Gentrification & Displacement on Indy's Near East Side

The Damien Center is located in Arsenal Heights, a tiny neighborhood of roughly 3 x 4 blocks, within the larger neighborhood of Holy Cross on Indianapolis’s near east side. In 2005, the not-for-profit organization, which provides services to people living with HIV and AIDS, chose its location at 26 N Arsenal Ave in part because its zip code (46201) had one of the highest rates of HIV in central Indiana. According to the  Indiana State Department of Health , HIV disproportionately impacts people of color, the LGBTQ+ community, individuals experiencing homelessness, and those who are regularly exposed to drug use or sex work. The area, which had suffered for decades from redlining, disinvestment, and white flight, was convenient to many people for whom standard healthcare and public services were ineffective.

Today, nearly 20 years after the Damien Center moved to the area, it is more densely populated and is home to a significantly more affluent group of people, attracted by its convenience to downtown amenities and to a growing number of restaurants, coffee shops, and breweries.

Does this mean that Holy Cross has gentrified? Using  SAVI ’s definition, gentrification is “racial and cultural displacement driven by increased housing demand.” During the gentrification process, private investors, businesses, and local governments tend to benefit financially, while low-income existing residents cannot keep up with dramatically rising housing prices, and their communities are often torn apart. Developers use aggressive, even predatory strategies to push existing homeowners out so that buildings can be fixed up and sold or rented at higher rates. It seems clear that Holy Cross is at some stage in the gentrification process.

The  Holy Cross neighborhood website  boasts its "renaissance," saying that it is "back to life and better than ever."  Downtown Indy, Inc.  advertises the area to potential residents as a "best kept secret" with "something in everyone's price range." This boosterism is commonplace not only in Holy Cross but across Indianapolis, which seems to prefer an optimistic view of itself as a community in the midst of urban revitalization. It is certainly convenient for the real estate industry, developers, local marketers, and others who are positioned to profit from rising home values.

However, this heavily promoted narrative simplifies a number of historical facts, glosses over the displacement of people who had been living in the area prior to its “renaissance,” and ignores the role of public policy in the decline and rebuilding of the area. The history of the area is much more complex, and provides some fascinating insight into the development of Indianapolis and the policy-driven cycles of 20th century urban decline and 21st century re-urbanization.

Holy Cross was first settled by Euro-Americans in about 1820, making it one of the earliest building sites in Indianapolis. The Pogue and Noble families (names familiar to many locals) were among the first in the area. Highland Park, a central green space of the neighborhood, was created when the last Noble family member to live on that site sold it to the City in 1898.

Between 1870 and 1920, Indianapolis expanded rapidly, driven by immigration from abroad, annexation of smaller towns, rural-urban population shifts, and industrialization. In appearance, over these 50 years, it became an industrial city rather than a small farming town. To the south and west of downtown, there were a number of railroads and stockyards, and residential areas like Holy Cross grew to the north and east.

The architecture of Holy Cross reflects its rapid expansion during these decades. It developed initially as a suburb, but between 1891 and 1902, Indianapolis went through the first of several waves of outgrowth and annexed areas of the near east side as far as Irvington. By the 1890s, nearby Woodruff Place was one of the most socially prestigious neighborhoods in the area, and it was one of few areas that successfully avoided incorporation for several decades.

A significant number of Catholic immigrants settled in Holy Cross, particularly from Ireland and Germany. In 1921, they built the Church of the Holy Cross, which gives the neighborhood its name today.

Through the 1940s, the area continued to grow rapidly. It was primarily a white, working class neighborhood whose residents were employed on nearby railroads, in downtown industry, and possibly in domestic service in nearby Woodruff Place. Gradually, over the generations, locally born people became the predominant population rather than immigrants. According to New Deal redlining maps, there were a number of African American households in the northern section of the neighborhood, but the majority of residents were “native white – laboring and mechanic types.”

Population numbers began to decline in the 1940s, driven by urban planning that repeatedly enhanced and legitimized segregation, white flight, and urban disinvestment. Housing loan policies of the New Deal created radical opportunities for white Americans to develop wealth through home ownership but left out communities of color. This area was part of the “redlined” urban core of Indianapolis, where loans were considered “hazardous” and generally only available through predatory speculators. In Holy Cross, white people with the means to do so would have felt encouraged to move further outside the core of the city, into areas where better loans were available.

It was not only federal policy and private real estate lenders that encouraged segregation and disinvestment, but also local government. Like cities across the country, Indianapolis defunded programs and services that benefited those near downtown. Policy makers were generally in favor of small government and budget cuts, which included an attempt to sell Highland Park in 1954 (successfully combatted by the neighborhood).

When Unigov was created in 1969, it expanded the territory of predominantly white Indianapolis, decreasing the voice and percentage of people in the urban core. Black residents, who lived mostly in the new “center township,” decreased from 27% to only 18% of Indianapolis’s population. Schools remained localized, and council members had little success in bringing funding to the increasingly under-resourced schools and public resources near downtown.

At the same time, I65 and I70 were built through the center of the city, displacing thousands of people, including residents of Holy Cross. Once again, the population decreased dramatically as the highways made the area less desirable and encouraged those with means to live farther away and commute longer distances.

With all this in mind, it is not surprising that in the late 1960s, studies of the area began to show increasing poverty, racial tensions, higher rates of renters (as opposed to home owners), housing deterioration, and higher crime rates. But neighborhood coalitions, nonprofits, churches, and businesses stepped in to combat the void created by displacement and disinvestment; while it remained a low-income neighborhood, they succeeded in stabilizing many programs and services.

Since 2000—and even more after 2010—the real estate industry has become interested in the area again. The city and private developers have ridden a tide of demand for urban living (exemplified in  this  MIBOR Realtor Association Community Preference Survey). According to the most recent census data, about two thirds of current Holy Cross residents moved to the area after 2010.

Driven by economic motivations, government and real estate interests continue to encourage people to purchase, rent out, or flip homes in the area. Along with most surrounding neighborhoods, Holy Cross and Arsenal Heights have been designated a federal “ Opportunity Zone ,” with the explicit goal “to encourage long-term private capital investment.” It is easy to find maps  like this one  giving Holy Cross an A real estate rating, while Arsenal Heights earns a B. According to  its explanation  of neighborhood grades, A-class neighborhoods “are primarily owner-occupied single-family homes” with “top-notch” schools and “higher-quality tenants.” In B-class neighborhoods, “you will be able to find single family homes that need little work and get solid rental rates. Residents will include some education beyond high school and some blue collar workers. A very solid tenant base will live here.”

These maps read like contemporary versions of the New Deal redlining map, except this time the city and private investors believe it is in the public’s best interest to develop and gentrify areas like Holy Cross. Public opinion now favors older homes (which once were a detriment) and walking-distance amenities, and the city and businesses are able to capitalize on that.

Although about 80% of Holy Cross residents live in homes built prior to 1939, the contemporary young, urban professional is different from the working class, largely immigrant families that lived in these homes when they were built. Today’s neighborhood residents tend to be young, white, and relatively affluent. About 56% are between the ages of 25 and 44, and the majority (even among families) do not have children under 18. More than half live either by themselves or with roommates, and 57% hold at least a bachelor’s degree.

The table below estimates demographics and trends over the past 20 years, by comparing data from the 2000 US Census with the most recent Census data currently available (the American Community Survey 5-year average). The changes are clear and dramatic.

Holy Cross is not so completely gentrified as some parts of downtown Indianapolis. It still contains a checkerboard of abandoned buildings and homes in need of repair—particularly in Arsenal Heights and other eastern sections of the area. However, if the common markers of gentrification are increases among white population share, income, property value, young adults, and people with a college degree, all of these factors are clearly at play in Holy Cross.

In 2020, the economic downturn caused by COVID-19 put some real estate development in question. But a drive around the neighborhood today seems to indicate that renovations and new buildings are continuing apace—or perhaps even increasing in rate—since the pandemic.

Gentrification is a controversial topic; in Indianapolis, some people deny that it exists at all, others say it is justified for economic reasons, and still others compare it to colonization in its attitude of entitled taking. But it is difficult to argue that the process at play—whatever we call it—benefits people and business with more money and assets, while it is detrimental and damaging to people with fewer assets, and frequently to people of color.

The common narrative of “decline” and “rebirth” is problematic, simplistic, and one-sided. It erases the recent history of the neighborhood and the purposeful policy and business decisions behind the economic cycles that the neighborhood has experienced. In addition, this viewpoint does not consider what options are available to the people who were previously residents of the area—people like the Damien Center’s clientele. They are now likely to be forced to areas with fewer resources, where they will have to commute longer distances via public transportation.

The photo tour of the neighborhood gives a sense of the juxtaposition of historic homes, recent refurbishments, new developments, and vacant buildings in the area.