Industries Flee High Rents, Traffic Jams : Amsterdam’s Core Becomes Gentrified

The rising land costs and traffic jams of modern Amsterdam are changing the face of the “Canal Belt,” the city’s cultural and economic core since the middle of the 14th Century.

The industry that has operated there for centuries has moved to the suburbs, leaving behind a 35% unemployment rate in the area and bringing yuppie-like gentrification and skyrocketing rents to neighborhoods that hadn’t changed much since the 17th Century.

The latest and the last of the industries to depart was Klene’s candy factory, which had permeated its neighborhood with the distinct aroma of licorice since it opened in 1915.

Candy Firm Sours on Area

Klene’s factory moved to a modern, $9.5-million plant in Hoorn, 20 miles north.

“We left for a number of reasons, but the catastrophic traffic situation here was the most important one,” said Hans Hilarius, Klene’s managing director.

The company serves about 10% of the Dutch licorice market, with yearly sales amounting to the guilder equivalent of $4 million.

As Klene’s output more than tripled over the past decade, getting the ingredients--mainly sugar and starch--in and the licorice and peppermint out became an almost impossible task because of the Canal Belt’s old, narrow streets, Hilarius said in a recent interview.

Obstacle Course

“The daily average was five 20-ton trucks with raw materials and the finished product a day,” said Hilarius. The trucks had to run an obstacle course of traffic jams on the 8-foot-wide street along the Looiersgracht Canal.

Industrial activity within Amsterdam’s city center had been declining since the mid-1960s, when the city developed huge industrial zones in the deep-water port area west of the city.

But development of the industrial zone was stunted by the oil crisis recession of 1973.

Instead of industrial giants coming in, it was small- to medium-sized businesses that took refuge from heavy traffic and high land leases in the city-owned industrial zones. City leases, which serve as a sort of real estate tax, have increased from the equivalent of $1.20 a square foot in 1978 to $4 now.

An Amsterdam Chamber of Commerce survey indicated that during the last eight months of 1986, more than 800 such firms moved out of the 2.3-square-mile Canal Belt, taking with them about 2,200 jobs.

Among the major departures was the Heineken brewery, which shifted its main brewery to Zoeterwoude, 25 miles south of the capital, and kept only its head office and a demonstration plant for tourist tours in the capital.

‘Worries Us Greatly’

“It worries us greatly that 35% of the city center’s work force is now unemployed,” said Chamber of Commerce chairman Rob de Vilder, “and most of the companies that left employed low-grade labor.”

Amsterdam’s average unemployment rate is 18.4%, well above the national figure of 14%. Klene’s 85-member work force was made up of unskilled laborers.

Hilarius said he unsuccessfully tried to buy city land for a new plant in the cramped city center. City Hall spokesman Harald Ytsma said, however, that no municipal land had been sold since 1896, when the city adopted a lease-only policy to gain tighter control over land use.

Part of the area’s unemployment problem stems from the traditional reluctance of Dutch workers to commute to jobs outside their own cities, with the majority of the commuting class being white-collar employees.

A Rosier View

De Vilder of the Chamber of Commerce minimizes the problem of industry abandoning the city center, saying other, smaller business are taking its place.

“The city is losing lots of unskilled jobs, but on the other hand, thousands of small businesses are opening their doors every year,” he said.

“What is industrial activity? In our view, a small computer repair company also is industrial activity, and such firms abound in the inner city.”