Like Williamsburg and Greenpoint, DUMBO, the acronym for Down Under the Manhattan Bridge Overpass, is on the verge of becoming another SOHO—that is, a neighborhood initially transformed by artists, but now populated mainly by upper-income professionals. Like these other gentrifying areas, DUMBO, which encompasses some 15 blocks, including a half-mile stretch along the East River waterfront, has its own unique and rich history.

The neighborhood has existed for well over a century. On the eve of New York City’s consolidation in 1898, DUMBO was home to over 140 industrial businesses, including iron and brass foundries, chemical plants and manufacturing companies. Although most of those industries relocated long ago, many of the warehouses and factories have remained standing and have become homes for many artists and other intrepid bohemians over the past 20 years. Most of the area’s residents, particularly the artists, have come here to find living spaces that are large enough to live in and house their works without having to pay Manhattan prices. These days, there are very few places in New York City where one can get away with paying, for example, $4 per square foot per year for a 3,000 square foot loft. But up until two years ago, that was the average rate in DUMBO.

Nowadays, one can expect to pay in the neighborhood $18 per square foot per year. One of the primary reasons for this substantial rise in prices can be summed up in two words: Two Trees. Two Trees Management Company is a real estate business that was founded by David Walentas, one of DUMBO’s largest property owners. Realizing the potential gold mine that is DUMBO, Walentas has taken a hint from other city development projects and has proposed to turn it into the next Times Square. At the moment, the area is home to two upscale restaurants and home furnishing stores, a wine store, a pet store, a framing shop, and the neighborhood’s first grocery store. Yet what are Walentas’s proposed future endeavors? For starters, try a 6,000 square-foot Irish-style saloon and a 250-room luxury hotel.

As expected, some of DUMBO’s long-time residents, mostly artists, are not happy with all of the recent additions or especially the plans for future ones. One reason is the fear that the area’s commercialization will lead to the disappearance of yet another link to the city’s history, another cultural death. The building of hotels and grocery stores generates tax revenue for the city, but it raises the possibility of tearing down buildings that many believe have a significant place in New York City’s industrial and labor heritage.

In response to the potential threat, residents formed the DUMBO Neighborhood Association and the Old Brooklyn Waterfront Alliance. Since 1997, these two organizations have resolved to fight for, among other things, the area’s place in the National Register of Historical Places. In addition, Place Matters, an organization created in 1998 by the Municipal Art Society and City Lore, has been working closely with concerned DUMBO residents.

Unfortunately, there has been an absence of similar organized aid for a more immediate struggle faced by the artists, namely eviction. Along with the massive inflow of retailers, Walentas has rezoned much of the property for residential use, converting some 40 buildings into condominiums and rental apartments. And although these actions may have allayed fears concerning the demolition of historical buildings, they have not eased fears of possible displacement.

At least 500 artists live in DUMBO, and over the last 18 months, there have been a number of eviction scares that rattled this small community. There were only a handful of actual evictions, but that was enough to create concern among many area artists, like Mike Kamber. Kamber, 39, is a freelance photographer who has lived in DUMBO since 1992. Although he has enjoyed $600-a-month-rent for a 1,800 square foot loft, he has spent nearly $80,000 in legal fees trying to keep it. Since last year, those in similar situations to Kamber have met a number of times and have agreed to get lawyers.

The Brooklyn Livework Coalition has been struggling to attain passage of a loft law covering Brooklyn, which would help the many DUMBO artists who currently live in illegal loft situations. But many local artists fear that any legal action on their part could increase their vulnerability for eviction. Still another reason why the amount of activism around these issues has been less visible in DUMBO is because many artists there also see the area’s commercialization as a positive change.

Many DUMBO residents have long complained that they have had to walk long distances to neighboring areas just to buy a bottle of juice. Aside from these minor inconveniences, they feel some of the proposed changes of Mr. Walentas and other developers will markedly improve the overall quality of life for many of the area’s residents. “Some people are very excited by this increased vitality, artist and non-artist alike,” says Michael Counts, a co-owner of GAle GAtes et al., a leading DUMBO art space. “They feel that it increases their visibility, it makes things safer, it brings in more business and conveniences to the neighborhood that will change the quality of life around here.” Joy Glidden, director of the DUMBO Arts Center, echoes Counts’s view, saying that Walentas’s vision, though not ideal, is the best of all evils. Walentas, she says, has been a long-time supporter of the arts—and has offered space for exhibits organized by the DUMBO Arts Center. Like Counts and Glidden, many other locals believe that Walentas will continue to see the neighborhood’s arts identity as its primary advantage.

For residents of the nearby Farragut housing project, the benefits of Walentas’s developments are not so certain. Farragut is not far from the site of the proposed hotel. As a member of the Farragut Tenants Association told the New York Times, most of the changes in DUMBO would not be designed around the needs of most of Farragut residents, who would have little income to spend in the new restaurant, shops, or saloons. Farragut tenants’ primary concern, however, involves the value of area real estate, which will inevitably rise with the new developments. Despite reassurances from housing authority officials, they fear that development will make long-time residents increasingly vulnerable to eviction.

DUMBO thus faces many of the same dilemmas as other neighborhoods targeted by developers—not only of how to preserve its older industrial character alongside its newer arts identity, but how that can be accomplished in an equitable fashion. Only time will tell what kind of neighborhood emerges.