Figure 1, taken by 'Zinneke' on 16 September 2017, CC 3.0
Luxembourg City is still struggling with the consequences of its rapid growth, as a range of large-scale urban projects are currently in planning, being built or finalised, while major pieces of infrastructure renovation (road, water, sewage) and hundreds of cases of micro-construction are going on simultaneously. The Capital City actually looks like a huge construction site, and the outcomes of some recent projects are disputed to say the least. There is disillusion about what has evolved recently in the shape of the 1980s urban design and motor-car dominated street layout of the district called ‘Cloche d’Or’. There are also high hopes as to flagship projects such as the light rail ‘Tram’ that will not only produce a smooth connection between the main central train station 'Gare' with the banking district on Kirchberg in due course, but will also turn the city centre quite visibly into a site of urban regeneration.
Moreover, after more than a decade of silence, rumor and speculation, one of the biggest fillets of urban development and property exploitation gets back to life: Place de l’Etoile, or Stäreplatz in Luxembourgish.(1) Having been a mere urban brownfield or empty spot for a long time (see Figure 1), this western entry point to the city centre already got some attention in the media a few years ago, when the lot was purchased by the state-led Abu Dhabi Investment Authority in 2016. For some time, it was supposed to host another large-scale urban project fit for commerce and office, following Hamilius and Cloche d’Or that were completed in the 2010s and the massive Porte de Hollerich that still looms on the planning stage. Given the peculiar mechanisms of the real estate economy, the new owners have obviously been waiting for a good moment to get market transaction and development unleashed, which seems to have arrived now.
Last Monday, city and government officials presented their plans for the Place de l’Etoile(2): a massive mixed-use development project comprising housing, office and retail, complemented by smart and clean public spaces. While its appeal seems to be in line with the projects mentioned above, a couple of interesting innovations could be noted on this occasion, also compared with earlier planning practices of the Capital City. First, the focus is switching from the once most lucrative office and commerce sectors towards increasing housing supply. Obviously, a significant market change makes luxury apartments and condominiums a promising addition to the city’s real-estate portfolio; due to humble policy goals, only a ten per cent-share of housing floor space is required by regulation to be devoted to housing at “moderate” cost (moderate by the country’s measure). By increasing focus on luxury housing by elevating the share of housing from 12 to 47 per cent of the total floor space provided, the existing building plan needs to be adapted to changing demands from the developer. (To apply such amendments after plans are politically agreed upon is actually a rather common pattern in the city’s planning practice).
Second, a green transport package is applied with which this project is sold to the public, which also explains the pro-active role taken over by the Minister for public works and transport who is from the Green Party. The package includes an additional leg of the tram system, connecting the city centre with the western suburbs. This is considered a smart move, as it legally ensures a major part of the infrastructure to be financed by the state, not the city or the developer. In addition, a sort of underground bus terminal will transform the Place de l’Etoile into a mobility hub, where major bus lines will feed into the tram system as long as this is serving the inner city only. Tram, trees and green roofs give the whole project an environmental appeal, without knowing how seriously this can be taken.(3) Third, it happened for the first time that we observed the developer in charge joining the press conference of Mayor and Minister. Usually this actor group remains as discrete as possible or invisible, even though there is some indication that they play a central role in the planning and building circuit of the country. It is not totally clear what this means, but it is of course pretty unusual and not often seen before, if at all.
Two questions remain as a consequence of this observation. One concerns the negative externalities of the project. Actually, the government’s official rhetoric deems a politics of ‘decentralised concentration’ necessary, in order to re-balance the overheated spatial economy of the country, with the Capital City being the sponge in the middle.(4) However, in fact Mayor and Ministers work exactly on the opposite: to shift an increasing amount of investment to Luxembourg City. While land is scarce and building high-rises is not considered appropriate, this also means that much of the construction goes to the underground: basement levels, parking garages, delivery zones and the like. “Urban fracking” was the term the former planning director of the city of Munich, Germany, used for this phenomenon.(5) As to the project as such, there are further questions: Who needs another polished, posh shopping district in the Capital? Who needs more of the same – office space, luxury lofts – while the real crisis is the dramatic lack of housing for both middle and working class? In case one is concerned about issues of affordability or social inequality, this is simply the wrong perspective: It’s the economy, stupid – particularly in an environment where the market rules, supported by the facilitating hands of the public sector.
This judgement leads to the second question that calls for making sense of the particular policy, or governance arrangement, that is at play here. Among the many frames academic debates have provided in the past for proper interpretation, feel free to choose what fits. Of course, one might be reminded of the “growth machine” approach from the 1980s, observing coalitions of public admin and politics, business and the media joining in their interest to foster economic development. This approach became outdated for a while but has been re-discovered more recently.(6) One of the currents that might particularly fit here is “entrepreneurial municipalism”,(7) backed by the enduring power of financialization.(8) While the former includes a rather pro-active role taken over by public actors, the latter emphasizes the influx of foreign capital into cities, simply for the purpose of creating revenue: Buying in and selling the city out for profit. As the new loft owners may rarely touch base in the city (which is often the case), this also means that housing construction for this target group won’t solve any related problem, but perhaps even increase scarcity.
Entrepreneurial municipalism represents a public administration composed of small state and capital city, being pro-business but only partly operating like an entrepreneur. Our take here was to merge the two in the concept of the ‘city-state formation’.(9) Luxembourg is a perfect example of this. At both levels of policy making, the undisputed goal is to create and maintain the definitive place for attracting businesses of all kinds (the triple-AAA rating being the holy grail of national identity); this desire is only poorly buffered by a re-dressing of public space and measures to make the city beautiful. Yes, the market rules, but it unfolds in real life only through the facilitating hands of city and state. This is a central framework condition for any practice in planning, building and urban terms. Therefore, it should not be neglected when present and future challenges are being discussed, such as climate change, social equity, or COVID-19.
Last but not least, the way the plans for Place de l’Etoile are brought to us like a revelation also poses key political questions.(10) One may wonder about the City’s promise to have citizens involved in major issues of urban development: It is not so long ago that the public realm was flooded with participation on the new land use plan (PAG) – highlighting thousands of details without discussing the general direction to take. Now, when plans are getting concrete and binding, citizens are not asked at all whether this would be appreciated or not. The new outline of Place de l’Etoile comes as tailor-made in the light of what development demands for. Hence the public will most likely miss the chance to intervene. Or is this wrong? One may ask whether this is better or worse compared to the projected new neighbourhood at Route d’Arlon, which is close by. For that development, one might recall that citizens were asked for their opinion on selected plans; however, the specific outcome of their involvement hasn’t been revealed to the public yet.(11)
Overall, this practice appears quite specific, as many other things going on in this country in urban terms. Sometimes it looks as if the urban process is driven by the controlled environment of a gold mining town, which is reluctant to become a city for all, not to speak of a real metropolis. Mir wëlle bleiwen …, yes or no?
1) See our related entry on this Blog from June 2018.
2) Details on the project can be obtained from the City’s webpage .
3) Suspiciously, the green tone in which the roofs appear has already been used for many other projects’ design brochures.
4) The scenario favoured by the government is termed ‘Organisé et harmonieux’, that is, a development of the country’s territory that is organic/evolutionary and harmonic. In fact, it doesn't really conform to that.
5) I am indebted to Stephan Reiß-Schmidt for framing this issue so nicely.
6) Lambelet, S. (2019). Filling in the resource gap of urban regime analysis to make it travel in time and space. Urban Affairs Review, 55(5), 1402-1432.
7) Thompson, M., Nowak, V., Southern, A., Davies, J. & Furmedge, P. (2020). Re-grounding the city with Polanyi: From urban entrepreneurialism to entrepreneurial municipalism. Environment and Planning A: Economy and Space, 52(6), 1171-1194.
8) Aalbers, M. B. (2020). Financial geography III: The financialization of the city. Progress in Human Geography, 44(3), 595-607.
9) Hesse, M. & Wong, C. (2020). Cities seen through a relational lens. Exploring niche-economic strategies and related urban development trajectories of Geneva (Switzerland), Luxembourg & Singapore. Geographische Zeitschrift (GZ), 105, 78-92.
10) Hesse, M. (2017). Herausforderung partizipative Stadtplanung. Ons Stad Nr. 115, 16-18.
11) See the establishment of a new NGO on participation exactly evolving from this case, also the press coverage in the Luxemburger Wort, 21 September 2020, 18.