Introduction

Chile is enjoying sustained economic growth accompanied by a boisterous real estate market, transforming its capital, Santiago. De Mattos (1999) states that this is the product of a strategy of economic liberalisation that has been in operation since the 1970s. This transformation is identified in the many manifestations of investment across the city, including inner-city renewal. These operations are taking place within an existing urban social context characterised by inequality and spatial segregation (Sabatini et al, 2001; Rodriguez, 2008). In this context, the concept of ‘gentrification’, while having been discussed for some time within academic and government circles in Chile, is now emerging in recently published academic work that, for the most part, is focused on metropolitan Santiago (see López-Morales, 2008, 2010, 2013; Contreras, 2009, 2011; Sabatini et al, 2009; Borsdorf and Hidalgo, 2012; Inzulza, 2012; Janoschka and Casgrain, 2012; López-Morales et al, 2012).

The main body of this work concentrates on new-build gentrification, by way of contrast, there is comparatively little evidence concerning urban renewal in inner-city Santiago through the rehabilitation of existing structures. The focus on new-build gentrification is understandable given its residential impact; however, it leaves an important field of urban development under-examined: the commercial-oriented transformations that are putting pressure on residential neighbourhoods in inner Santiago. If viewed under the lens of gentrification, this process could broaden the debate in Chile to include fields of urbanisation where profit is made through the exploitation of distinctive neighbourhood cultural attributes.

Our case study is the neighbourhood of Italia-Caupolican in central Santiago, where there is strong evidence of conflict between the long-established land users, the residential inhabitants and tradespeople (who satisfy local everyday needs), and the new entrepreneurs who are focused on innovating consumerism (and who aim to captivate a floating elite population). The circumstances of a change in landscape brought about by reinvestment in both the tangible and intangible cultural attributes of the neighbourhood is important to gentrification debates in Chile and serves as a warning of a powerful business model that could potentially be rolled out in other similar neighbourhoods in Santiago.

In this chapter, we apply the concept of ‘gentrification’ developed in the Global North to similar processes of change observed in Italia-Caupolicán.