INFORMAL SETTLEMENTS

I recently moderated a productive online workshop on Informal Settlements.? Bill Kistler and his urbanOvation platform hosted the discussion; we organized the event on behalf of EYDK, the Turkey-based arm of the GSG Impact .

STRATEGY

There are over 1.5 million units of informal construction a year in Turkey, but no national strategy.? Onur I. , Secretary General at Etki Yat?r?m? Dan??ma Kurulu "EYDK" - Impact Investing Advisory Board , is producing a local report and a pilot project for Turkey within the larger framework of GSG’s Informal Settlements agenda. This effort will include an impact management ‘toolkit’ addressing the phenomenon. In particular, EYDK is defining potential capabilities for the private sector, including introductions of impact bonds, to address the inconsistencies between community building and the financial motives of independent developers who often attempt to legalize informal houses in order to demolish them and immediately build high-density commodity residential buildings.

Onur and the EYDK team believe that conventional top-down masterplanning often disregards grass-roots innovation and adaptation and creates unintended consequences. They are exploring bottom-up approaches that allow for more incremental planning, flexible land uses, and extensive citizen participation.?

URBAN TRANSFORMATIONS

Gecekondu are the large-scale informal settlements particular to Turkey. They share characteristics with similar liminal zones in other countries - for example the ‘Urban Villages’ in China, ‘Land Invasions’ in South Africa, and ‘Unplanned Settlements’ in Saudi Arabia). ?This kind of urbanization is part of a broader 20th century economic, social, and political phenomenon of growth along the periphery of almost all global cities. There are many drivers of urban informality, including the industrialization of agriculture, growing economic inequalities between rural and urban populations, lack of social housing programs, as well as dysfunctional urban planning and governance. Informal settlements often exploit legal loopholes that reward incoming inhabitants with contestable property rights, but also lead to overcrowding, lack of services, and pollution.?On the other hand, these developments can also become examples of self organizing societies, with their own hierarchies and ground-up approach to delivering services; they suggest strategies for generative urban design that might also be applied to regulated formal systems.

We thought it would be interesting to invite some other voices to address the issue, to allow us to gain insights that might be applied to circumstances beyond Turkey.?Specifically, we wanted to learn about some innovative examples of urban transformation, how the private sector might be motivated to address informal settlements, and how best to build sustained stakeholder engagement.

CONNECTING TO THE CITY

Sebastián Welisiejko , economist and the former Secretary of State for Socio-Urban Integration in Argentina’s Cabinet Office, noted the importance of having policy tied to specifics of territory. Informal habitats are manifestations of inequality. In Buenos Aires, almost 40% of urban expansion is informal settlement, and create socio-economic tensions. Public budgets alone are not enough to bring about positive change. A critical initial strategy is to be ‘pro poor’ and integrate informal settlements into rest of city. In a case like the Gaza Strip, beyond demands for civic rights, two million inhabitants need an underlying development strategy that can create reciprocal benefits for both Palestinians and Israelis. (NOTE: I led the Connected Gaza strategy with Sebastian and The Portland Trust.)

Bridget Ssamula , CEO of Engineering Council South Africa and a former 艾奕康 colleague, highlighted the powerful tool of infrastructure and transportation in particular. In the South African case, informal developments from waves of land invasions reflect pent-up urbanization after the artificiality of apartheid. During that period, transport severance was a tool to keep people from connecting with urban cores. Engineers have to go back to economics; informal settlements require transport connectivity that is developed in close relation to housing policy. Service industries have an important role to play in the informal sector.?Mall concepts, developed with public participation and transport connections, are powerful ways of consolidating amenities and education to benefit the broader population and motivate private sector developers. The challenge of awarding housing contracts while addressing corruption remains challenging.

?SWEET SPOT

Sowmya Parthasarathy , urban design and masterplanning director with 奥雅纳 , addressed the possibility of finding a sweet spot between ‘top-down’ national programs and ‘plot-by-plot’ grassroot planning. At one end of the spectrum. to address the slum of Dharavi Mumbai, local government awarded a turn-key contract to a single developer; in return for repositioning 35% of the land for market-rate assets, the developer is required to house 1 million inhabitants in the remaining 65% of the two square kilometre area and provide related community infrastructure. This kind of solution accelerates adaptations without great public cost. On the other hand, although every eligible resident ends up in a new home, some identity and local texture is inevitably lost. It is a highly political effort, and mindful that the affected residents vote in elections, the government requires households ?to sign up to the process. At the other end of the spectrum a development in Maputo, Mozambique allows every plot owner to build out their own area, doubling the available density.?This initiative started out as a small scale grassroot pilot before scaling up to its current area. It assumes that residents have ownership or leasehold, which is not always the case in informal settlements.?Self-help is a motivation, and it does show one way to incentivise the private sector within the community to compensate for development risk.?

Siri Arntzen-Ratnarajan Arntzen, economist and Director of Fabric+/AT Arkitektur, has a background in foreign direct investment policy and internationalization. Like her former ARUP colleague Sowmya, she also stressed the importance of balancing between top-down and bottom-up approaches - not parachuting in but building with what exists.?Informal settlements are very place specific, and it is helpful to identify successes that informal populations have created for themselves. She cited the Scandinavian model of creating Innovation Test Beds: the public sector sets the agenda but is open about challenges and often lowers investment barriers during the testing period.

ENGAGEMENT

Tum Kazunga, CEO of Habitat for Humanity/GB, highlighted how good community planning is aware of local cultural practices: informal inhabitants find a way to make their settlements work for their needs.?It is important to observe what works and to harness local ingenuity. The way forward starts in the home: critical factors include housing security and broaden housing choices. Micro-finance is a useful tool in allowing local residents a way to improve their own environments and expand housing capacities – for example in allowing residents to build additional rooms to rent out.

Elliott Hale , a town planner and stakeholder engagement specialist, pointed out that planners and designers normally focus on built form, but that it was more productive to start with the people in the community to establish the social contract. In many ways, informal settlements are already quite organised. Sometimes when things are already working, we can facilitate processes that sit outside of the law, finding ways to pay people informally to grow and maintain services until there are more robust and sanctioned capacities. We can also encourage the micro-level economy by allowing residents to develop themes and local tourism that are attractive to visitors (e.g. related to food, indigenous culture).

CHILDREN

Percy Stubbs , Chief Development Officer of Turquoise Mountain, emphasized showing concrete short-term results that renew a sense of pride; with an initial success, theoretical long-term benefits feel tangible and accelerate buy-in by both residents and private-sector investors.?As an enterprise, Turquoise Mountain focuses on regions where heritage is under threat. It focuses on reviving historic areas by rebuilding heritage crafts, but its orientation is ultimately to develop the capacities of women and children; communities are happier when children are happier. It helps to start from a position of strength by concentrating on assets where identity and potential already exist.

Matthew Hopkinson , co-founder of Didobi, noted that there was often not a big difference between formal and informal urbanization, especially when formal settlement have lost their purpose.?In these circumstances, ‘top-down’ does not work; it’s more important to be ‘hyper-local’ - grand urban masterplans created by talented architects can still ignore unique identities.?He echoed Tum and Percy’s sentiments about the importance of children’s happiness, and how that begins with the perception of safety. As an income analytics specialist he highlighted how well-curated data can produce clear indicators about settlements’ potential.?

VALUE

In the ensuing open discussion, Sebastian noted how informal settlement are usually only perceived as a cost. As an alternative, impact investment initiatives create business models that add up the benefits of valuable outcomes, and also calculate the opportunity costs of not improving local conditions.?He also suggested other parallel strategies: communities need to make their own investments to benefit from repayments. Municipalities often change building codes adjacent to informal developments; capturing land value from up-zoning can incentivise municipalities to become active stakeholders/investors. In the capital markets, they can also define revenue models of sustainability bond with infrastructure-based strategies.?In 2013, government/corporates issued USD $20 billion in impact bonds; in 2022, the comparable value is USD $1.35 trillion (5x growth).

Sowmya pointed out how informal settlers can pro-actively participate in their future.?Successful developments highlight linkages: social value accrues to people, and the corresponding economic value accrues to investors. Some of the most productive developments scale up from test beds, for example Punig/Uttarakhand; a group of farmers hemmed in by urbanization pooled their own land and produced their own masterplan and became their own cooperative developer.

?POTENTIAL

From a spatial point of view, although informal settlements have a lot in common with pre-20th century traditional societies and pre-industrial vernacular architecture, in contemporary times there are increasing examples of ‘living structures’ originally described by theorists like Christopher Alexander and Nikos Salingaros – pattern languages of successful generatively-built communities where residents create innovative adaptive processes and developments on their own.

Ultimately, our workshop discussion recognized that improving the conditions of informal settlements is not just a technical matter, it is fundamentally an issue of assigning rights to individuals who are not well integrated with formal systems; this is the social justice argument – we must be willing to sacrifice economic?value for social impact.?However, government alone can’t address all the related challenges; there are important roles for the private sector.

?Once we become better at defining and measuring system-wide costs and benefits of improving informal urban transformations, we are in a better position to align stakeholder interests and create investment assets that can create the greatest value for the most number of people, while minimizing public costs; this is the utilitarian approach – identify and align the stakeholders who finance improvements, who pay for services, and who receive the broadest range of benefits from urban development.