Containing Gentrification: A Story from the Nation’s Capital

This is the third article in NPQ’s series titled Owning the Economy: Stories from Latinx Communities. Coproduced with the National Association for Latino Community Asset Builders, a national network of Latinx community development groups, this series highlights community preservation, land ownership, and business development efforts in Latinx and immigrant communities across the country.

Gentrification is a complex and sensitive issue facing residents in many US cities. In Washington, DC, the gentrification process has been extraordinarily pronounced—with metro neighborhoods showing among the greatest level of resident displacement of any US city. A 2019 study found that between 2000 and 2013 at least 20,000 Black residents had been displaced from the city’s neighborhoods.

Into this mix has come the Purple Line—a $3.4 billion, 16.2-mile light-rail line project. On the positive side of the ledger, the Purple Line promises to provide public transit connectivity to residents in many Montgomery County and Prince George’s County communities in suburban Maryland. At the same time, the transit line—and the development that it portends—threatens to accelerate resident and business displacement. Construction began in 2017, was stalled due to now-resolved legal challenges, recommenced in 2022, and is slated to be completed in 2026.

Transit projects can be dangerous for small businesses, especially small businesses owned by people of color, for two reasons. First, there is the disruption of the construction project itself. Second, even before the transit project is complete, real estate prices often rise, leading to knock-on effects that raise rents and often price businesses owned by people of color out of the community. 

With the Purple Line, the stakes are high. Many of the suburbs along the corridor, particularly those in Prince George’s County, have historically been cultural and economic hubs for immigrant and BIPOC communities. 

The demographic data are clear. In the west in Bethesda and Chevy Chase, both in Montgomery County, the population is nearly 75 percent White—and wealthy: Bethesda’s median household income is $178,000 while in Chevy Chase that number climbs to $250,000. Meanwhile, Riverdale and the International Corridor, both in Prince George’s County, are more than 85 percent BIPOC and median income is more modest ($64,000 in Riverdale and $71,000 in the International Corridor). 

Businesses in these communities knew a new transit line was likely to upend their local communities and that they had to organize to protect their interests. Because construction will continue for three more years (at least), the struggles are ongoing.

Nonetheless, what has emerged is an inspiring story of a Black and Latinx community learning to organize itself. There is much to be learned from these businesses turned reluctant community organizers. Negotiating the politics of transit projects is not easy. But in doing so, these business owners are working hard to make development without displacement a reality in a region where gentrification and displacement of BIPOC communities has too often been the norm. 

Protecting Community Businesses

When external changes impact a commercial corridor, nearby longstanding small businesses are often disrupted, displaced, and closed.

Given the demographics, it is likely that displacement effects associated with the Purple Line will be felt most intensely by the immigrant, Latinx, and Black communities. This potential displacement marks at least the second time these groups have been pushed out by redevelopment and rising property values in the region. In the 1990s, similar cost-related shifts pushed people of color- and immigrant-owned businesses out of Washington, DC. Today, gentrification is reaching into the same Maryland suburbs where people of color relocated previously.

When external changes impact a commercial corridor, nearby longstanding small businesses are often disrupted, displaced, and closed. Take the case of Atinuke “Tinu” Ogunsalu and her family, who established roots and built wealth in Riverdale Park, MD, after migrating to the United States from Nigeria. Ogunsalu and her family opened their restaurant in 1998. Called Queensway, the award-winning restaurant serves West African cuisine.  

Ogunsalu spoke at the Purple Line Corridor Coalition’s first “Annual Celebration of Community and Leadership.” The coalition is an intentional collaboration that seeks to advance an equity focus to address the risk of small business displacement in BIPOC communities. The inaugural meeting helped underline the tensions inherent in large-scale economic development projects. 

Ogunsalu talked about the construction’s effects on her family-owned business. She also spoke about how interventions from members of the coalition have bolstered her faith in the future of her business. Coalition members include a range of public and nonprofit partners, including the two county governments, the National Center for Smart Growth at the University of Maryland, and housing and community business support groups.

Among the coalition participants is the organization I work for, the Latino Economic Development Corporation. Our nonprofit serves as a community development financial institution and provides technical assistance to BIPOC and immigrant-based businesses, with a focus on the Latinx community. Ogunsalu first contacted LEDC to apply for a Paycheck Protection Program forgivable loan after being rejected by a major financial institution. But now Ogunsalu had to address the potential of displacement due to the transit construction project. 

Learning from Our History

As noted above, the greater Washington, DC, region is no stranger to gentrification. An earlier example of development in suburban Maryland was the Wheaton Revitalization Project, designed to house several Montgomery County government offices and the Maryland-National Capital Park and Planning Commission. Construction began in 2017. The 308,000-square-foot,14-story building was completed in 2021. However, this project significantly impacted small businesses in the neighborhood.

The construction site included a county-operated parking lot. During construction, parking spaces for the hundreds of primarily Latinx and immigrant-owned microenterprises in the neighborhood were reduced from 126 to 15 heavily regulated parking spaces. Construction also brought road closures, utility shutoffs, disruption in pedestrian walkability, noise, and dust. These disruptions led to a loss of revenue and, in some instances, immediate closure.

The Small Business Assistance Program administered by Montgomery County’s Department of Finance provided financial assistance of up to $125,000 through an impact-based grant. The program also required that participating businesses receive technical assistance from a nonprofit partner, in this case, LEDC. This public-nonprofit partnership helped more than 60 businesses surrounding the construction site survive the construction period. 

Legislative Victory

Advocacy strategies are a vital element in how this coalition came together to support small businesses along the Purple Line Corridor—especially in BIPOC, immigrant, and Latinx business districts. It was understood that organizing with small businesses is challenging. Leverage is typically held by the landlord. Commercial leases routinely include clauses that assign all repairs to the tenant, require personal guarantees, and assess excessive Common Area Maintenance Charges. The need to develop a robust organizing action plan and strategy was obvious.

For LEDC, a focus area of our Purple Line advocacy was along the Bonifant Street corridor in downtown Silver Spring. A key vector of the strategy was legislative. Prodded by LEDC, local business owners, and our allies, in 2018, Maryland Delegate Jheanelle Wilkins introduced House Bill 0978, which would provide a tax credit to businesses affected by construction. While there had been previous county initiatives to support small businesses impacted by construction disruption from county projects, there was no precedent at the state level, which meant there was a significant need for education and advocacy to peer legislators.

The 2018 effort fell short, but that was only the first attempt. In 2019, LEDC staff organized meetings between Delegate Wilkins, county officials, Purple Line transit partners, and Bonifant Street business owners. We invited two business owners to testify in Annapolis to support an impact mitigation program for small businesses. 

Ultimately, Wilkins’s bills became the foundation of the Transit Safety and Investment Act, which passed in 2021 and established a $2 million grant program for fiscal years 2023 and 2024. As the Sierra Club’s Maryland chapter noted, passage required a broad coalition including support from environmental, transportation, business, labor, disability rights, civil rights, education, workforce development, faith, healthcare, and community groups.

A Larger Challenge

Power, influence, and organizing show up differently in the communities that we serve. Along the corridor’s more affluent, White sections residents could hire lawyers and sue the construction authority, which was done repeatedly. Those lawsuits, although failing at every turn, have added to the chaos of construction and have contributed to project setbacks. The resulting multiyear delays weigh heavily on BIPOC and immigrant communities that rely on their family businesses for their livelihoods. 

If [neighborhood residents] leave…so too will the Spanish-speaking businesses that rely on them.

One example of what is at stake can be seen in La Unión Mall, an indoor Latinx shopping mall in Langley Park near the border of Montgomery and Prince George’s counties. The shopping center is part of a broader majority-Latinx commercial district. This area along University Boulevard, known as Maryland’s International Corridor, is home to one of the region’s largest Latinx communities and dozens of pupuserias (which sell stuffed corn tortillas), Central American bakeries, and supermarkets that sell piñatas alongside tortillas.

Jorge Sactic, the owner of Chapina Bakery, said he could start making doughnuts and bagels to complement his specialty Guatemalan bread if his clientele changes. But he worries that many neighborhood residents, including those who cram into apartments to share rent costs, will be priced out. If they leave, he said, so too will the Spanish-speaking businesses that rely on them. 

Sactic, it should be noted, is not just a business owner but a community leader who is regularly cited in local media. His influence was clear when we visited as we witnessed individuals approaching him as he sat and drank coffee outside his tiny bakery. In 2022 he ran for the Maryland House of Delegates. While he only received two percent of the vote, his candidacy speaks to the desire for small business owners like him to have much more of a say in the political process.

There remains much work to do. The fact that the Purple Line has faced multiple delays and won’t open until fall 2026 at the earliest means we are very much in the middle of this struggle. We understand the road is long and the need for advocacy is ongoing. 

The Purple Line, of course, is a complex project that is not only expensive but also touches many communities. These include both wealthy, largely White suburbs on the western end of the line in Montgomery County, and the majority BIPOC suburbs in the central part of the line (still in Montgomery County) and on the eastern end of the line in Prince George’s County. 

In 2018, the coalition, of which LEDC is a steering committee member, formed its Small Business Action Team. LEDC co-chairs this group, which consists mostly of technical assistance providers along the corridor, to coordinate services and efforts to preserve small businesses affected by the construction. 

This work is a small part of a hard-won community development agreement, which only occurred after significant public pressure. Indeed, the existence of the coalition itself was the product of years of organizing. More than 150 “labor, environmental, civic, and business groups, as well as local officials [came together] to form the Purple Line Corridor Coalition,” according to Dan Reed of the leading DC local news site, Greater Greater Washington. Goal one of the coalition could not be clearer—to ensure that “diverse, locally established businesses prosper both during and after the construction period.” 

This effort has led to some wins. The community development agreement of 2018 and the legislative victory of 2021 have helped fund technical assistance that is keeping many BIPOC-owned businesses alive. For example, during an outreach visit to the Queensway Restaurant owned by the Ogunsalu family, a coalition consultant learned that the business had been operating without air conditioning and in a severely deteriorated building. It appeared that the owner was actively disinvesting in the property. 

The consultant flagged the case for further discussion, leading to a walk-through with local government officials, area community members, nonprofit partners, coalition staff, and additional consultants. The visit led to new knowledge about a municipal code enforcement policy that had recently been extended to cover commercial properties. As of the fall of 2022, some cleanup occurred at this commercial plaza. What began as outreach by one nonprofit flourished into a working relationship with a community of stakeholders who understand the importance of protecting legacy businesses such as Queensway Restaurant.

However, the displacement risk persists. To address this, the coalition is forming a loose real estate working group to understand the financial, policy, and development mechanisms available to support Queensway and other businesses. 

An Ongoing Struggle

While there have been many individual business wins, there is no tool available to fight the cynicism or feelings of disenfranchisement or disempowerment when businesses see inaction from the local government and its partners.

Small businesses along the Purple Line light-rail construction project still struggle to access the capital they need to survive. Recently, the coalition has been making efforts to contract with commercial real estate brokers to focus on supporting small business relocation, preferably along the Purple Line construction corridor; identifying existing vacancies and opportunities; and attracting new entrepreneurs. Another priority is strengthening commercial renter protections in Prince George’s County.

Coordination among transit authorities, local government agencies, and community-based organizations is critical to mitigate the negative impacts of construction and to avoid displacement stemming from the rising commercial rents that greater transit access typically brings.

The good news is that while the challenges facing small businesses along the Purple Line project are complex, viable solutions do exist. Groups like the coalition advocate for policies that support equitable development, help preserve small businesses, and create opportunities for new entrepreneurs. 

It will not happen overnight, but with continued effort, the Purple Line Corridor can become a thriving hub for building community wealth in Black and Latinx communities in Prince George’s County.