WSJ: For More U.S. Cities, Downtown Is a Center of Economic Strength

PHILADELPHIA—Theresa Lounsbery sets out from her apartment in this city’s blue-collar Lower Northeast section each workday. Her neighborhood, Oxford Circle, a district of 2 square miles, has been hammered by manufacturing’s long slide. Median household income in her immediate area is down more than 30% since 2000 to roughly $37,000.

But less than 40 minutes later, the 43-year-old sat on an elevated train approaching Philadelphia’s Center City, a 7.7-square-mile mini-boomtown framed by a skyline about to reach new heights with a 1,121-foot office tower under construction. The median income in parts of greater Center City has shot up nearly 90% to $80,000 in the past 15 years. High-earners scoop up townhouses for $800,000 or more, while businesses and law firms lease gleaming office space.

Ms. Lounsbery moved to Oxford Circle with her teenage sons two years ago because of cheap rent: $670 a month for a two-bedroom apartment on the upper floor of a row house. A preschool teacher for 10 years, Ms. Lounsbery studied to be a paralegal to earn more money after her divorce. Last summer, she started working at a personal-injury law firm, making double her teacher’s salary and gaining a foothold in the Center City economy.

Ms. Lounsbery’s 10-mile commute highlights the little-noticed polarization under way in many postindustrial cities in the Northeast and Midwest.

For years, economists and urban experts talked about the doughnut hole of decay in city centers. But increasingly, many urban cores are islands of economic strength surrounded by decay that reaches out into inner-ring suburbs—beyond which fortunes rise again in more distant suburbs.

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The move to urban living is a global phenomenon. We see that locally with the revival of San Francisco. As the article says at the end, this trend is driven by millennials. These millennials will marry and raise family. Will we see the trend reverse, as the young parents discover the utility of 2 car garages, large backyards and minivans?