Luxury Real Estate Comes to Urban Chinatowns

Jennifer Roberts for The Wall Street Journal

Robert Arsenault, an international economic development consultant in Philadelphia, spends $2,540 a month for his two-bedroom in the Goldtex, a luxury building with a concierge, gym and a rooftop pool. His favorite amenity, though, is outside: a slew of authentic Chinese restaurants specializing in everything from Szechuan cuisine to dim sum.

“I eat in Chinatown three to five times a week,” when in town, explains Mr. Arsenault, 64, who is not of Chinese ancestry. He says he moved near the city’s Chinatown to enjoy its “really vibrant, comprehensive culinary experience.”

Forged from a combination of economic necessity and racial discrimination, many of this country’s traditional urban Chinatowns are now attracting a new type of business: luxury real-estate development.

Projects near Boston’s Chinatown include Millennium Place Condos, a 256-unit building that opened in 2013 where units sell for between $1.1 million to $4 million. The Kensington, which also opened in 2013, is a 27-story tower with an outdoor pool and pet-grooming room. Units rent for between $2,700 and $6,800 a month, says Connie Kastelnik, consultant to Boston-based Kensington Investment Co.

Robert Arsenault, a consultant in international economic development, said he moved to a building called the Goldtex so he could be closer to Philadelphia’s Chinatown.

Will Figg for The Wall Street Journal

In the heart of Los Angeles’s Chinatown sits Blossom Plaza. In 2016, developer Forest City West opened the 237-unit building where monthly rents currently range from $1,300 to $2,500. In addition to traditional perks like a pool and gym, Blossom Plaza attempts to “reference Chinese culture” with programming like a Lunar New Year celebration, and Chinese visual cues in the architecture, says Kevin Ratner, president of Forest City West, a unit of real-estate investment trust Forest City, in Cleveland.

In Los Angeles and Philadelphia, prices are increasing at a faster rate in the ZIP Codes encompassing Chinatowns than in other downtown neighborhoods, according to an analysis by realtor.com®. (News Corp, owner of The Wall Street Journal, also operates realtor.com under license from the National Association of Realtors®.)

Chris Kremser, 30, a database engineer and his girlfriend, Liz Barket, a 29-year-old telecommunications attorney, moved to Blossom Plaza in December after relocating from Washington, D.C. They rent a one bedroom with a den for roughly $2,500 a month. The couple, neither of whom is of Chinese ancestry, say they patronize both local Chinese restaurants as well as new trendy places like Apotheke, a “mixology” bar where the average cocktail costs $16.

Liz Barket and Chris Kremser tour their neighborhood. The couple moved from Washington, D.C. to Los Angeles’s Chinatown in December.

Jennifer Roberts for The Wall Street Journal

The living room of the Kremser/Barket home in Blossom Plaza, a new development in Chinatown.

Jennifer Roberts for The Wall Street Journal

As these Chinatowns gentrify, they are also becoming less ethnically Chinese. For a number of Chinatown activists, the entrance of buyers and renters represents worrisome competition for the working-class immigrants who have traditionally lived and worked in these areas.

“It’s a total demographic change. We’re talking about displacement,” says Andrew Leong, an associate professor who teaches law, social justice and Asian-American studies at University of Massachusetts Boston. Mr. Leong co-wrote a 2013 study that found that the percentage of Asian residents in Boston’s Chinatown fell from 70% in 1990 to 46% in 2010; in Philadelphia, the figure dropped from 45% to 42%.

Karen Chen, executive director of the Chinese Progressive Association, a Boston-based community nonprofit, says the influx of high-end housing is pricing out low-wage workers as well as traditional Chinese grocers, restaurants and Chinese-language service providers. Though many Chinese people have spread out to other cities, they still rely on businesses, services and the cultural connections provided by Chinatown, she says.

Mr. Arsenault’s kitchen area.

Will Figg for The Wall Street Journal

The pool on the roof deck at the Goldtex.

Will Figg for The Wall Street Journal

Developers say they are adding to the housing stock in these communities, and say their residents often become patrons of businesses within Chinatown, adding to the neighborhood’s economic strength.

That has been true for Yang Chow, a Sichuan restaurant in Los Angeles’s Chinatown since 1977, says manager Benny Yun. A number of Blossom Plaza residents have become patrons, though overall business hasn’t grown because “there are so many new restaurants” in the increasingly trendy area.

For Chu Huang, a program administrator in her late 20s who lives in Boston’s Chinatown, gentrification of the area has meant higher prices and the loss of many mom-and-pop shops. “Businesses now cater to the wave of upper class folks coming in,” she says.

Some developers say their projects are socioeconomically diverse: About a quarter of Blossom Plaza’s units are affordable housing, using a formula determined by the city, Mr. Ratner says. He describes the building’s residents as a mix of Chinese Americans, Chinese immigrants, non-Asians, families and students at the University of Southern California’s medical school, which is nearby.

Michael Pestronk, chief executive of Post Brothers, says he encountered little resistance to the Goldtex because “in Philadelphia there is still a large amount of low cost developable land adjacent to Chinatown.”

The appeal of Chinatown to an array of residents represents a reversal in the perception of these communities. Chinese immigrants, who first began arriving on the West Coast in the 1840s, were viewed with hostility by the white majority, and the enmity only increased in the ensuing decades, says Ellen Wu, an associate professor of history at Indiana University Bloomington. Immigrants created the first Chinatown in San Francisco around 1850 and soon began forming others, as they were increasingly rejected and restricted from other neighborhoods, Ms. Wu says.

Chinatowns that were built in the late 19th century or early 20th century were usually on the outskirts of cities, where land was relatively inexpensive. But today, cities including Philadelphia, Los Angeles and Boston have grown to the point that their Chinatowns sit within the urban core, making the land more valuable and more coveted. Plus, many potential residents of high-end developments increasingly see Chinatowns as having a unique charm and authenticity.

Charles Yee and his wife Zineb Cherkani Hassani, who rent a one bedroom in the Kensington for about $3,000-a-month.

Bob O'Connor for The Wall Street Journal

Charles Yee, a research scientist in his mid-30s originally from Taiwan, began renting a roughly $3,000-a-month one bedroom in the Kensington soon after it opened. He was drawn by the building’s location near theater, nightclubs and restaurants.

Mr. Yee says that living in the building and being an ethnically Chinese, Mandarin speaker puts him in the midst of two worlds. Waiters in neighborhood restaurants “will say, ‘Oh, you live in the Kensington. You must be rich,’ ” he says.

“I do feel guilty in that I am in one of these high rises that are responsible for the gentrification of the area,” says Mr. Yee. On the other hand, “when I go out, people treat me like a local and I get the special menu,” printed in Chinese characters.

Mr. Yee, a research scientist originally from Taiwan, says that he is often treated like a local in Boston’s Chinatown.

Bob O'Connor for The Wall Street Journal

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