Paper presented at INURA conference, “Right to the Planet – Reconsider the Urban Question”, June 29-30, 2023, Switzerland
The transformation of state socialism into capitalism happened in Romania starting in the early 90s through a dramatic de-industrialization process, which significantly impacted many major economic centers. Some of these industrial cities never managed to recover and underwent a gradual path of de-population and urban decay. Others have converted to an economy more oriented towards services or have launched a late re-industrialization process that enabled economic growth and new forms of urban polarization. Overall, the new industries specialized in low-added value products within the global capitalist production chain and made little use of the large industrial platforms built during the socialist period. Our paper focuses on the genealogy of these emerging brownfields within post-industrial cities and analyses the economic and administrative processes through which they became an object of urban regeneration policies and transnational capital investments in real estate. The literature on urban entrepreneurialism and variegated forms of capitalist urbanization (Harvey, Brenner, Theodore, Peck, Schmid, Rossi, etc.) informs our theoretical endeavour. We are researching the connection between urban development policies, entrepreneurialism, and large-scale real-estate projects that enable capital accumulation and restructure class relations.
To describe this larger process, in our paper, we use the case of capitalist urban (re)development in a second-tier and a third-tier city from Romania (Brașov and Reșița), both important industrial centers of the former socialist economy. Before the 1990s, Brașov was among Romania’s top industrial centers and cities (with above 320000 inhabitants), losing its productive capacities after the bankruptcy of its factories but slowly regaining regional economic importance due to the multinational companies with German capital. Reșița was a smaller town (around 100000 inhabitants, but it was one of the most important industrial cities from Romana, specializing in steel industries and complex machine construction. We view the current connections between these cities by addressing how they were shaped via a capitalist re-urbanization process mediated by two international actors and the relationship they established, through partnerships and expertise, with local administrations. Their joint efforts eventually transformed the built environment of the localities into a profitable circuit of capital. Our analysis focuses on the consolidation within the local states of new entrepreneurial governance and on a new urban strategy aiming at regenerating the city and, most importantly, the large decaying industrial platforms.
One of the mentioned international actors in both cities is the former real estate branch of the French Auchan company, Immochan, which transformed in 2018 into Ceetrus, owned by the Mulliez Family Association. Ceetrus defined itself not as a simple retail company but as an urban developer implementing projects with mixed functions (retail, housing, and office), being the owner of a diverse global property portfolio. Merging with Nodi in 2021, Ceetrus became part of a new mixed-use property management and development services company, Nhood. In Brașov, Ceetrus started its businesses in 2010, buying the 120 hectares of Uzina Tractorul industrial real estate: it first made the Coresi Shopping Resort; afterward, together with a local developer (Kasper Development), it built the Coresi Residential District; and finally, in 2017, created the Coresi Business Park that started via purchasing the office buildings of Ascenta Management. In 2020, Ceetrus announced that it started an urban regeneration project in Reșița on the former 36 hectares large Mociur platform of Combinatul Metalurgic Reșița, in its socialist past being one of the most productive steel factories in the country. This announcement referred to the success of the Tractorul-Coresi real estate development from Brașov. Furthermore, it defined it as a model of community regeneration to be followed in other cities and even smaller towns, which were the least likely places to host such big real estate developments and transnational companies.
The second international actor in both cities under our scrutiny is the World Bank. Via its developmental consultancy role played in Romania at the national and local levels, it supported the City Halls of both Brașov and Reșița with some policy tools for urban development. The WB discourse about a new urban politics – elaborated around concepts such as competitive cities, magnet cities, cities as engines of economic development, or urban regeneration – became one of the most influential factors of public policies in Romania [1] after setting up the urban agenda of the 1990s for the developing countries across the globe [2]. In Romania, this happened following the 1990s and 2000s. Priorly, the organization played an essential role in privatizing industrial platforms across the country, which in most cases led to their liquidation.
In addition, our paper aims to highlight how the local governments, under the impact of the foreign investor and the international financial organization mentioned above, are reinventing themselves as embodiments of entrepreneurial governance. Their objective is to actively contribute to the co-creation of the cities, which are supposed to be revitalized after the collapse of state socialism by attracting (foreign) investors and a middle class ready to consume the expensive new real estate developments. These efforts happen under conditions where local budgets are constituted mainly through property and corporate taxes, dependent on capitalist economic growth. Following two strategies, Reșița City Hall promises to transform the former proletarian town into a ’boutique’ city dedicated to the aspiring middle class. On the one hand, it seeks to be a direct investor in the brownfields it owns; on the other hand, it enters public-private partnerships to attract foreign direct investments to regenerate former industrial platforms. In turn, Brașov City Hall supported the transformation of the former Tractorul company into the Coresi real estate development via some infrastructural works within the area. Moreover, it continued supporting it with plans to create a green recreational zone in the Northern vicinity of the Coresi district. The latter is on another to-be-regenerated industrial platform (Rulmentul Brașov, a former bearing manufacturer in Romania), where City Hall is the principal property owner and is advised by the World Bank in this effort.
In both cases, one may observe the endeavor of the local governments to assume a more active role in urban planning than they did in the prior decades when they reduced themself to authorizing private urbanistic plans. Nevertheless, in parallel with this, their understanding of public interest and collaboration with private actors are also changing. Noticing this makes us wonder about the political alternatives to neoliberal urbanism and governance within capitalism and beyond.
[1] https://citadini.ro/, https://www.worldbank.org/en/country/romania/brief/romania-urban-development,
[2] https://elibrary.worldbank.org/doi/abs/10.1596/0-8213-1816-0