TO HAVE OR NOT TO HAVE, THAT IS THE QUESTION: The Unseen Dimensions of Housing Question in Turkey

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Emrah Altınok "To have or not to have, that is the question: The Unseen Dimensions of Housing Question in Turkey, The Case of TOKİ-İstanbul in Post-2000 Period", The Housing Question - Nomad Seminar, University of San Diego, March 12-13, 2015 1 TO HAVE OR NOT TO HAVE, THAT IS THE QUESTION: The Unseen Dimensions of Housing Question in Turkey The Case of TOKİ-İstanbul in Post-2000 Period Emrah Altınok * Abstract Housing investments in Turkey and İstanbul have demonstrated a significant increase over the last 10 years. The key player in this increase is Housing Development Administration of Turkey (TOKİ) 1 , a prime ministerial agency, producing and procuring housing projects for various income groups. With additional functions other than housing projects, TOKİ emerges as an institution directly steering the real estate market in metropolitan areas through its administrative privileges in sales of state properties, expropriation, land development and urban renewal. Despite the strong opposition to the projects due to their detrimental effects on social and ecological balances, TOKİ driven housing projects and accompanying mega infrastructure investments still serve as the one of the key resources for the politics of Justice and Development Party (AKP) which managed to hold the power since 2002. In line with the fundamentally adopted macro-economic approach, TOKİ, emerging as a 'state apparatus' out of the transformation leading to institutionalization of neoliberal economy, is responsible for the regulation of the economy through real estate market after 2002. David Harvey’s Theory of Spatio-Temporal Fixes focusing on the relationship between capital shifts to real estate market as a result of over-accumulation crises (such as 2000-2001 crisis in Turkey) offers explanatory opportunities to analyze the internal variables of the housing phenomenon from a political economy standpoint. According to some other approaches, this phenomenon – in the form of social housing – has a function of redefining the consumption relationships, and besides curbing social contradictions in a modern capitalist society. However, the so called social housing projects implemented by TOKİ are not actually affordable for the target audience to begin with, furthermore, the projects resulting in land transferred to the private investors essentially translates into a regime of accumulation and modes of regulation simply based on the uneven (re)distribution of wealth. Consequently, the very phenomenon is deepening the social contradictions rather than to appease. The urban space continues to disintegrate, particularly as a result of the mega projects and mass housing investments, in parallel with the ongoing decomposition of social relations and increasing distinction among social classes. This paper, building on the results of the doctoral dissertation research completed in January 2012 and updated with current observations, primarily floodlights the historical transformation of the country's housing policies, followed by the scrutiny of housing projects implemented in İstanbul by TOKİ. In this sense, as well as general statistics on supply & demand, production & consumption capacities, the relationships between 'political rhetoric' and 'reality' are discussed. In the light of the findings, it has been concluded that a switch to a new housing and development model took place, presenting advantages and disadvantages for different social and political strata. Keywords: Housing Development Administration of Turkey (HDA / TOKI), 2000-2001 crisis, Post 2000 Period, Theory of Spatio-Temporal Fixes, Accumulation by Dispossession, State-led Dispossession, Displacement, Loan Dependent Housing Market, Indebtedness, Stability of Economy. * Emrah Altınok, PhD [Asst. Prof.] Department of Architecture, Faculty of Architecture, İstanbul Bilgi University, Eyüp, İstanbul, Turkey. e-mail: [email protected]

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Proceedings:The Housing Question I Nomad Seminar - San Diego I University of San Diego I March 12-13, 2015TO HAVE OR NOT TO HAVE, THAT IS THE QUESTION:The Unseen Dimensions of Housing Question in Turkey The Case of TOKİ, İstanbul in Post-2000 PeriodABSTRACTHousing investments in İstanbul have demonstrated a significant increase over the last 10 years. The key player in this increase is TOKİ , a prime ministerial agency, producing and procuring housing projects for various income groups. With additional functions other than housing projects, TOKİ emerges as an institution directly steering the real estate market in metropolitan areas through its administrative privileges in sales of state properties, expropriation, land development and urban renewal. Despite the strong opposition to the projects due to their detrimental effects on social and ecological balances, TOKİ driven housing projects and accompanying mega infrastructure investments still serve as the one of the key resources for the politics of Justice and Development Party (AKP) which managed to hold the power since 2002.In line with the fundamentally adopted macro-economic approach, TOKİ, emerging as a 'state apparatus' out of the transformation leading to institutionalization of neoliberal economy, is responsible for the regulation of the economy through real estate market after 2002. David Harvey’s Theory of Spatio-Temporal Fixes focusing on the relationship between capital shifts to real estate market as a result of over-accumulation crises (such as 2000-2001 crisis in Turkey) offers explanatory opportunities to analyze the internal variables of the housing phenomenon from a political economy standpoint. According to some other approaches, this phenomenon – in the form of social housing – has a function of redefining the consumption relationships, and besides curbing social contradictions in a modern capitalist society. However, the so called social housing projects implemented by TOKİ are not actually affordable for the target audience to begin with, furthermore, the projects resulting in land transferred to the private investors essentially translates into a regime of accumulation and modes of regulation simply based on the uneven (re)distribution of wealth. Consequently, the very phenomenon is deepening the social contradictions rather than to appease. The urban space continues to disintegrate, particularly as a result of the mega projects and mass housing investments, in parallel with the ongoing decomposition of social relations and increasing distinction among social classes. This paper, building on the results of the doctoral dissertation research completed in January 2012 and updated with current observations, primarily floodlights the historical transformation of the country's housing policies, followed by the scrutiny of housing projects implemented in İstanbul by TOKİ. In this sense, as well as general statistics on supply & demand, production & consumption capacities, the relationships between 'political rhetoric' and 'reality' are discussed. In the light of the findings, it has been concluded that a switch to a new housing and development model took place, presenting advantages and disadvantages for different social and political strata. According to this, the housing paradigm which started as the struggle of rural populations migrating to metropolitan areas in the 1950s and holding on as "squatters", first took a form of "self-urbanization" enabling the urban lower-middle and middle class taking advantage of state subsidized loan opportunities through "housing coops" in the wake of 1980s; and today it has transformed into a new model of state-led "dispossession” (enforced relocation of the poor / privatization of public assets, natural resources) and “possession” (by encouraging those who wish to acquire real estates to taken on loans, making them dependent on the stability of the economic and political syste

Transcript of TO HAVE OR NOT TO HAVE, THAT IS THE QUESTION: The Unseen Dimensions of Housing Question in Turkey

Page 1: TO HAVE OR NOT TO HAVE, THAT IS THE QUESTION: The Unseen Dimensions of Housing Question in Turkey

Emrah Altınok "To have or not to have, that is the question: The Unseen Dimensions of Housing Question in Turkey, The Case of TOKİ-İstanbul in Post-2000 Period", The Housing Question - Nomad Seminar, University of San Diego, March 12-13, 2015

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TO HAVE OR NOT TO HAVE, THAT IS THE QUESTION: The Unseen Dimensions of Housing Question in Turkey The Case of TOKİ-İstanbul in Post-2000 Period

Emrah Altınok*

Abstract Housing investments in Turkey and İstanbul have demonstrated a significant increase over the last 10 years. The key player in this increase is Housing Development Administration of Turkey (TOKİ)1, a prime ministerial agency, producing and procuring housing projects for various income groups. With additional functions other than housing projects, TOKİ emerges as an institution directly steering the real estate market in metropolitan areas through its administrative privileges in sales of state properties, expropriation, land development and urban renewal. Despite the strong opposition to the projects due to their detrimental effects on social and ecological balances, TOKİ driven housing projects and accompanying mega infrastructure investments still serve as the one of the key resources for the politics of Justice and Development Party (AKP) which managed to hold the power since 2002.

In line with the fundamentally adopted macro-economic approach, TOKİ, emerging as a 'state apparatus' out of the transformation leading to institutionalization of neoliberal economy, is responsible for the regulation of the economy through real estate market after 2002. David Harvey’s Theory of Spatio-Temporal Fixes focusing on the relationship between capital shifts to real estate market as a result of over-accumulation crises (such as 2000-2001 crisis in Turkey) offers explanatory opportunities to analyze the internal variables of the housing phenomenon from a political economy standpoint. According to some other approaches, this phenomenon – in the form of social housing – has a function of redefining the consumption relationships, and besides curbing social contradictions in a modern capitalist society.

However, the so called social housing projects implemented by TOKİ are not actually affordable for the target audience to begin with, furthermore, the projects resulting in land transferred to the private investors essentially translates into a regime of accumulation and modes of regulation simply based on the uneven (re)distribution of wealth. Consequently, the very phenomenon is deepening the social contradictions rather than to appease. The urban space continues to disintegrate, particularly as a result of the mega projects and mass housing investments, in parallel with the ongoing decomposition of social relations and increasing distinction among social classes.

This paper, building on the results of the doctoral dissertation research completed in January 2012 and updated with current observations, primarily floodlights the historical transformation of the country's housing policies, followed by the scrutiny of housing projects implemented in İstanbul by TOKİ. In this sense, as well as general statistics on supply & demand, production & consumption capacities, the relationships between 'political rhetoric' and 'reality' are discussed. In the light of the findings, it has been concluded that a switch to a new housing and development model took place, presenting advantages and disadvantages for different social and political strata.

Keywords: Housing Development Administration of Turkey (HDA / TOKI), 2000-2001 crisis, Post 2000 Period, Theory of Spatio-Temporal Fixes, Accumulation by Dispossession, State-led Dispossession, Displacement, Loan Dependent Housing Market, Indebtedness, Stability of Economy.

* Emrah Altınok, PhD [Asst. Prof.] Department of Architecture, Faculty of Architecture, İstanbul Bilgi University, Eyüp, İstanbul, Turkey.

e-mail: [email protected]

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Emrah Altınok "To have or not to have, that is the question: The Unseen Dimensions of Housing Question in Turkey, The Case of TOKİ-İstanbul in Post-2000 Period", The Housing Question - Nomad Seminar, University of San Diego, March 12-13, 2015

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Introduction

Aim of the Research

This paper, which I included the findings of my 3 year long PhD thesis2 completed in January 2012, and enriched with up-to-date data, is boldly aimed to clarify the unseen dimensions of housing problem, as promised in the title, motivated by two different drivers. First one is my confidence that an empirical-objective approach to urbanization and housing issue guided by a well engineered research question is possible and rational results can be obtained this way. The second one is my belief that critical urban theory will enable me to explore underlying mechanisms rather than what is seen on the surface. I examined the post 2000 Istanbul with such a motivation. I took on a mission to explain what causes the infestation of giant blocks of concrete all over Istanbul in the light of urban political economy; or in other words, I wanted to discover the hallmark of the events.

‘What is so special about housing production in Turkey and in Istanbul particularly in the post 2000 period?' There is a rather simple answer to this question: Rapid growth in the real estate market and the Housing Development Administration of Turkey (Toplu Konut İdaresi - TOKİ).

Although founded in 1984, TOKİ enjoyed vast expansion of its powers in this period (2003 - 2010), the organization was transformed into a government agency with dozens of legislations enacted, steering the housing production and overall urbanization practice through its planning privileges, TOKİ carved its mark on the 2000s. TOKİ is, almost without exception, the implementing instrument for the ‘mega-projects’ (or 'crazy projects' as the AKP prefers to call them) proposed for Istanbul by the governing political power, Justice and Development Party (AKP). TOKİ's preferential engagement in prestige projects which are sort of forcibly integrated into the city in a fervent global city discourse and public housing projects developed in this way, perpetuating the uncontrolled growth of the city even defying the ecological threshold on the north of the city, deepening the dire conditions of poor through transformation projects, renders the main function of the Administration in the housing industry questionable.

Focus

Adopting a selective attitude to examine the important and seemingly complex dimensions of the issue is crucial for a clear identification of the focus and extent of the research. Referring 'over urbanization' as the main problem in terms of such a research would not be surprising. However, in order to be able to build specific hypotheses on housing, based on such a main problem, the parties (or players) involved in the process should be identified.

We already noted the rapid growth in the housing market and changing role of TOKİ as the conditions that make the post 2000 period unique. Therefore, 'housing market' and 'state' (TOKİ as an agency directly under the organization of the Prime Ministry) are two key aspects of the subject. Considering the rapidly increasing investments and the role of TOKİ, the question comes to mind, is it the state that sets the course, or is it the capital? On the other side, there is the 'society' which is usually described as the 'object', but not a ‘player’ in the process. This essentially

2 For the original thesis paper in Turkish language, refer to; The Political Economy of Reorganization of Urban Space and Interventions on Urban Land Tenure, the Case of Istanbul-TOKİ in Post-2000 Era. PhD Thesis. Department of City and Regional Planning, Yildiz Technical University, Istanbul.

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falls into the third category of unseen parties in the process. Literature on the subject, highlights one of these three, usually for the first two, as having a dominant role.3

So, how to examine the issue in the TOKİ example? What should be the source of our theoretical framework? Here again, we see three main theoretical paths: capital accumulation (economy), government policy (political science), social & spatial dynamics (sociology, anthropology, geography).

Growth in the housing market and the fact that the market is driven by TOKİ, inevitably pushes the research to the 'economy' aspect. In such a setting, it is strongly probable to examine TOKİ regulations, as government’s ice breaking interventions cutting through the bottlenecks in capital accumulation processes. However, the risk here is the explanation will exclusively be built around arguments derived from capital accumulation relations, crisis or speculative 'bubble' theories.

Another approach is to examine housing production as a 'political tool'. Authors in this lane of the discussion will try to investigate how and why TOKİ emerged as a state apparatus responsible for housing production, and the political functions of the state apparatus against the backdrop of the changing role of the state and public administration. Here, too, we can be swayed to the idea that all reflexes in the housing market pioneered by TOKİ are mere outcomes of populist politics developed by the government to remain in power; in other words, there is the risk of depicting the process completely independent from the capital accumulation or crisis cycles.

In the third approach, where the issue is to be examined on 'socio-spatial dynamics' axis, it can be said that some authors will tend to discuss the housing problem over urban geography and living conditions. These authors will focus on the unwelcome consequences of TOKİ driven housing market on different social groups and the urban geography. Some other authors in the same group on the other hand will prefer not to regard the society as an ‘affected object’ in the urban processes steered by economic and political dynamics and claim that social trends and expectations are actually the factors that shape the market and the housing production. Here, it can be deduced that the first group of authors are more interested in the impact of the problem on the society and the city, rather than the source of it, while the second group conclude that trends and expectations of the communities preset the urban processes (or in other words, the society is actually blamed of urban problems).

An overview of the current theoretical trends in the field of urban studies in general, rather than a specific focus on the TOKİ example in the post 2000 period, reveals that the housing problem is indeed often addressed exclusively through a single one of these basic approaches. So, is it possible not to regard these three aspects as categories separated from each other by distinct boundaries?

Henri Lefebvre, who started the groundbreaking discussions in critical urban theory in the 1970s, regarded urban space as a setting where all these structures and processes are closely intertwined. In his book "The Production of Space" (1991[1974]) the author cautions not to reduce the space and the production of the space into the limits of any of these three settings or to a infrastructure-superstructure debate. According to Lefebvre, these existing components, aspects

3 For a study addressing the question whether or not it is possible to talk about a key logic or player that drives the urban processes and how approaches studying these differ from each other, refer to Şengül, 2009 (original text in Turkish). According to the author, three basic logics are key in urban paradox and change; 'social classes', 'capital accumulation process' and 'state'.

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and actors displayed intertwined mobility and it was not possible to identify a single logic that acts the one and only determinant in urban change.4

This is also the case in terms of sources of theory on the matter. In his work "Urban Revolution" (2003[1970]) Lefebvre argues that 'fragmentary sciences' fail to investigate the urban phenomenon comprehensively and defines urban studies as a field struggling with integrity problems and collecting the residue left unexplained by these disciplines (p.47- 76). Moreover, it is not possible to explore the subjects in its entirety through the fragmented explanations the disciplines bring forward, because “fragments do not constitute knowledge" (2003: 49). According to him, what needs to be done is to walk out of the 'blind field' that keeps us from seeing the city reality as is, define the 'virtual object' - the urban society and observe the reality through a 'possible-impossible' that transcends it. The reality of the city can be understood through that perspective, which then should be followed by abandoning phenomenology for analysis and logic for dialectics in order to reach the 'differential' (2003: 47).

Today, in the field of urban studies, we still cannot be deemed to have surpassed beyond Lefebvre’s (albeit a bit pessimistic) fragmentary sciences paradox (or integrity issue). However, thanks to Lefebvre’s revolutionary perspective (with his standpoint of viewing today though the virtual that enables him to foresee the urban revolution) we can say that critical urban theory has gone a long way to shed light on the blind field. What makes it possible is 'dialectical method' rather than the ‘impossibly comprehensive approaches' or 'reductionist models'. Dialectical method enables us to analyze the intertwined complex components (in our example, the logic of capital, the logic of state and social processes), see beyond the superficial and reach the underlying mechanisms to reveal the unseen.

Hypotheses & Methodology

The theoretical sources that this study pillars on are identified to address the four basic explanation needs mandated by the research questions as listed below.

1 How can TOKİ be positioned as a state apparatus in the institutionalization of neoliberalism and transformation of the state?

BURNHAM, P. Depoliticization of Economic Management

2 How can the state - capital (TOKİ - housing market) relationship be explained?

AGLIETTA, M. & REGULATION SCHOOL Theory of Capitalist Regulation

HARVEY, D. Structured Coherence

3 How can the housing market growth in the period after 2003 be explained?

HARVEY, D. Theory of Spatio-Temporal Fixes

4 How should the interventions on urban land tenure by TOKİ legislations (state-led dispossession) be explained?

HARVEY, D. Accumulation by Dispossession Thesis

4 There are considerable works evaluating the urban processes in conjunction with economic, social and political parameters and regarding the impact of these factors equal. For some of them, refer to; Leitner, 1989; Gooby, 1997; Kodras, 2001; Pillay, 2003; Lin, 2008; Redwood, 2010.

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Accordingly, based on the perspectives imposed by the theoretical background, the research process was designed over the following assumptions:

[1] With its redefined functions and extended regulatory powers in the post 2000 period, TOKİ, emerges as a regulatory state apparatus (exempted from audit) facilitating real estate investments regarded by the capital in search of 'spatio-temporal fixes' as opportunity to overcome the over-accumulation crisis.

[2] Accordingly, it should be expected that ‘Accumulation by Dispossession' thesis which is complementary to Harvey's spatio-temporal fixes theory should also be applicable for TOKİ investments in Istanbul, often times the implemented projects are in essence marketization of public assets; and as a result, majority such projects are implemented on public lands.5

[3] By essentially interfering with the urban ownership structure, TOKİ run projects create inequality in redistribution of wealth.

Theoretical Framework: An Urban Political Economy Approach

Marxist Political Economy and Regulation School for Explaining Crisis and State-Capital Relationship

Marx puts forward satisfactory explanations for both the reasons of the emergence of capital accumulation crises and the various interventions put in action in overcoming such crises. According to Marx (1982 [1890]), state plays a very important role in the relations of production (infrastructure) and building and sustaining the cultural and institutional structures necessary for the continuation of the order (superstructure); as the capitalist state is an extension of the ruling class (the bourgeoisie) which controls the surplus labor.6 In the event of arrangements failing to generate satisfactory results within the national borders, the state engages in the international imperialist attacks creating new markets and cheap labor opportunities for capital.

It can be said that, to date all perspectives categorized under the literature of Marxist political economy have mainly adopted 'the theory of tendency of the rate of profit to fall'. However, the main differentiation manifests itself in the assertion that the crises occurred after Marx, have their unique dimensions.

Different fractions suggest different explanations in that matter. For example, Regulation School is one of the schools of thought that build such explanations. It is one of the few Marxist schools studying various historical stages of capitalist development (Brenner and Glick, 1991: 46). However, the main difference of the school separating it from others7 is that their explanations

5 Such investments may also involve the ownership of private lands. Similarly, at the periphery, slum neighborhoods are utilized as substrates for these investments. In that case, TOKİ has to interfere with the land tenure structures in these locations to ensure the transfer of ownership of large investors.

6 Hay (2006) underlines that the state has three main functions from the perspective of Marxist theory: The repressive arm of the bourgeoisie, an instrument of the ruling class and a factor of cohesion within the social formation.

7 Growth machine -or growth coalitions - theory is one of structuralist urban politics theories which focuses on the relationship between politics and economics. It discusses the unchanging partnership of political agenda and private investor decisions and the dominance of such partnerships. However, the model is criticized by some authors as it is mostly based on local governments experience in the US, failure of its arguments in explaining the variation of government policies and its tendency to overlook other social forces engaged in the process. For the theory and the criticism of its, see, Mollenkopf, 1994: 106; Harding, 1994: 679; Ley, 2009: 42-43.

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involve both state and the capital dimensions in combination, and further, defining the mismatch between these two as the root causes of crises.

The School earns a unique position in the literature by focusing on the over accumulation problem of the system and ability to reveal the extent of inequitable development through their analyses. After the downfall of Keynesianism in the 1970s, publication of "A Theory of Capitalist Regulation" by Michael Aglietta in 1979 followed by many other French economists contributing to the literature with their works built around similar arguments is seen as the emergence of the French Regulation School (Clarke, 1988: 60).

According to the School, history of capitalism is based on the changes of 'regimes of accumulation' and 'modes of regulation'. The resulting crises are explained by the mismatches between these regimes and modes of regulation. For the case of TOKİ – Turkey, the mode of regulation is of particular significance.

The set of organizational forms, relationships and rules mandating the acts of economic units in order to ensure the necessary concordance between the current regime of accumulation and social relations is called mode of regulation. Mode of regulation harmonizes the often contradicting acts of economic units, reregulates and controls the existing accumulation relations and reproduces the fundamental social relationships. Accordingly, when the development of a new regime of accumulation is hindered by the obsolete mode of regulation or when the current accumulation regime reaches to the limits of its potential, structural crises emerge (Taymaz, 1993: 18-19).

Having his unique place among the Regulation School theorists, Bob Jessop criticizes some commonly held and deep-seated explanations of the school. For example, he incorporates David Harvey’s spatio-temporal fixes and structured coherence concepts, which are much more complex and sophisticated, to his explanations while the school tries to fit them in 'mismatches between regime of accumulation and mode of regulation' explanations.8 Internationalization as one of the main determinants and root causes of crises can be seen as the main reason why Jessop's embraces these concepts. Because internationalization led way to the increased demands to be met overseas rather than within a nation. In that sense, Keynesian domestic focused welfare state mode of regulation created a territorial divergence9 which in turn deepened the crisis.

The Political Economy of Reorganization of Urban Space

The explanations of Regulation School and other theoretical sources the School rely on (e.g. 'Kondratief waves' and Mandel's theory of Long Waves of Capitalist Development) shows us that capitalism is prone to go under periodic crises. More recent studies also mention about the connection between over accumulation and the crises. Harvey's work (2003) is most prominent of these studies. Although Marx has also referred to underconsumption he gave attached importance to over accumulation, Harvey followed the footsteps of Marx who first discovered it, as well as Brenner (2002) who showed that the crises of the last century were over accumulation crises.

8 In his recent studies, Jessop indeed gives these concepts a central role in the explanations. He criticizes Harvey's views through several standpoints and attempts to add new functions to them. (For further examination, see, Jessop, 2002; 2003; 2004a; 2004b).

9 “Territorial Divergence” definition belongs to Robin Murray (1975). Murray points to the multinational companies increase their investments in different locations / territories in parallel with the internationalization of capital and states that this is causing a mismatch as the spatial organization jurisdiction of the state is limited with boundaries of the nation.

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According to Harvey, over accumulation has two main components. The first is the capital surplus, which can be in the form of goods, money or idle productive capacities. The second component is surplus of labor power.

The first major crisis caused by capitalist over accumulation was the economic collapse of 1846 - 1850 which gave rise to the bourgeois revolutionary movement all over Europe. Long-term infrastructure investments and the geographic expansion especially focusing on the Atlantic trade can be seen as the solutions employed to overcome this first capitalist crisis (Harvey, 2003: 42-43).

Accordingly, in the process of capitalist development, the geographic mobility of capital and re-organization of the urban space can said to take place in the wake of each of the cyclical crises. However, this process should be examined as part of an organization based on the revision and harmonization of the system rather than a mere spatial intervention.

Seven basic mechanisms, interconnection of which is almost impossible to solve today, are engaged in the construction of this harmony. These are, namely, the political structure (government), the military system, the law enforcement system, legal system, monetary system, property system, transportation-communication system and system of values.10 Consequently, although the economic exchanges employed in building the structured coherence appear to be the main driver, reconstruction of system of values is also a part of this process (Harvey, 2003: 102-103).

Still, examining the structured coherence to be mostly the establishment of neoliberal financial relationships would not be too inaccurate. Policies imposed through international financial instruments, such as the IMF and the World Bank, functions as the tools to ensure neoliberalism is adopted as common model in peripheral countries as well. On the other hand, it should be noted that such organizational interventions provide ease of movement also for the domestic capital making investments within national borders, just as internationalized capital.

Circuits of Capital and the Theory of Spatio-Temporal Fixes

According to Lefebvre, real estate functions as a second sector, a circuit that runs parallel to that of industrial production, which serves the nondurable assets market, or at least those that are less durable than buildings. This second sector serves as a buffer. It is where capital flows in the event of a depression (Lefebvre, 2003 [1970]: 159).

Following mostly Lefebvre in his theses, Harvey in his 1981 paper “The Spatial Fix—Hegel, Von Thunen and Marx” published in Antipode puts forward a similar view. Harvey then expands these views with the "3 basic cycles of capital" he defines in his work "Urbanization of Capital" (1985) and incorporates that approach with minor changes, in many studies thereafter. Spatio-Temporal Fixes Theory takes its latest form in his work “The New Imperialism” published in 2003.11

According to Harvey (2003: 109-115), capitalism has been experiencing over accumulation problems especially in the post 1970 period. Geographical expansion / temporal or spatial displacement are the solutions employed in the crises which are particularly driven by such problems. Accordingly, projects that reorganize the urban space (real estate and infrastructure

10 This proposition resembles the "mismatches between regime of accumulation and mode of regulation" based crisis definition put forward by the Regulation School. For structural coherence mechanisms, see, Harvey, 2003: 89, 102, 200.

11 This theory had a considerable impact on the literature. For noteworthy studies, see. Herod, 1997; Arrighi, 2004; Jessop, 2003; 2004a; 2004b; Wyly, 2004; Cerny, 2006; Glasman, 2007; Merk, 2009.

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investments) become particularly prevalent at times of crisis. In this way, capital surplus is territorialized, i.e. fixed on land.

This process has two main components. The first is the 'spatial fixes' creating opportunities for new markets, new production capacities, and new resource, social, and labor possibilities elsewhere. The second type, the 'temporal fixes', ensure temporal displacement of over accumulation through investment in long-term capital projects or social expenditures (such as education and research) (Harvey, 2003: 109).

Having these features, spatio-temporal fixes become parts of a periodical movement, that can be defined by three main cycles:12

Primary circuit: Realm of immediate production and consumption

Secondary circuit (or spatial fixes): built environment of production (factories, plants etc.), built environment of consumption (housing etc.) and technical infrastructure investments aimed to increase the efficiency of these two components (motorways, railways, airports, ports, water, sewer, electricity etc.); or in summary the production of urban space

Tertiary circuit (or temporal fixes): Investments related to technology, science, management and social expenditures (education, health, welfare, ideology, police, military, etc.)

According to Harvey, when the basic economic mechanism driving the production and consumption dynamics (the primary circuit) comes to a halt, the capital moves into the field of production of urban space (spatial fixes). Capital also attempts to postpone the over accumulation crisis by investing in social and cultural fields (temporal fixes). Usually, these two processes run together (spatio-temporal fixes) providing long-term benefits to the capital. In any case, the investment is gaining a spatial-geographical nature.

It should be particularly noted that such activity of capital is taking place across uneven geographical conditions on a global scale. Accordingly, the capital constantly attempts to exploit such spatial asymmetries to its own use, taking advantage of the unique benefits offered by different geographies. In every opportunity, capital relocates to geographies presenting advantages that can be converted into profitable investments. If the options for such geographies are limited or relocation to distant spots is not profitable, the capital creates these advantages on its own by reorganizing the space. In such cases, the capital re-organizes the space with large scale infrastructure projects that will bring high profits in the long run, even to the extent such action may require defiance of unique traits of such geographical space, if necessary. Harvey (2003:89) identifies prior accomplishment of structural coherence in the investment geography as the one and only preliminary condition that ensures this movement, the molecular movements of capital accumulation in space and time as he calls it, is carried out without interruption or obstruction.

The conclusion to be drawn here is; space is key to overcoming all over-accumulation crisis, however, merely on its own value of use, the space has no particular significance for the capital. The space only gains real value if reorganized in line with the needs of capital. At this point, state mechanisms and all other mechanisms involved in such reorganization of the space, come into play. Use value is transformed into exchange value, absolute ground rent is transformed into differential ground rent. Raw land becomes improved land and developed plot. All these

12 ibid, p109.

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mechanisms take place in the broad sense of the pool of regulation. We call this process 'reorganization of space'. In the following chapters, we will discuss the specific aspects of this process, In the specific example of TOKİ-Turkey-Istanbul.

Accumulation by Dispossession

In the capitalist system, space is handled as any of the limited resources as its own advantages and resources are gradually depleted like any other. This resources is consumed continuously in process as a result of the acts of capital in search of spatial fixes.13 Capitalist market can not be contained and it is in need of constant expansion.14

The actions of capital facing a crisis of over accumulation is not limited searching different areas of investment. According to Harvey (2003: 143), capitalist system is essentially in need of 'a fund of assets outside of itself'. At this point, public assets become the resort and commodification of these assets take place. So, new assets (assets outside of the capital itself) which were not available for the capital are introduced in the system.

Dispossession strategy developed by the bourgeoisie, the primitive accumulation as defined by Marx (indeed Marx calls it theft) is the basis of Harvey’s accumulation by dispossession definition. Privatization of profitable public institutions, confiscation public land to be used for private investments are seen as the simplest forms of dispossession. It can also be alternatively defined as 'enclosing the commons’15 or ‘redistribution of assets that increasingly favored the upper classes’.16 Forced migration of common property rights (such as pension rights, welfare rights, health insurance rights) acquired through years relentless class struggles into the private sphere is the bare seizure policy of neoliberal system.

Since the essence of the accumulation by dispossession is transforming the common, collective and state ownership rights to exclusively private property rights, it should be noted that the natural resources also get their fair share of that plunder.17. Holding the monopoly of legitimate use of violence and decision making, the state plays a supporting role in this process (Harvey, 2003: 145).

At this point, some observations should be made on neoliberalism and the transformation of the state, before taking a look at all these processes in the case of Turkey.

13 The concept of creative destruction that Schumpeter's derived out of the Marxist theory can be reconsidered here. Although Harvey used the concept in structured coherence debate, the concept suggests the capital has the ability to reorganize the same space many times. The codes of a particular space becoming obsolete can always be rewritten. When viewed this way, it is not possible to consider space as a limited resource. Indeed, the capital appears to be capable of creating new codes to replace obsolete ones in a particular space and transform any space into a profitable investment anytime it desires. But in fact this is not very likely. Codes of profitability phase out leaving behind destruction and devaluation after the capital flight and a revival is extremely costly. On the other hand, there are still geographies on the sphere that are not yet discovered by the capital; in fact it can be said that such locations are relatively abundant.

14 Because the spatio-temporal fixes suffer devaluation through 'over investment' or 'capacity surplus' which in turn give rise to new crisis.

15 ibid, p148.

16 ibid, p159.

17 Roy (2001) defines privatization as transfer of all productive public assets (land, forests, water, air, etc.) to the private sector.

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Institutionalization of Neoliberalism and Transformation of the State in the Post-2000 period

According to Burnham (2000), most theories dealing with globalization fail to conceptualize the state-market relationship satisfactorily, as they tend to regard these state and market as isolated and opposing components of social reality. As a result, arguments emerge; "state lost its power to the market" or "the state vanished". In fact, the state is not disappearing, it is transforming (Cox, 1987). Historically, the state functions as a shield protecting national economies from destructive foreign powers and to ensure local prosperity and employment. After 1973, this mission transformed into ensuring the adaption of local economies to meet the needs of global economy.

During and after the 1980s this change in the role of the state led to the commercialization of numerous basic public services such as social security, healthcare, education; elimination of the historical achievements of the working class such as labor laws, unions, social services/benefits.18 As the governmental instruments such as Ministry of Labor, Ministry of Social Security, Ministry of Industry and Planning which were organizations in connection with the social structure of the past weakened; financial instruments like Treasury, Ministry of Finance, Central Bank and the Prime Ministry gained importance.19

Examining the case in the light of Burnham’s arguments, in order to ensure financial functioning of the neoliberal system, the trust of the capital must be earned at a national scale. Such environment of trust can only be achieved through the "Depoliticization of Economic Management". For that purpose, central banks must be made autonomous, revenue administration must be rendered semi-autonomous and a number of "new independent regulatory agencies" must be created (Burnham, 2000). According to Güzelsarı (2007), establishment of new independent regulatory devices, in fact means creation of financial apparatus beyond the control of the governing authority.20

The state shrinking and stepping out of the economic activities in the early stages of neoliberalism during the 1980-2000 period, has been transformed since 2000s into a engaging and active market-friendly entity, implementing regulatory reforms to ensure financial discipline in the market and even taking place in the market as a player.

In the case of TOKİ, it is possible to regard the Administration as a depoliticized independent regulatory apparatus, used to walk around the auditory processes and to regulate the economy leveraging on the real estate market. On the other hand, we know that TOKİ is also used a tool for populism, particularly employed in the pre-election atmosphere, which is another indicator that enables us to regard it as seemingly depoliticized, yet highly powerful agency working towards strictly political goals.

18 It should be noted that it is possible to regard this process to be associated with both structured coherence and accumulation by dispossession.

19 For an original doctoral research on this subject bringing together the views of Leo Panitch (1994; 2004) and Robert Cox (1987) see, Güzelsarı, 2007 (Original in Turkish).

20 This organizational approach particularly finding a place for itself under the "new constitutionalism", unburdened the economic agencies of accountability.

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Phases of housing development in Turkey-Istanbul

Until the 1980s cities in Turkey are urban spaces where white-collar employees constituting the majority of middle-class tend to solve the housing problems on their own through independent constractors (yap-sat21) and housing coops while blue-collar population mostly preferring squatter housing (gecekondu22) in the peripheral slums. Although the progressive vision of 1960 Constitution led the way to the earliest state subsidized housing initiatives as a solution the housing problem in the city, along with the institutionalization of the urban planning, these efforts are far from being a solution to the housing problem. During this period, Istanbul goes under an identity transformation with the construction the first such bridge on Bosporus and E5 highway23. Industrial properties and slum areas providing the required labor started to develop along the E5. The city with the prevalent development trends along the Bosporus coastline until that time, starts to grow around a major transport corridor and to expand towards the north; compared with the growth to be observed in the future periods, this expansion is fairly 'benign' (see. Figure 1 and Table 1).

The period between 1980-2000 is a phase where 'innocent' one or two story slums are legitimized through 'amnesties' and turn into apartment complexes thanks to the 'slum improvement plans' (or ıslah imar planları) while the middle class continued their own urbanization through housing coops. From its establishment in 1984 to the 2000s, TOKİ operated as an agency responsible of financing of these housing coops.24 1980s is seen a period in which urban land is transformed into a means of capital accumulation - again enabled by the policies of a right wing party - for the first time in Turkey.25 Istanbul has continued to grow rapidly in intermittent sprawls (see. Figure 2). The urbanization model of the period is an extremely 'aggressive' suburbanization. Driven by the district municipalities (belde belediyeleri) with numbers multiplied up to 5-6 times compared to previous periods and furnished with the powers to prepare development plans, illegal urban development gained momentum and while its character was also transformed in the process.26 Likewise, the characteristics of housing projects constructed in this period significantly differ from the past, the movement of upper-middle and upper income groups out of the city and settling in gated communities has become the hallmark of the period.

21 'Yap-sat' (Turkish for 'build and sell'): The scarcity of urban land in the parts of the city with completed zoning plans and the pressure of need for more housing in the face of a growing population coupled with skyrocketing land values created another form of improvised housing production (Enlil, 2011).

22 ‘Gecekondu’ (Turkish for 'built overnight'): In Turkey example, poor quality unlicensed housing produced by low income workers settling in the big cities as a result of intensive migration waves, usually on state owned lands. In this period, the state could not allocate funds to any other area but industrialization, abandoning the land to the slums. This was a preference reducing the cost of urbanization as well as reducing pays of the workers (value of socially-necessary labor) as they were not under rent or mortgage liabilities. The domestic consumption required to ensure economic stability in the import substitution period, was made possible through the participation of the population relocating in the cities in the consumption.

23 For a comprehensive work on historical change of Istanbul's urban form, see, Enlil, 2011.

24 According to Geray (2010), the coops which essentially can be considered as non-governmental organizations that rely on TOKİ for their development demonstrate a development that is actually a successful model that enables lower-middle and middle class invest their small savings. However, in the post-2003 period, TOKİ completely lost that its lender character funding coops via loans.

25 Production of space was not yet a profitable business for the capital owners who were engaged in the commodity production business in the past. The slum dwellers was trying to hold on to the city. During this period, the first wave of immigrants took advantage of being the pioneers, traded up to apartment buildings erected in the land occupied by their makeshift houses. Later on, capital owners too got on board with this movement of construction of apartment buildings.

26 'Hisseli Tapu' - shared deed ownership (or unauthorized subdivisions of property) is the product of this development phase, which can be summarized as agricultural lands divided into lots and sold by land mafia followed by the construction of housing on such lots.

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Figure 1. Sprawl of industrial and residential areas in Istanbul during 1950–1980

Source: Enlil, 2011 cited from Kaptan, 1991

Figure 2. Urban sprawl in Istanbul from 1987 to 1999

Source: Altınok & Cengiz, 2008 cited from Kalkan, S., Çetiz, S., Akay, Z., 2004

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Table 1. Phases of housing in Turkey and in Istanbul (1950-2015)

1950-1980 URBAN GROWTH [Densification in the old city center] + [Fine grain sized - low density expansion patterns]

'Planned unplannedness' Major transport investments [E5 highway - First bridge crossing on Bosporus] Domestic market oriented industrialization movement [linear industrial development alongside the E5 highway] First phase of illegal urban development: 'Innocent Squatters' Populist policies and social legitimization of squatter development [Slums alongside E5 and Golden Horn: Zeytinburnu,

Üsküdar, Gültepe, Çeliktepe, Kuştepe, Çağlayan, Paşabahçe, Fikirtepe, Güngören etc.]

Condominium Ownership Act and Urbanization Strategy of the Middle Class Coalition of non-homeowners: 'Housing Coops' Land owner - Constructor coalition: 'Yap-sat' (Build & Sell) development model

'Benign (sub)urbanization' [First Generation] First public housing initiatives [Levent, Koşuyolu, Ataköy etc.] Blue collar housing initiatives - 'affordable homes' [Zeytinburnu, Koşuyolu etc.] 1960 Constitution and social housing initiatives in the planned development era [Ministry of Development and Housing,

social housing projects in slum prevention zones: Tozkoparan, Ataşehir İmar İskân Housing Project etc.]

1980-2000 URBAN SPRAWL [Densification in the centralizing periphery] + [Medium grain sized - medium density expansion patterns] [Scattered development / Short intermittent leapfrogging] + [Early socio-spatial segregation]

‘Condo-slums’ Political clientelism and political legitimization of squatter development [Amnesties and slum improvement plans] From use value to exchange value - 'Innocent Squatters' turn into apartment buildings [Çeliktepe, Gültepe, Ümraniye etc.]

'Untamed (sub)urbanization' [Second Generation] Major transport investments [TEM highway – Second bridge crossing over Bosporus, T1 streetcar line, M2 subway line] Decentralization of industry [İkitelli, Tuzla and Dudullu Organized Industrial Zones] District municipalities - 'Belde Belediyeleri' Slum improvement plans - 'Islah İmar Planları' Second phase of illegal development - 'Hisseli Tapu' (shared deed ownership) [Pendik, Şeyhli etc.]

Gated community model in public housing [Bahçeşehir and Halkalı Atakent examples]

Upper class leaving the center First generation gated communities [Göktürk, Kemer Country, Acarkent examples]

2000-2015 (GOVERNMENT DRIVEN) OVER-URBANIZATION [Densification in both the center and periphery ] + [Coarse grain sized - high density expansion patterns] [Leapfrog development through massive footprints] [Social segregation] + [Spatial fragmentation]

'Unplanned Planning' 1999 Earthquake Effect [Avcılar-Büyükçekmece examples]

2000-2001 Economic Crisis Major transport investments [Marmaray, F1 funicular line, M2, M3, M4 subway lines, T4 streetcar line, Northern Marmara Motorway,

3rd Bridge Crossing, 3rd Airport, Kanalistanbul, Avrasya Tunnel etc.] 'Housing campaign' and TOKİ

'Monstrous (sub)urbanization' [Third Generation] 'City Inside The City': TOKİ projects [Kayaşehir, Ataşehir] Real Estate Investment Trusts (GYOs-REITs) [Simpaş GYO, Emlak GYO, Torunlar GYO etc.] Legitimization of Development on Irreclaimable Forest Areas (2B areas) [Çavuşbaşı example] Illegal suburban residences [Sarıyer example]

Middle and Upper Class Creating Its Own Center/Claiming Both the Center and the Periphery Gated Communities [Bosporus City example] Mixed use development [Residence-Mall-Hotel; 'Mall of Istanbul' example] Gentrification [Tarlabaşı, Sulukule etc.] Disaster Law and Urban Transformation Movement [Fikirtepe example] 'Yenişehir' project

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2000-2001 Crisis and Background of the Reconstruction

The transformation starting to emerge in the 1980-2000 period geared up after 2000 with increased impact. Especially in Istanbul, urbanization gained momentum and never before seen intensity in the wake of 1999 Marmara Earthquake and the devastating effects of the economic crisis of 2000-2001. Given the urbanization expanding into the invaluable ecological zones in the north, continuously spreading over the existing stain, as well as densification in the center, it can rather be called 'monstrous (sub)urbanization' instead of over-urbanization. Propelled by dozens of new transportation projects,27 ecological thresholds, forests and agricultural lands, watersheds, and all poor neighborhoods around the city turned into investment sites for large scale residential projects; and the trend still continues.

2000-2001 crisis was the harbinger of a major transformation for Turkey, leading to not only economic, but also political, legal, social and even cultural transformation. Crisis was a failure story for the government of the time and served as an 'opportunity' to reset and re-establish the system by the conservative Islamist AKP government taking power in November 2002 elections28.

Crisis was so effective that the strong and well established political parties of the era (ANAP, DYP and DSP) were completely wiped out. In fact, "weak coalition governments" in the 1991-2002 period were regarded as obstacles to Turkey’s economic development by the World Bank (Bademci, 2007).

The AKP government has remained in power since November 2002 (about 13 years), among all the other governing parties to take the power since 1980, AKP managed to become the first political power to systematically implement all structural adjustment processes Harvey mentioned (political, economic, legal, social and military systems), from head to toe. Housing policy was developed concurrently with this structural transformation. Immediately after the election, the government launched and 'Emergency Action Plan'. The plan featured a specific section under the title 'Housing Campaign'. In this context, housing production and planned urbanization were set as the main goals. Housing and urban renewal were also given impetus in January 2003. During the next four years, TOKİ's organizational structure was redesigned and its powers was expanded with new the regulatory actions. The Administration was taken under the organization of the Prime Ministry and was rendered an independent regulatory body generating its own resources. In time, Emlak Bank, the organization once operated in the loans for mass housing business and the General Directorate of Land Development (Arsa Ofisi) was also incorporated into TOKİ’s organization even expanding the land portfolio of the Administration.

By end of the year 2011 TOKİ - thanks to its new powers - was able to reach and even surpass the "500 thousand new housing units"29 goal specifically set by Prime Minister Recep Tayyip Erdoğan. This figure, as expressed on TOKİ's website, stands for "20 cities with a population of over a 100 thousand."

27 See, Table 1.

28 Conservatism is said to come to a bottleneck in the 1970s and could only rise up to its former glory with the neoliberalist movement. This paradigm (and also its so-called new form, neo-conservatism) becoming increasingly widespread in most of the state adopting the neoliberalist policies, gave the opportunity to governments to form alliances with both conservative groups and the liberal democrats.

29 These goal was originally set as 250 thousand (2003), then it was upgraded to 500 thousand, and it is constantly being increased, as 2011 it has reached 1 million housing units.

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Re-establishment of TOKİ and Real Estate Market as a Leverage to Regulate the Economy

We have already noted that TOKİ’s powers were greatly expanded after 2003 and the Administration ceased to be functioning as a loan provider.30 Taking advantage of these powers TOKİ has led over-accumulated capital to invest in the real estate market nationwide after the 2000-2001 crisis.

Predictably, post 2003 era appears as a special period in terms of housing production. An evaluation of Figure 3 reveals that the pre-crisis and post-conditions in housing production verify Harvey's thesis.

Figure 3. Housing Unit Production Per Thousand Population in Turkey

Source: TÜİK (TSI), Statistical Indicators 1923-2009, Publication No. 3493, Ankara.

The loan dependent housing market also displayed an expansion in the process (44 times increased loans compared to 1997-2003 period - See Figure 4).31 Unlike the previous period, these loans were extended by financial institutions, not by TOKİ. Consequently, banks have also generated significant interest income from these loans.

30 Some of the powers and privileges bestowed upon the Administration by the laws enacted (5398, Amended Laws 5403, 5609, 5162, 5335, 5366, 4856, 6306) between 2003-2010 include: transfer of state owned lands to the Administration with sole approval of Prime Minister, establishing companies, implementing profit oriented projects in order to raise income for the Administration, drafting and approving urban development plans, expropriation, slum (gecekondu) transformation projects, trading land for purposes other than housing (industry, education, health, tourism and so on), making deals with other state agencies including military in order to develop projects on lands owned by such agencies, renovation projects in preservation zones (renewal and regeneration projects in historical neighborhoods), exemption from audits of Superior Court of Auditors in financial matters, permanent land tax exemption and so on.

Some of the powers of the Administration has today can be attributed to the Mass Housing Act (Law No. 2985) that directly defines the responsibilities of Administration. However, some other powers used by the Administration are defined under "bag" amending several other laws in a single enactment which renders the limits and legitimacy of the practices of Administration questionable and presents a serious vagueness. For a review arguing that the referred ambiguity is particularly abused in slum transformations, see, Kuyucu 2014.

31 The chart indicates the total volume of housing loans extended between 1997-2003 is 1.9 billion TL and it rises up to 83.4 billion in the 2004-2009 period. In other words, the housing loan market took a full 44-fold leap in comparison.

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Figure 4. Yearly Distribution of Bank Loans for housing in Turkey

Source: Kalkınma Bakanlığı (Ministry of Development), (2011). Economic and Social Indicators, Section 8.

The housing production target set under the 'housing campaign’ launched by government as soon as they took the power was based on the grounds of 'housing shortage'. According to the government, there was a growing demand for housing in the country and the housing market was far from being capable to meet this demand. On the other hand, especially in academic circles, there were voices raising, that there wasn’t a housing shortage but in fact there was a 'housing surplus'. Examining the case in figures, reveals that there were about 2.7 million units housing surplus in Turkish cities as of 2000 (Altınok, 2012). However, since government based its housing shortage calculations not on entire housing stock but only buildingS with licenses and residential permits, it was not hard to create an illusion that there is an actual housing shortage.32

TOKİ still fends for the housing production on housing shortage discourse. These explanations involve arguments referring to the poor quality or illegality of the existing housing stock and thus they need to be renewed. However, how much of the housing produced so far were actually used to meet the housing needs of people living in the so called 'problematic' houses is questionable.33 If the hype is about a housing shortage and the main cause of this shortage is people living in 'problematic' housing, it should reasonably expected that the housing is primarily produced for that population. Otherwise, the system will constantly keep producing housing 'as an investment instrument' or 'a luxury object', resulting in people with no housing problems having their second, third residences while the social strata that is really in need of a quality housing will be deprived of a solution to their problem.

32 Accordingly, housing shortage is about 2.5 million units when only licensed housing units are taken into account, alternatively the figure is 6.4 million if residential structures with utilization permits only are taken as basis for calculations. For a more detailed examination, see, Altınok, 2012:105.

33 Numerical data on the subject for Istanbul example will be given in the next section.

40 69 47673

48 258805

2,713

12,966

15,604 15,535 15,360

21,223

0.0

5000.0

10000.0

15000.0

20000.0

25000.0

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Ban

k lo

ans

for

ho

usi

ng

(mili

on

TL)

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To Have or Not To Have, That is the Question

"…In this way the workers must shoulder heavy mortgage debts in order to obtain even these houses and thus they become completely the slaves of their employers; they are bound to their houses, they cannot go away, and they are

compelled to put up with whatever working conditions are offered them."

F. Engels, "The Housing Question" Note by F. Engels to the second German edition, 1887

To the working class - proletariat - who do not own the means of production, the capitalist system offers the dream of becoming a “homeowner”. There is a political economy notion and a social background behind this promise. We should take a deeper look at this topic.

For capital, existence of individuals willing to buy houses is a prerequisite for profitability. Furthermore, since this process heavily relies on 'fictitious capital' both for the investor and for the consumer, financial intermediaries can also profit in this business along with the investors. Given 'multiplier effect' of the construction industry, it can be said that making individuals become property owners, indeed creates a massive economic stimulus.

Production of 'affordable housing' has historically been the duty of the state, as these projects are not profitable for the capital, despite their low costs. In particular, in welfare state, production of 'social housing' by the state is in effect a measure to reduce the costs of manufacturer capital. Reduction of workers' accommodation and transport costs - due to the fact that social housing construction sites often fall within the proximity of manufacturing zones - decreases the average value of socially necessary labor. In this way, capital can enjoy short-term solutions to the problem of high labor costs.

Development of social or mass housing for both blue-collar and white-collar classes translates into a spatial organization where mass production meets the mass consumption.34 In addition, other 'collective consumption' areas offered along with the mass housing, play an important role in the reproduction of labor power and alleviation of social conflicts.35 In a system that encourages becoming property owner through legitimate paths, individuals are adapted to the system via the institutions of public consumption while they also become dependent on the system by borrowing.36 Thus, management and steering of a society composed of individuals adapted to and

34 The referred spatial organization includes mass consumption venues (such as shopping malls) and other necessary modernity functions (transport, education, health, socio-cultural services, recreation, etc.) necessary for the reproduction of labor.

35 Castells calls this entire organized process "collective consumption" (Castells, 1978).

36 "Ownership is in fact a complex bundle of rights, among which security of occupancy may or may not be provided" (Marcuse, 2012). However, people under loan liabilities can not be the owner of the property until the repayment is done completely. Property is mortgaged, and is actually owned by the lending institution. For example, in the wake of the 1999 Marmara earthquake the new so-called earthquake-resistant structures marketed in Istanbul, replaced the old structures, rendering the "former property owners” to “borrowers”. Slightest default in repayment will result the repossession of the mortgaged property. Consequently, individuals encouraged to become borrowers enticed by the "pay it back as you pay your rent" line, are in fact turned into tenants paying rent to the banks as the actual owners of their homes. Mortgage is a profitable area for financial institutions for purposes other than housing. This mechanism enabled the banks to expand their property inventory taking possession of various properties including urban lands, farmlands, houses and commercial properties in lieu of debts and reselling such properties at highly profitable rates. It is known that banks established "real estate departments" to manage the sales of repossessed properties. To see one of these news stories, see "Citizens go bankrupt, banks become real estate moguls." Radikal, 04/12/2011. http://goo.gl/KSJk4Y [Accessed February 25th, 2015]

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dependent on the system will be much easier; and political and economic stability will be ensured. This, in the long term, translates into the alleviation of social conflicts. Indebted individuals are fixed on the land for the sake of continuity of consumption and stability. Calling this "social consumption fix" would not be out of the line.

Unseen Dimensions of TOKİ-Led Housing Production in Istanbul

In addition to the data collected on the organizational structure and behavior models of TOKİ two spatial analyses of different scales was also included in the scope of this research. Istanbul metropolitan area was the sample of the large-scale analysis. In this scale, the features of projects implemented by TOKİ are assessed.37 District-scale explores the question of how TOKİ interferes with ownership structure in general. In this context, one of the sub-development zones characterized by a particular concentration of TOKİ projects in Istanbul was identified as the study area of the district-scale analysis. In this field study, data on property ownership and planning decisions were particularly evaluated.

How TOKİ runs its business?

Before taking an extensive look at TOKİ’s practices in Istanbul, it should be noted that all projects of the Administration in Turkey is contracted to private companies. In other words, TOKİ does not perform its projects directly using public resources. Therefore, it should be kept in mind that all of the projects we call 'TOKİ projects' are actually performed through a number of contractors.

The pattern of the process is usually acquisition and development of lands suited for the project to be erected, development of the zoning plans and piecewise contracting the various implementation stages within the zoning area. It should be stated that TOKİ adopts an approach involving production of large planning zones rather than project implementation on single lot. Coupled with additional capabilities, TOKİ appears as a planning authority which can act as landowner, land speculator,38 investor or developer that is even capable of regulate its own real estate market. In other words, TOKİ is an organization which can basically substitute for all players of the real estate market (like a chess piece with unlimited moves).39 An organization equipped with abilities of a private company and governed by corporate management practices as well as an apparatus directly working towards Prime Minister's political/ideological goals. This unusually hybrid design makes the Administration a unique actor.40

37 Considering the volume limits of this paper, a large portion of the data had to be excluded. For entire data, see. Altınok, 2012.

38 TOKİ is an agency that conducts production of land and keeping such lands under its proprietorship until such time they can be profitably disposed of. For more details, see Altınok, 2012: 205-211.

39 On the other hand, TOKİ is not the solo player in the market. There are seven government funded subsidiaries TOKİ collaborates with. Public share on the equity of government funded subsidiaries are 49%, therefore these are basically entities equipped with the rights and powers of private corporations. Emlak Real Estate Investment Trust (EKGYO) and Emlak Marketing Inc. corporate spin-offs of dissolved Emlak Bank are the two major partners of TOKİ in most of the projects.

40 Urban planning (or urbanism) actually redistributes the ownership and rent by reorganizing the space. Through urban planning new lands are added to the urban real estate market, which creates an absolute rent that was not previously existing. Once the land is decorated with development rights after the zoning plan a differential rent is also added on top of it. From a political-economy standpoint this is value created without any labor, or in other words it is value out of thin air. Therefore, how and by whom (by which ideology) this power of urbanism is exploited is extremely important. Exactly at this point, the hybrid character of TOKİ alienates the agency to its core purpose. Urban planning, supposedly adopting equitable principles to ensure the welfare of the society, is expected to relinquish this power back to the society. However, if this power is held by an agency governed in a

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Watersheds

Natural Reserves

RESIDENTIAL AREAS

Legally developed

Illegally developed

Current TOKİ Housing Areas

Non-residential

TOKİ LANDS

Ongoing Survey (to be purchased)

Acquired Areas

Ongoing Expropriation

Ongoing Construction

Urban Transformation

TOKİ and Government Driven Over-Urbanization in the Post 2000 Period

In Istanbul (see Figure 5, residential areas) one out of every four residential property (24.2%) is built on natural thresholds (forest, grassland, farmland, watersheds, etc.). Moreover, 64.1% of these buildings are on urban lands generated through planned development. A similar pattern can be seen in housing development on areas under geological risk. One out of every five house in Istanbul (20.4%) is built on geologically risky areas and three quarters of them (76.2%) are licensed (Istanbul Metropolitan Municipality, 2006: 154). This shows that, peripheral sprawls of Istanbul's growth actually took place legally and planned, i.e. not illegally unlike what may be imagined. The leading players of this peripheral development were once municipalities, and today it is TOKİ.

Figure 5 also shows the overall land under TOKİ’s control as of 2006. Yellow areas on the map are not yet acquired, but they are planned to be purchased by TOKİ (in 2006). A close analysis of Figures #5, #6, #7 and #8 together reveals that TOKİ started stockpiling land on the anticipated route of the 3rd Bosporus Bridge crossing and its roadway network, even before the existence of the project. Furthermore, the 'mega-projects' of the post-2012 period shown in Figure 7 (Project #1, #2, #3, #4 and #5) also coincide with TOKİ’s land assets, and projections as of 2006.

Figure 5. Natural thresholds and existing housing areas in Istanbul – 2006

Source: Altınok, E. (2012:359)

corporate manner, urban planning would inevitably turn into a 'profit machine'. Ground rent is distributed unequally between the players, which are supposedly in competition with each other in fair conditions.

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Figure 6. Natural thresholds and existing housing areas in Istanbul – 2011

Source: Altınok, E. (2012:360)

Figure 7. 'Yenişehir' Project and 'Mega Projects' in Istanbul 41 - 2015

Source: Istanbul Independent Architects Association, www.megaprojeleristanbul.com

41 'Yenişehir' projects related to the Ministry of Environment and Urbanization see some information in the website.

http://www.csb.gov.tr/gm/mpgm/index.php?Sayfa=haberdetay&Id=12975

Watersheds

Natural Reserves

RESIDENTIAL AREAS

Legally developed

Illegally developed

Current TOKİ Housing Areas

Non-residential

TOKİ LANDS

Ongoing Survey (to be purchased)

Acquired Areas

Ongoing Expropriation

Ongoing Construction

Urban Transformation

The 3rd airport project area

3rd Bosporus Bridge Crossing

Northern Marmara Motorway

Kanalistanbul

'Yenişehir ' project area

Other 'mega-projects'

1

2

3

6

4

5

1

2

3

4

5

6

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Figure 8 shows the Başakşehir-Avcılar-Küçükçekmece region where most of the TOKİ plans is concentrated. Each of the colored regions on the map exactly fits with boundaries of TOKİ approved development plans. Today, construction has already begun in these areas. The development zones entirely located on Küçükçekmece Watershed and fertile agricultural lands are estimated to bring in an additional population of roughly 1.5 million people. Also, re-examination of Figure 7, indicates that these areas have been incorporated in the Yenişehir Project in 2015. Here, it can be understood that this development was jointly planned way ahead by TOKİ and the government. The 'mega-projects' such as the 3rd Bosporus Bridge, its associated roadway network and the third airport, still under construction despite the public backlash, will cause the irrevocable destruction of invaluable forest areas and watersheds in the north of İstanbul. This is exactly the mind-boggling neo-liberal paradigm of urbanization in the post 2000 period.

Figure 8. Estimated additional population to be introduced in the Başakşehir-Avcılar-Küçükçekmece Region by TOKİ Development Areas - 2011

Source: Altınok, E. (2012:364)

TOTAL ADDITIONAL POPULATION:

1.500.000

P

P

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Does TOKİ Produce Social Housing?

TOKİ basically categorizes its housing projects as 'social housing' and 'resource development housing projects'.42 Projects in the social housing category is further divided into three subcategories by the Administration: Poor Group, Lower Income Group, narrow and Middle Income Group.43 In addition, a number of special types of projects are also included in the social housing classification by TOKİ: "Gecekondu Slum Transformation Projects", "Urban Renewal Projects", "Disaster Houses", "Immigrant Houses" and "Agriculture-Rural Applications". However, these project questionably qualify as social housing. For example, during the neighborhood renewal carried out at Fatih Sulukule, neigborhood was gentrified by driving the poor Romani population out of the district; furthermore the historical-cultural landscape was destroyed. The luxury residences built instead clearly do not qualify to be social housing.44 Nevertheless, the Administration persists to define the urban transformation projects as "social housing".

When urban renewal projects excluded from the classification of social housing projects implemented by the Administration in Istanbul until January 2012, it can be seen that 70% of the projects (87,920 units) are resource development housing projects, 22% (28,085 units) are social housing projects and 8% (9,828 units) are urban transformation projects (Altınok, 2012: 263). These results show that four out of every five housing unit constructed through TOKİ mechanisms are targeted for the upper income groups.45

Figure 9. Projects in Istanbul by TOKİ Classification

Source: Altınok, E. (2012:364)

42 TOKİ resource development housing projects (or profit orientied housing projects) are also business schemes based on Revenue Sharing or Revenue Sharing In lieu of Land. These projects involve the disposal of valuable land under the proprietorship of TOKİ or its affiliates (usually land acquired free of charge from the state) in favor of investors, based on the revenue sharing scheme for the total value estimated by the bidder. Usually, at the auction stage, the bidder to offer the highest revenue share is rewarded.

43 By this classification that is nothing like the usual classifications made by TSI and other international organizations, TOKİ seems to be defining low, low-middle and middle income groups. On the other hand, the criteria given on the Administration’s web page and taken as basis for the categorizations of income groups is not consistent in many ways. For more information see TOKİ, 2010, Konut Edinme Rehberi.

44 For two research projects conducted on Sulukule, see. İslam, T. & Sakızoğlu, B., 2015 and Uysal, Ü.E., 2012.

45 The distribution of these projects in Istanbul’s districts is plotted in Figure 10. Each district on the map is colored according to a "location coefficient" for the dominant class of housing projects implemented in the district by TOKİ. Statistically, the color represents the specialization of the district, or in other words the map shows which kind of projects are clustered in which districts. Accordingly, it can be seen that projects in the social housing category mostly appear in the peripheral districts, while prestigious residential projects are concentrated at the shore and districts in proximity of centers.

22%

70%

8%

Sosyal Konut Projeleri

Kaynak Geliştirme Konut Projeleri

Sınıflama Dışı: Dönüşüm Projeleri

Social Housing

Resource Development Housing (profit orientied)

Not classified: Urban Transformation / Neigborhood Renewal

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Figure 10. Distribution of TOKİ Housing Projects in Istanbul by TOKİ Classification

Source: Altınok, E. (2012:364)

Considering affordability the cost of housing units by low-income groups, it can be seen that transformation projects are not the only type of project that should be left out of social housing category. TOKİ promotes part of the housing units in project areas targeting high-income groups as housing for lower income groups. These units turn out to be 40-50 sqm studio apartments. Here, it can be said that the family size and loan repayments capacities of low-income households are not taken into account, hence it is possible to say that this is merely a misleading discourse. For this reason, income level classifications set forth by TOKİ need to be reconsidered. The lowest cost of housing units in the housing projects deemed to be within social housing category must be identified and it should be investigated whether or not such cost is within the limits of affordability by income groups. Table 2 summarizes this data for public housing projects in five examples.

The installment amounts shown in the table are determined according to best rates and repayment schemes offered by the bank among all mortgage loan issuing banks.46 UN Habitat II (1996) indicators was taken as basis for calculation of monthly income level with respect to the installment amount. Accordingly, the price of the housing unit should be higher than 5 times the annual income of the household, while the rent should not exceed 30% of the monthly income of the household.47 Based on the UN Habitat II indicators a new classification by monthly income was introduced.48

46 For loan calculations, see: www.kredipazari.com/public/main/apply7.php?view=summary (Accessed: 10/10/2011)

47 Ministry of Public Works and Housing, 2009: 33.

48 The results of a survey conducted on Istanbul was used in this classification. For details, see, Bölen, F. et al. 2006: 34, cited by the Ministry of Public Works and Housing, 2009.

Profit orientied housing

Social housing

Urban Renewal

Profit orientied housing

Social housing

Urban Renewal

1st location coefficient 2nd location coefficient

Not classified

Districts has no TOKİ projects

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Table 2. Revised Classification of Income Groups in Housing Projects by TOKİ

Project

Highest

Price for

Housing

Unit (TL)

Data for lowest priced housing unit

TOKİ Income

Level

Categorization

Necessary

income for

affording

monthly

repayments

Adjusted TOKİ

Income Group Price

(TL)

Down

payment

(TL)

Repayment

Term

(Months)

Initial

installment

(TL)

Housing

unit

floor

space

(m2)

Price per

sqm

Kayaşehir -12.

Bölge 79.950 49.000 8.000 180 228 67 731 Poor 760

Low Middle

(750-1000 TL)

Tuzla Emlak

Konutları 1. Etap

2.Kısım

145.000 56.500 5.000 180 921 59 958 Low Income

and Poor 3.070

High (3000 TL

or higher)

Kayaşehir 17.

Bölge 250.929 109.763 10.976 96 1.029 122 900 Low – Middle 3.430

High (3000 TL

or higher)

Varyap Meridian 2.123.000 386.000 81.060 30 11.079 61 6.328 High 36.930 High (3000 TL

or higher)

Küçükçekmece

Göl Konutları 130.000 79.400 16.000 180 352 84 945

Mixed (Middle

+ Low Income) 1.173

Middle Income

(1000 - 3000 TL)

Data Sources: for Varyap Meridian www.varyapmeridian.com (Accessed: 10.10.2011) for other projects www.TOKİ.gov.tr (Accessed 10.10.2011).

According to the results, to be able to buy the lowest priced housing unit in Tuzla Emlak Konutları (Identified to be for poor and low income groups by TOKİ) a family must have a monthly income of TL 3070; and this figure actually represents high income category, not poor (as of 2011). Moreover, it should be noted that the floor space of the referred housing unit is 59 sqm, while in Kayaşehir, where relatively affordable units can be bought, the lowest priced housing unit has a floor space of 67 sqm.

Taking into account all housing and non-housing business operations of TOKİ and its partnering companies has a turnover of 11,217 million between 2003-2012, only on resource development projects in Istanbul. In comparison, TOKİ only used around 1275 million of this turnover (11%) figure to fund so-called social housing projects.

Table 3. Resources Allocated for Provision of Social Housing in TOKİ’s Istanbul Operations (2003-2011)

Operations Volume

Total revenues from resource development operations 11,217 (million TL)

Turnover per project in resource development operations 104 (thousand TL)

Total revenues from resource development housing projects 9,380 (million TL)

Turnover per housing unit in resource development housing projects 282,393 (thousand TL)

The total cost of social housing projects for TOKİ 1,275 (million TL)

The average cost per housing unit in social housing projects 48,445 (thousand TL)

Source: Altınok, 2012:244-278

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On the one hand defying all ecological thresholds across Istanbul and at the expense of adding millions more to the existing 15 million population in the city, TOKİ fails to allocate the funds generated through its operations for renewal of poor quality housing of low income groups facing the earthquake risk. Despite the earthquake risk is the selling point of all urban transformation projects, TOKİ continues to produce housing for “new wealthy class” of the new Turkey.

Interventions on Urban Land Tenure in TOKİ Zoning Areas and Mechanisms of Resource Transfer

Under the scope of the research, Küçükçekmece-Başakşehir-Avcılar development area located within the Küçükçekmece watershed is studies in a district scale examination. Within the scope of this research, the process of property transfer, was examined comparatively for 2002 (prior to TOKİ operations) and 2010 (post TOKİ period).49

This research builds to the conclusion that TOKİ establishes the necessary conditions for reorganization of the accumulated capital over urban space by interfering with 'land tenure structure’. This interference can be summarized as follows:

TOKİ first takes over the property ownership most of lands within the development zones. By doing this way, TOKİ destroys the existing ownership scene and during the planning process, provides the conditions for the specific spatial arrangements it desires. Furthermore, the complete transfer of ownership of such lands to TOKİ, plays an important role in the subsequent transfer of additional surplus value created by planning.

Figure 11. Mechanisms of Resource Transfer in TOKİ Zoning Areas (Başakşehir-Avcılar-Küçükçekmece 2002-2010)

2002 2010

Source: Altınok, 2012:368-370

49 For all property maps for this study, see. Altınok, 2012: 368-370.

TOKİ

TOKİ+Subsidiary shared

TOKİ+Treasury shared

TOKİ+Other Public Institution shared

Treasury

Other Public Institution

Municipality

Foundation

NGO

Private property

No show

Military zone

TOKİ Properties

Other Properties

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TOKİ interferes with private properties50 in two different stages / using three different methods: The first stage/method is purchase. For that purpose the Administration usually employs its affiliates (EKGYO and Emlak Marketing Inc.), though these entities acquires the land at lowest prices as possible.51 If an agreement cannot be reached, as a second stage, TOKİ registers the district as a mass housing development area, then prepares the zoning plan. By this means, the Administration opts to land expropriation as a third method, through annotations laid on the remaining title deeds. To this end, TOKİ plays an intermediary role in the transfer of surplus value from one owner to the other owner of the private property; expropriation which is supposedly a power to be exercised for the interests of the public serves as a tool for 'transfer of ownership'.

Conclusion

“Slums and unplanned areas are known to be the fertile ground for terrorism, drug, anti-establishmentarianism, low education, psychological distress and

health problems. We cannot prohibit settling, but concentration of impoverished folks in Istanbul must be prevented”

Erdogan Bayraktar (Former Head of TOKİ) Hürriyet, November 12th, 200752

The housing paradigm which started as the struggle of rural populations migrating to metropolitan areas in the 1950s and holding on as 'squatters', first took a form of 'self-urbanization' enabling the urban lower-middle and middle class taking advantage of state subsidized loan opportunities through 'housing coops' in the wake of 1980s; and today it has transformed into a new model of state-led 'dispossession' (enforced relocation of the poor53 / privatization of public assets, natural resources) and 'possession' (by encouraging those who wish to acquire real estates to taken on loans, making them dependent on the stability of the economic and political system).

At this point, we need to re-think the role of the state and current planning practices. Urban planning once used as to heal the wounds inflicted by the inequality generating capital, now directly generates inequality by serving the needs of the capital. For capitalist space production this inequality may seem trivial, but in reality cannot be overlooked. The geography of investments created through planning is pillaring on a predetermined consumption and profitability capacity foundation from the get go. However, this mechanism is dependent on the expectations of the capital and social dynamics to function. Changing trends and social contradictions can turn the once advantageous geographical conditions into the disadvantages.

Both Lefebvre (2003: 159) and Harvey (2003) discuss territorialization of productive powers as a process of freezing the capital itself in a fixed spatial form (in a geometrically limited space) as a paradox of production of space.

50 It should be noted that the referred private properties in the study area of Başakşehir-Avcılar-Küçükçekmece Urban Development Area (BAKKGA) are mostly large chunks of old farmlands which can be transformed faster/easier.

51 At the beginning of the process, the value of the private land is relatively low as there is no development plan. However, once the zoning plan is completed the value increases. In this way, affiliates grab an unfair advantage.

52 News story: "Let's find a way to keep broke folks away from Istanbul." http://www.hurriyet.com.tr/ekonomi/7677664.asp [Accessed February 24, 2015]

53 For two well-known relocation examples, see Kuyucu and Ünsal, 2010 (Ayazma-Beziganbahçe example); İslam and Sakızoğlu, 2015 (Sulukule-Taşoluk example).

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For capital, financial speculative dynamics is another risk imposed by the process. We know from experience that pumping excessive cheap loans in the economy, growth of the financial bubble in parallel with the growing current account deficit and in a scenario where bad loans prevail immensely deep crises break.54

...and of course, capital accumulation relationships do not explain everything. A large part of the urban population have needs that are inconsistent with the capital drive. The issue presents social and spatial dilemmas as well as its political economy dimension.

The most important thing to be said for Istanbul, is that the city has reached an unmanageable size and at the brink of exhausting all its sources. Excessive housing supply does help nothing but creation of low quality urban spaces that offers nothing else but housing.

So called social housing projects implemented by TOKİ are not actually affordable for the target audience. Consequently, the very phenomenon is deepening the social contradictions rather than to appease. The urban space continues to disintegrate, particularly as a result of the mega projects and mass housing investments. Gated communities isolated from the urban spaces and urban life continue to increase. Within a predefined and non-integrated urban structure, different socio-economic and cultural groups are separated from each other by distinct boundaries.

This social segregation and spatial fragmentation paradox itself is perhaps the very obstacle on our path that could lead us to the solution.

Defining the 'urban revolution' Lefebvre (1991[1974]:51) also identifies the obstacles in front of it as follows:

“..It is difficult to see how so odd an indifference could be maintained without diverting the attention and interest of the 'users' elsewhere, without throwing sops to them in response to their demands and proposals, or without supplying replacement fulfilments for their objectives.”

54 Real estate crises in Asia, such as Thailand and Indonesia crises (Harvey, 2003: 112).

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TOKİ West Ataşehir development area and social-spatial segregation, 2011.

Photos: Emrah Altınok

TOKİ development areas, a view of TOKİ Avcılar-Ispartakule project from West Resneli, 2011.

A transformed slum area and a yet to be transformed slum area facing each other, TOKİ Ağaoglu Ayazma project, 2013.

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