During 2001 Argentina's economic collapse, 30 percent of the population was unemployed, and pennyless -since their savings were caught in the broken banks and available at 200 dollar a week paid in 70% devalued pesos per original dollar deposited.- During that period, however, young professionals moved to a cheap, blue-collar old Buenos Aires neighborhood -named Palermo by Italian immigrants- and transformed it into the most successful area of Buenos Aires: Palermo Soho and Palermo Hollywood.
They did it in small groups of 3 to 4 under-35 year old entrepreneurs, buying ruined and abandoned houses -like the one below- with initial investements of around 10,000 dollars.
The now self-employed architects and engineers renovated the old houses, transforming them into boutique hotels, restaurants, art galleries, stores and private homes.Those in the restaurant and art businesses moved from expensive downtown Buenos Aires rents into the new places.
Those with business degrees and good English started publicizing Palermo in US and European newspapers.
Thanks to the tech-savvy, they used e-performance to link their offerings to international tourism-related Web sites such as Expedia, Priceline and all major US and EU newspapers, so tourists could check and make reservations directly of all the services and products.
Soon, an avalanche of tourists -attracted by the Web-informacion as well as the peso devaluation- started roaming through the neighborhood, patronizing their stores and restaurants and "getting out the news" to their countries of origin.
Old homes like this one -bought under 35,000 dollars- are now listed and sold to nationals and internationals on an average of 350,000, redesigned and redecorated by argentinian architects and engineers, with argentinian young artists art and furniture.Palermo's entrepreneurs started also a small film industry, producing art and TV films subsidized by the government and attracting Hollywood stars and moguls such as Francis Ford Coppola, Madonna, Robert Duvall and Robert de Niro to film in and buy houses in Palermo.
Coppola filmed his last picture in the street below, with its old houses painted and decorated by young argentinian artists.
The entire neighborhood organized itself as a business ecosystem, creating clusters of compatible businesses -hotels, restaurants, stores, art galleries, developers and builders- organized block by block to offer a unique client experience to tourists and locals and to keep everthing clean, safe and organize street commerce -from high end to street sellers- in a harmonious way.At the time of the present crisis, Palermo remains strong, backed by steady income from tourism -both cultural and recreational- that chooses its calm and creative neighoborhood hotels, low prices and toursit-friendly, English-speaking young waiters,
restaurateurs and artists.Check this video showing the place with a rock and roll song referred to them, the "locos de Buenos Aires" (Crazies from Buenos Aires) as they were called at first:
Today, they don't laugh anymore at them: they buy their houses, eat at their 200 restaurants and shop at their stores, which in total provide income and jobs for an estimate of 45,000 families.
How can we use Palermo's lessons in building our own ecosystems?
In Argentina, other neighborhoods, such as Boedo and La Boca have already followed the ecosystem idea.
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References
- Fodors' Guide: Palermo Soho restaurants
- Palermo Hollywood Real Estate / Properties
- Palermo Hollywood lofts for rent
- Lee, D. (2008) Argentine nights . New York Times
- WhatsUpBuenosAires. Web site
- Mount, I. (2008) Rebirth of a bohemian barrio: Boedo. New York Times
- Independent film producers in Palermo (guide)
- Shoot Argentina: Film studios in Palermo
- Video Palermo viejo
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