compared to the comprehensive alternative. It also showed that some processes, like interim housing, are carried out more smoothly when local developers are in charge. A shorter timeline of redevelopment (less than one year in most cases) resulted in faster return on investment as well as a shorter interim housing period, encouraging many residents to participate. Further, the smaller scale of the redevelopment projects, with four to five units in each building, was also better received by the residents than the more crowded alternatives in Khoob-Bakht. There were aspects of the redevelopment in Malek-Ashtar that did not work well; nevertheless, lessons can be drawn from them as well. Land assembly, for example, turned into a complicated bureaucratic process for small-scale developers, who did not have the administrative capacity to deal with it. This highlights the need for these processes to be simplified, should the piecemeal redevelopment be implemented on a large scale. It also became clear that in problematic neighbourhoods, urban spaces can turn into locations for crime as opposed to an asset for the neighbourhood. The example of the park in Malek-Ashtar that turned into a hub for drug addicts confirms this. Other major problems in Malek-Ashtar, like the narrow road structure, lack of open spaces, and poor infrastructure, can slowly be improved over the years by implementation of small projects. However, if piecemeal redevelopment were to be more effective it would require a guiding regeneration master plan that accompanies the incremental redevelopments by addressing the existing urban problems. This plan needs to guide the step-by-step change in the neighbourhood by working with the market and taking into account the profitability requirements of the private investors. Where the private-sector profitability criteria cannot be met, projects that require public investment need to be highlighted. Evans et al. (2009), in their article titled “Organic Regeneration and Sustainability, or Can the Credit Crunch Save our Cities?” argued that recessions have proved that a more organic model of urban regeneration based on bottom-up approaches should replace the private-sector-led commodity-based model, which, for them, has frequently failed to deliver social sustainability. The Malek-Ashtar redevelopment is an example of these bottom-up organic models of urban regeneration; however, the redevelopments proceeded based on market demand. The Malek-Ashtar case has demonstrated how it can be easier to redevelop a neighbourhood when redevelopments are based on the market, good relationships exist between developers and residents, and projects are incentivised by policies that encourage redevelopment, as opposed to direct intervention by public bodies.

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6.3 Implications for Tehran and Other Similar Cities The lessons that are learned from the Khoob-Bakht and Malek-Ashtar cases can have implications for Tehran and other similar cities; however, the way in which these lessons can be applied to other places depends on a variety of factors. As Colantonio and Dixon (2011) demonstrated in their analysis of urban regeneration policies amongst European cities, urban policies and projects are “experimental,” since the new policies are not grounded enough to make a full assessment possible, “local,” since different localities have their distinctions, and “fragmented and contested” due to the variety of stakeholders that are involved in regeneration. At another level, they are influenced by different urban cycles including “political cycles,” “macroeconomic cycles,” and “social and environmental cycles.” All these highlight that urban regeneration policies cannot be easily replicated in other places; nevertheless, if they were to be replicated, the above-outlined factors should be taken into consideration. Tehran, on a citywide scale, suffers from deterioration in vast areas of the city, with the municipality eagerly seeking solutions to tackle this issue; hence, the reason this research was started in the first place. While this research cannot prescribe a simple solution to this problem, what the research has found is the way in which the two models for redeveloping run-down neighbourhoods operate in Tehran and the consequences of redevelopment should such policies be implemented. What became clear is that given the large scale of deterioration in Tehran, if a widespread policy were to be implemented, it needs to be a policy that can be applicable to various locations. The complexities of comprehensive redevelopment make it almost impractical as a widespread model, as it would only make sense in specific projects but not on a citywide scale. One of the reasons why comprehensive redevelopment cannot solve the deterioration problem on a citywide scale is that, based on the analysis, it became clear that the UROT, even with its extensive power, was unable to proceed in all aspects of regeneration. Many interviewees highlighted that if similar projects are to be implemented in the future, the UROT needs to have even more authority and operate like a small government. This proposition resembles the urban development corporation (UDC experience in the UK that was discussed in the literature review. As such, it seems useful to point out how the experience of having powerful organisations like UDC played out in other places to see whether it can be a plausible option in the less-law-abiding conditions of Tehran. As demonstrated in the Khoob-Bakht case, the UROT, even with its existing powers, was seen by many other organisations as infringing on their territory. A similar interinstitutional relationship problem with other organisations was experienced by the UDCs in the UK. The formation of the UDCs was seen as a major intervention in duties of local authorities in the UK. Deas et al. (2000), when analysing three UDCs in Manchester, Leeds, and Bristol, named various reasons for the animosity towards UDCs. For example, the choice of location for these UDCs, sponsored by the UK Conservative government, were mainly the Labour-dominated cities. The UDCs were especially not received well by the local authorities, as they

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were seen as unelected businesspeople without local accountability yet with extensive planning and development powers. Further, their property-led approach was against the local authorities’ approach to regeneration. However, those UDCs that managed to have a good relationship with local authorities, such as Manchester Development Corporation (MDC), better succeeded in their objectives. A major step that MDC took was contracting out the statutory development controls to the city council. Deas et al. (2000) concluded in this regard that “the creation and maintenance of good local networking is a prerequisite for effective regeneration.” They also suggested more transparency of the conduct of their business and revising the membership of the board of UDCs by including local representatives. Nevertheless, the complexities of operating UDCs even in the UK’s institutional context, with clearer regulatory frameworks than Iran, make it unlikely that an organisation with similar powers will be established again. As outlined in the Khoob-Bakht case, the UROT, with its current authority, had major issues with local authorities, and one can only speculate the extent of problems that could emerge should the UROT become a more powerful organisation. As far as the piecemeal model is concerned, although it has many deficiencies, the way it operates allows it to be replicated in different areas. If the piecemeal model is accompanied by a guiding plan taking into account provision of public goods, or in other words, if a plan is implemented in a piecemeal manner in relation to the market, developers’ behaviour, and without significantly intervening in the livelihood of neighbourhood, it can succeed on a citywide scale. What can be learned from the cases in Tehran is that a system of small-scale redevelopments can be more effective. This model in Tehran is more effective with the help of self-provision of housing as well as familial support in providing housing for their members (see Allen et al. 2004 for more detail). In countries with weakly developed public institutions, giving more responsibilities to the private sector can prove more effective and result in more projects being implemented. At the same time, one has to bear in mind, as Turok (1992) argued, the significance of property development in urban regeneration should not be overstated. It should rather create a platform in coordination with other policies for a holistic regeneration strategy. The deterioration problem is not unique to Tehran. Other cities, especially in developing countries, face similar dilemmas. As such, this analysis can help these cities in choosing the right policy in regenerating run-down areas, specifically Middle Eastern cities, as they share similar neighbourhood and social structures as well as economic and financial practices. Each city has a unique institutional framework, bureaucratic processes, and set of actors. Nevertheless, there can be many overlaps with the case studies of this research as well; for example, land assembly is an urban intervention policy that is widely used, property markets can have similar performance, and development industries are more similar in the Middle Eastern context. As such, taking the unique characteristics of each city into account, some of the recommendations of this research can prove useful in other cases, and the analysis of redevelopment policies in this research can help other similar cities in tackling their own deterioration problems.

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6.4 Theoretical Discussions This section outlines the theoretical discussions stemming from this research, highlighting the contribution of this research in relation to the main theories that have shaped its theoretical framework. The theoretical discussions and contributions are discussed in three sections, starting with discussions on ideal types of state intervention, followed by institutional analysis of property development, and finally housing production in run-down areas of developing countries.

6.4.1 Theme 1: Ideal Types of State Intervention With regard to ideal types of state intervention, it is important to remember that this research started by trying to shed light on the dichotomy of state versus market early on in the research. In the end, it is becoming more apparent that the arguments are less polarised, with subtler differences. It seems more appropriate to look at direct versus indirect planning, or the role of state agents versus non-state agents. For example, the Carmona (2009) diagram that was mentioned at the beginning of the research analysed the redevelopment processes that London Docklands went through. This diagram categorises planning modes based on two related axes: on the one hand, it ranges from plan-based to opportunity-based, and on the other hand, from state-led to market-led modes of planning. This model creates four quadrants, within which Khoob-Bakht can be placed in the state-led/plan-based quadrant and Malek-Ashtar in the market-led/opportunity-based quadrant (Fig. 6.1). Nevertheless, as demonstrated in this research, the planning mode that works best can be placed somewhere in between these quadrants. An important aspect to bear Fig. 6.1 Modes of planning (Adapted from Carmona 2009; Copyright Elsevier 2009)

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in mind is that the state-led policies are usually long term, while the private-sector interests are short term; therefore, effective policy needs to deal with this gap by trying to narrow it down as much as possible. The analysis in this research demonstrated that the piecemeal redevelopment model is a model that can be replicated in different places with different contexts. This highlights the need to work with the market, while due to the market externalities it is important to achieve the right mix of state intervention and market-driven redevelopments. Further to Carmona’s (2009) discussion on modes of planning, as well as Webster and Lai’s (2003) arguments on centralised versus spontaneous planning, this research elaborated on discussions for balanced or less state involvement in urban development projects. This call for less state involvement to some extent was driven by the general distrust towards public authorities as demonstrated in both case studies. This type of state intervention builds on Parnell and Robinson’s (2012) argument in the context of the global South and developing countries, whereby offering their post-neoliberal critique they highlight that calls for more community involvement and less state intervention are not always derived from neoliberal theories but are rather a product of distrust towards the state. Nevertheless, this does not imply advocating a laissez-faire approach, as the shortcomings of such an approach were clear through the lack of infrastructure improvements and community amenity provision in Malek-Ashtar. Mukhija (2004), in analysing the market-enabling strategies in the case of Ahmedabad, India, warns against a very hands-off approach by the government, highlighting the need for engaged government involvement in framing successful policies. In other research in 2001, he highlights similar paradoxes between regulation and deregulation, as well as privatisation and public investment, by analysing the slum redevelopment programmes in Mumbai, India. As outlined in this research and underscored by Mukhija (2001), market-enabling strategies require a balanced state involvement where the state’s role is to provide institutional support for property development. Further, as Mukhija (2004) argued, in many instances public policy and marketenabling strategies can have adverse impacts on the ground, and as such this research tried to demonstrate with empirical evidence the impact of public policies and marketenabling strategies on the ground. This understanding of policy impacts on the ground benefited from the fact that the projects that were analysed here were in the implementation stage, providing valuable information on how they are being implemented, which would not have been possible if the projects were completed. This approach has also been used by others like Kuyucu and Unsal (2010), where they analysed urban transformation projects during implementation in Istanbul.

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6.4.2 Theme 2: Institutional Analysis of Property Development With regard to institutional analysis of property development, as demonstrated in this research, in addition to the different modes of planning, the different roles that actors play in each model is also of critical importance. For example, as developers were more trusted in the Malek-Ashtar case, the implementation process proceeded more smoothly. Further, the role that self-provision plays in property development in Tehran plays a significant role in the redevelopment process. As such, this research utilised an institutional perspective to further the understanding of development processes. This research followed Adams and Tiesdell’s (2010) call for further research on institutional analysis of state-market relations in property development, highlighting that since Healey’s work in the early 1990s, where she analysed the interaction between planning regulation and market conditions, followed by Pennington’s (2000) and Webster and Lai’s (2003) work on institutional economics, there has been little interest in state-market relations in land and property. Both Adams and Tiesdell’s (2010) and Adams et al.’s (2012) papers call for a more thorough understanding of the behaviour of implementation agents, specifically developers and landowners, as well as the cultural differences between different types of developers, in order to assist planners in more effective policy-making, which has been the focus of this research. As such, further to the work of Healey and Barret (1990), this research built on their institutional perspective to further our understanding of redevelopment processes. In doing so, this research has helped to improve our understanding of the interests and strategies of agents within two different development processes; the rules and resources utilised by agents; as well as the dynamics of the wider economic, political, and cultural structures that these practices both constitute and reflect. This research analysed the above dynamics through two completely different types of state intervention in order to provide a range of outcomes. In terms of policy implications, this research provided a framework for assessing the consequences of urban redevelopment interventions. As Healey and Barret (1990) argue, this type of research improves our understanding of the process of built environment production and the role of the state in the development process, which was discussed at length under the previous theme. Further, by building on the work of other institutionalist scholars like Guy and Henneberry (2000), this research has demonstrated that development decisionmaking cannot be solely understood as the result of economic rationality, as it occurs within institutional contexts structured by the dynamic needs and concerns of actors. This research demonstrated that by unpacking the developers’ behaviour, a better understanding of social and economic issues in the development process could be achieved. In advancing institutional analysis, this research, by focusing on

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two specific projects, demonstrated the different approaches taken by property developers, development organisations, and planners as they engaged differently with the wider structures set by the government through different policies.

6.4.3 Theme 3: Housing Production in Run-Down Areas of Developing Countries With respect to the context within which the case studies were undertaken, further to Parnell and Robinson (2012), this research attempts to make a theoretical contribution based on practice-based understanding of urban processes from the cities of the global South, where the majority of the world’s urban population resides. With respect to the theories from the global South, Parnell and Robinson (2012) highlight that Southern urban issues, for example, the “urban informality” that piecemeal redevelopment to some extent represents, have become prominent in recent literature. With respect to affordable housing production in developing countries, others like Mukhija (2004) highlight the overlap between formality and informality in urban practices, arguing that public policy needs to take into account the contradictions between formal and informal markets and that planning frameworks need to be more flexible in order to accommodate informal practices. Further, public policy should avoid naive optimism and assume opportunistic behaviour by all actors, including developers, homebuyers, and public agencies. This research demonstrated the opportunistic behaviour that occurred in both cases, while showing that the more flexible framework of the piecemeal case provided the opportunity for formal and informal practices to coexist. Due to underdevelopment of institutions and markets as well as social, economic, and political conditions, public provision of housing and direct government provision schemes in developing countries have failed in many cases as demonstrated by Keivani and Werna (2001a) as well as in this research. Further, Keivani and Werna (2001a) argued that large-scale firms are not able to use their main advantages, for example, economies of scale, in underdeveloped economies, as the underlying requirements for such operations do not exist, and where it does exist it proves too costly. They highlight that the fact that the majority of housing in developing countries is provided by small-scale developers through formal and informal modes of provision; as discussed in Chap. 3, this proves their operational efficiency compared to the large-scale firms. In this research, through the two types of redevelopment projects that were analysed in the context of the extensive deterioration problem of Tehran and the developing world, it was demonstrated that if redevelopment of run-down areas is to be achieved at a citywide scale, direct government intervention does not seem to be the solution. Therefore, a more incremental approach, whereby households are involved in the development process, like the joint venture schemes in the piecemeal case between the small-scale developers and landowners, can prove more effective.

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Finally, with regard to the problems with housing the growing population and affordability issues, as wider structural pressures on the cities of developing world, the incremental redevelopment of run-down areas can contribute to a housing/affordability solution. The maps produced by Bertaud (2003) illustrated that the population is leaving the run-down areas of Tehran, while on the other hand, rapid population growth significantly affects housing demand. The experience of urban land supply policies, mainly in the peripheries of cities in Iran, although they had some positive impacts with regard to stabilising land prices and providing housing at a large scale, had major infrastructure provision issues. Major cities, like Tehran, due to a shortage in vacant land, did not benefit from them (see Azizi 1998, p. 103). In the context of land shortages in major Iranian cities, as demonstrated in this research, urban regeneration through redeveloping the inner-city areas can contribute towards the much needed housing shortfall, and based on their inner-city locations do not face the infrastructure provision problems of outer-city locations. Further, with respect to the wider structures of economy in Iran, as discussed in Chap. 3, the World Bank report (2004) highlighted the need for increased supply of housing for the low-income population in Iran. Further, the government and mass housing developers have failed to address the major housing affordability issue that exists. As highlighted in the World Bank (2004) report, 60% of the new housing supply can only be afforded by the top 20% of the income groups, while the bottom 40% of the income groups can only afford 8% of the new housing supply. The urban regeneration projects in run-down areas target these excluded groups, providing new housing for lower-income groups and contributing to this wider housing affordability issue that exist in the country.

6.5 The Field of Urban Regeneration The urban planning field in general is suffering from a lack of understanding of the development sector. This understanding is critical, as the public policies that planners devise need to be implemented through the private land and property markets as well as the profit-seeking mechanisms of the private sector. Further, another key issue that planning needs to deal with is narrowing the gap between the long-term goals of the public sector and the short-term goals of the private sector. As such, it is critical to understand the private sector’s (developers’) behaviour, which has been one of the main objectives of this research. This lack of understanding between the two professions seems more surprising when one realises the degree to which they are interconnected, requiring close cooperation in order to materialise urban development projects. As such, planning needs to refine its position, walking the fine line between securing social justice and internalising the external factors of developments, while at the same time preparing platforms for profitable outcomes for the development sector.

6.5 The Field of Urban Regeneration

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Urban regeneration is one of the well-known options to accommodate urban growth through urban containment. Accommodating rapid urban growth is especially needed in developing countries. Further, regeneration is seen as an opportunity for redeveloping run-down areas from the public sector’s perspective and for profit making from the private sector’s perspective. This research attempted to see how these contrasting aspects interact in upgrading run-down areas. Within urban regeneration, one of the most challenging aspects is regenerating neighbourhoods that house an existing population. Hence, these types of projects were selected for this research to expose the types of challenges that regeneration might face. Further, in pursuit of finding different ways to regenerate run-down areas, two models were selected, representing direct and indirect planning, highlighting the need for finding alternative ways for redevelopment. One of the major drawbacks in implementing regeneration projects is the long process of implementation, which disrupts residents’ lives and, for the developers in charge of implementation, impacts their return on investment. On the other hand, public consultation and bringing everyone on board is a time-consuming process. As such, the decision-making bodies need to reach compromises between these issues that can be at odds with one another. Technological advances in the construction industry that decrease the construction timeframe can help expedite the overall regeneration process in the coming years. As discussed earlier, this research advocates that the way forward for planning is flexible urban plans that work with the market, with a mode of planning that is in between the two analysed models. It advocates a regeneration process that has the residents as the main actor while at the same time guiding the neighbourhood with an overarching plan without being too restrictive, taking into account provisions for open spaces, commercial elements, and services for the neighbourhood, and (in the case of Tehran) improving the road structure. As outlined in the case studies of this research, building projects can succeed in solving built environment issues and some related quality-of-life issues. But in contrast to what many regeneration officials believe, they cannot solve the social issues. There need to be more social initiatives alongside these development plans, as well as economic policies to tackle issues like unemployment. Many of the problems have deep roots in citywide and at times national policies. Although some issues could be solved locally, there are others that need higher-level policies. Many urban problems are universal, and similar issues with redevelopment exist in different cities. However, since each case is completely unique, and what works in one place will not necessarily work in other places, this research is not trying to suggest a type of redevelopment that works everywhere. Rather, this research has tried to create a platform for analysing different types of development, pointing out the main issues to look for when considering a redevelopment model.

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