The geopolitics of real estate: assembling soft power via property markets

The article problematizes the role of real estate in geopolitical circulations. The internationalization of real estate increases mutual dependencies and vulnerabilities between nation states and therefore calls for a better appreciation of the geopolitical externalities and exteriorities of real estate. The article brings together disjoint bodies of literature on real estate globalization, assemblage theory, and international relations to show how real estate is a case of the geopolitics of the multiple – geopolitics that is being assembled by diverse and distributed actors, discourses, and materialities representing the contingent and emergent formation of connections and considerations, which affect the ways how foreign relations are negotiated today. The argument is substantiated by considering several dimensions of the real estate/geopolitics nexus: (i) external influences over domestic real estate markets; (ii) the implications of outward real estate investment; (iii) state-led mega-projects conveying externally the power of the state. These dimensions are considered empirically in the context of the renewed geopolitical tensions between a resurgent Russia and the West. Overall, the article calls for a better positioning of real estate in the conceptualizations of soft power, state power, and geopolitics

Statecraft strategies and housing financialization at the periphery: Post-socialist trajectories in Russia and Poland

A new literature on housing and financialization has emerged in recent years, but scholars have yet to examine how political actors shape national trajectories of housing financialization. In this article, we address this shortcoming by examining the cases of Russia and Poland in the 1990-2018 period. We argue that in both contexts political elites implemented a radical market-oriented reshaping of housing finance. However, by pursuing distinct statecraft strategies and modes of integrating the domestic economy into global markets, Russian and Polish political elites created two divergent trajectories of housing financialization. Russian political elites pursued patrimonial statecraft strategies and a mode of global economic integration based on raw material exports. The Putin administration channeled revenues from raw material exports into the securitization-based housing finance system and used this infrastructure as an instrument of hegemonic power. In doing so, the Russian government shielded homeowners from exposure to financial risk. In contrast, Polish political elites pursued liberal statecraft strategies and a mode of global economic integration based on foreign capital inflows. Polish political parties therefore enabled foreign banks to dominate the housing finance system and sell foreign currency mortgages, which exposed homeowners to considerable financial risk. In light of these findings we call for further research into the political factors that shape the process of housing financialization, both in the post-socialist space and beyond

Statecraft strategies and housing financialization at the periphery: Post-socialist trajectories in Russia and Poland

A new literature on housing and financialization has emerged in recent years, but scholars have yet to examine how political actors shape national trajectories of housing financialization. In this article, we address this shortcoming by examining the cases of Russia and Poland in the 1990-2018 period. We argue that in both contexts political elites implemented a radical market-oriented reshaping of housing finance. However, by pursuing distinct statecraft strategies and modes of integrating the domestic economy into global markets, Russian and Polish political elites created two divergent trajectories of housing financialization. Russian political elites pursued patrimonial statecraft strategies and a mode of global economic integration based on raw material exports. The Putin administration channeled revenues from raw material exports into the securitization-based housing finance system and used this infrastructure as an instrument of hegemonic power. In doing so, the Russian government shielded homeowners from exposure to financial risk. In contrast, Polish political elites pursued liberal statecraft strategies and a mode of global economic integration based on foreign capital inflows. Polish political parties therefore enabled foreign banks to dominate the housing finance system and sell foreign currency mortgages, which exposed homeowners to considerable financial risk. In light of these findings we call for further research into the political factors that shape the process of housing financialization, both in the post-socialist space and beyond

New spaces of capital: The Real Estate/Financial Complex in Russia and Poland

English Summary The state-finance-real estate ‘triangle’ found its most spectacular expression in 2007/8 when the collapse of the U.S. mortgage market caused an economic crisis of global scale. Yet, even though financial news is full of implicit references to the interaction between the three dimensions, it rarely explicitly addresses it as issue in its own right. For this reason, Aalbers (2013b:1) has proposed the metaphor of the ‘Real Estate/Financial Complex’ to centre attention on the linkages between these three realms. The present thesis is part of the Real Estate/Financial Complex research programme and studies the Russian and Polish cases. My central objective is to discern dynamics of real estate financialisation and to explain differences in this phenomenon as it unfolds in the two countries. The thesis finds that property markets in both Russia and Poland have become increasingly entangled with the dynamics of financialisation. Yet, the extent of this process and its form differs in the two countries. Russia has experienced very little and discontinuous financialisation of its real estate markets in the past three decades. Here, real estate-financial relations are defined by strong involvement of domestic capital and state actors and dynamics of global commodity markets. Poland’s real estate market in contrast has undergone more comprehensive and continuous financialisation since the inception of market relations. Specifically, real estate is inserted into dynamics of financialisation from a position of subordination, serving as investment outlet for globally mobile capital. In both countries state socialist legacies enable the commercialisation and (partial) financialisation of real estate markets. To explain these differences the thesis foregrounds two dimensions: Russia and Poland’s respective political regimes and distinct modes of integration in the hierarchical global economy. In so doing the thesis does not only extend the literature on the financialisation of real estate to post-socialist geographies, but also contributes to a more nuanced understanding of the process in general. It shows how international and domestic power relations are (re)produced and negotiated through real estate financialisation and, in the process, shape the distinct nature of the latter. Moreover, this thesis draws on and contributes to a wider set of literatures. First, it builds on the core-periphery framework developed by World-systems Analysis and in particular studies that foreground the role of finance and financialisation in reproducing and deepening the hierarchies and divisions of the contemporary global economy. Second, it engages with Jessops’ strategic relational approach to the state and notions of state-space restructuring and assemblage to account for the complex constitution of the state and to analyse real estate-financial relations as one outlet and medium of its power. To better appreciate transformation and the history of state socialism in shaping dynamics of financialisation, I lastly engage with critical literature on post-socialism. I suggest that rather than constraining financialisation, socialist legacies can facilitate its advance and magnify its effects. VIII The study is based on a mix of mainly qualitative methods that are embedded in a historical approach to political economy. These methods include open-ended semistructured interviews and the collection and analysis of a wide range of primary and secondary data sources. During five research stays between 2013 and 2016, I conducted 77 interviews with professionals in the real estate industry, the financial sector, civil servants, urban planners, architects, journalists, and political and urban activists. In part I of this thesis, I set out the context of Russia and Poland’s political economic development to help the reader situate the general findings of the dissertation. In particular, I highlight how different elite constellations, external and internal pressures and endowments have put the two countries on different transformation paths, resulting in distinct political regimes and modes of global economic integration. In part II, I focus on national-level dynamics and examine the interaction of actors and tools of modern finance with the two countries’ respective commercial property markets and housing finance systems. Studying Russia and Poland’s commercial real estate markets, I highlight a common trajectory towards the increasing economic importance of the property sector and its growing entanglement with modern finance, but also identify key differences in this process. In particular, I find that Russia’s commercial real estate market experienced temporary and partial financialisation, which was linked to domestic processes of capital switching. Commercial real estate in Poland, in contrast, experienced more thorough and continuous financialisation as spatial fix for globally mobile capital. I then explore the realm of housing by examining how mortgage markets in Russia and Poland have become exposed to and integrated into global processes of financialisation. I show that even though explicitly embracing securitisation—a key tool of finanicalisation—the Russian mortgage market remains dominated by state actors and is isolated from dynamics of financial markets. The Russian mortgage market is therefore a case of financialisation in form—in terms of the institution of securitisation—only. While the polish housing finance system was not designed to attract global investors and produce financial assets, it has experienced more comprehensive financialisation. The Polish mortgage market is therefore financialised in form—through FX loans—and effect—in terms of risk transmission and the transformation of households into investor subjects. I also examine how Russia and Poland’s states rely on dynamics of real estate internationalisation to reproduce and negotiate their outward-oriented power, in Russia via geopolitics and in Poland through economic integration. This foregrounds the state as assemblage of strategic relations, and as more than a regulatory force. In part III, I shed light on the urban dimension of Russia and Poland’s real estate-financial relations. Towards this, I first trace the evolution of Warsaw and Moscow’s urban political economies since the late 1980s, and then offer case studies of business districts in the two cities. Part IV concludes with a summary of the thesis’ findings and considerations of future avenues for research.status: publishe

The Evolution of Neoliberal Urbanism in Moscow, 1992–2015

This article examines the urban development of Moscow from 1992 to 2015, arguing that the city’s recent transformation from grey asphalt jungle to a “city comfortable for life” is driven by a process of neoliberal restructuring. In particular, the study finds that a set of multi-scalar dynamics—namely, the global financial crisis, the rise of a local protest movement, and an intensified rivalry between federal and Muscovite elites—were the key driving forces behind Moscow’s current evolution. The work advances a conceptual framework of neoliberal urbanisation that enhances the literature on post-socialist cities and, more generally, the broader debate on actually existing neoliberalism.status: publishe

The City Under COVID-19: Podcasting As Digital Methodology

This critical commentary reflects on a rapidly mobilised international podcast project, in which 25 urban scholars from around the world provided audio recordings about their cities during COVID‐19. New digital tools are increasing the speeds, formats and breadth of the research and communication mediums available to researchers. Voice recorders on mobile phones and digital audio editing on laptops allows researchers to collaborate in new ways, and this podcast project pushed at the boundaries of what a research method and community might be. Many of those who provided short audio 'reports from the field' recorded on their mobile phones were struggling to make sense of their experience in their city during COVID‐19. The substantive sections of this commentary discuss the digital methodology opportunities that podcasting affords geographical scholarship. In this case the methodology includes the curated production of the podcast and critical reflection on the podcast process through collaborative writing. Then putting this methodology into action some limited reflections on cities under COVID‐19 lockdown and social distancing initiatives around the world are provided to demonstrate the utility and limitations of this method

Round the Houses: homeownership and failures of asset-based welfare in the United Kingdom

This article explores the contingencies of financialisation and housing. More specifically, how the spatial and temporal dynamics of the UK housing market ensure that homeownership does not (and arguably cannot) deliver welfare provision in the way envisioned by asset-based welfare initiatives. The first section demonstrates the fundamental problem of conceptualising households as assetholders; in particular, with regard to housing-based welfare strategies and as part of financialised growth strategies in the UK, more generally. We show that continuing to assume residential housing is a static and unchanging asset-class depoliticises how asset-based welfare intensifies household indebtedness. The second section demonstrates the temporal, spatial and social limits of homeownership in the UK. We argue that the financialisation of housing in the UK is a unique set of political and economic circumstances that cannot be repeated; therefore, current gains from residential housing are a one-off wealth windfall to particular (lucky) groups within society. The temporal and spatial limits of gains from residential housing mean that the same conditions cannot be repeated (often enough) in the way required for residential housing to provide a generalisable welfare function. Finally, the article concludes by suggesting the potential of new research that incorporates temporal, spatial and social contingencies of housing to demonstrate how financialisation materialises in everyday life