Capturing planning: Politics of land based accumulation in Tehran

Introduction

Recent scholarship has investigated the complex relations between states and other actors in shaping skewed possibilities of value extraction from urban development through several inter-related concepts, including entrepreneurial urbanism (Liong et al., 2020; Moreno Zacares, 2020; Raco, 2018); speculative urbanism (Steel et al., 2017); unsolicited urbanism (Rogers and Gibson, 2021); and states’ real estate turn (Shatkin, 2016). At the core of these concepts is a suite of socially and politically embedded regulatory and technical spaces, operating at the nexus of state apparatus, and political and economic elites, including the construction and real estate sectors (Moreno Zacares, 2020; Rogers and Gibson, 2021). While a growing body of this research has focused on the transformation of state and state-market relationships under the neoliberal turn, recent works call for understanding the processes of Land-Based Accumulation (LBA) beyond neoliberalization (Robinson and Attuyer, 2021; Yeşilbağ, 2022; Yiftachel, 2020). These works concern that a narrow focus on neoliberal urban governance overshadows the context-specific processes and dynamics that shape the politics of LBA (Robinson and Attuyer, 2021), which need to be examined on their terms.

Concerned with these politics, in this paper, I examine how the relations between the state and influential political actors shape skewed land value extraction by drawing from studies on state capture (Bracking, 2018; Fazekas and Tóth, 2016; Innes, 2014). State capture is characterized as the proliferation and entrenchment of specific groups and networks in and appropriation of “some parts or functions of the state to their benefits while harming the public good” (Fazekas and Tóth, 2016: 322). Processes of state capture are configured in context-specific and historically embedded institutional formations and transformations, and hence, studies report a variety of forms and different levels of state capture in different countries and times. A more complete form of state capture involves “a sweeping appropriation and a near wholesale intertwining of state resources” (Wedel, 2003: 427) by political actors.

Inspired by this literature, I examine the processes of LBA under the condition of unchecked wielding of political actors’ power over urban governance and planning. This lens diverges from the analytical frames used in recent insightful studies on corruption and elite informality in urban governance; It differs from systematic corruption in urban governance in that in the latter, networks of actors use, buy or, persuade corrupt state actors, while in the former, actors occupy positions in the executive sections of the state (Wedel, 2003) and hence can monopolize defining what is corrupt as well as legalizing what is illegal. This lens diverges from elite informality as it points to political actors’ interests – in addition to economic gains - in asserting, advancing, and concretizing their political positions.

Viewing from this prism, I focus on one planning institution in the Tehran metropolitan area, the Tehran Point 5 Committee (hereafter the TPC), and argue that it offers a useful lens for understanding the processes of LBA and can contribute to the frameworks of corruption, elite informality, and neoliberal urbanism. This prism highlights that planning mechanisms are often prone to capture as they mediate the generation and distribution of significant economic returns from urban development. However, this concept has attracted little attention in urban studies. Examining this case shows how planning instruments and institutions, initially established to pursue public benefit, can be appropriated and captured by politically powerful actors to promote their interests in urban development to the detriment of the public.

Pursuing this aim, the rest of the paper is structured as follows: The next section provides an argument on how three inter-linked bodies of literature, neoliberal urbanism; elite informality; and corruption, inform our argument around state capture and at the same time in what ways the latter departs from these analytical frameworks. Then the paper sets the scene by explaining the Iranian context and how politically powerful networks were shaped and assembled as the legacy of the 1979 revolution and later ‘economic reforms’. Then I turn to the TPC as an institution initially established to provide flexibility to the planning system. A method section follows. The remaining sections explain how this institution is captured by political elite institutions and its consequences for the public benefit. Finally, I reflect on the contribution of the scholarship on ‘state capture’ in understanding how planning instruments and institutions operate under the influence of political forces.

Neoliberalism, elite informality, and corruption

Three interconnected streams of research have provided helpful lenses to better understand how the relationship between states and elites shape, and are shaped by, the processes of LBA; the literature on neoliberal urbanism; elite informality; and corruption.

First, the literature on neoliberal urbanism discusses how the integration of neoliberalism as a ‘governing rationality’ (Brown, 2018) into planning and urban governance systems has reconfigured the relations between the state and non-state players. This literature particularly focuses on the states’ strategies to attract private investment, which overwhelmingly favour high-end developers, realtors, and investors (Steel et al., 2017). These strategies mainly involve introducing more ‘flexibility’ into planning and urban governance systems to provide the leeway needed to regulate and steer urban development according to the logic of the market (Ozkan and Turk, 2016; Roy, 2009). These include relaxing planning restrictions (Liong et al., 2020; Shih et al., 2018); issuing legal exemptions; easing taxations (Anderson, 2019; Krijnen and Fawaz, 2010; Ong, 2006); fast-tracking certain planning permits (Pow, 2017); and joint ventures in megaprojects (Mouton and Shatkin, 2020). These pro-elite reworking of planning instruments have been mainly framed by the local governments’ need to generate revenue (Karampour, 2021; Shih et al., 2018). Nevertheless, ‘neoliberal urbanization’ seems too broad a term “to adequately capture the complex and variegated relations between the state and other actors (Steel et al., 2017: 138). In particular, focusing on neoliberalism as the sole explanatory framework for using these strategies runs the risk of losing sight of states’ interests other than generating revenue (Wu et al., 2022; Yeşilbağ, 2022); rendering invisible who - other than the coalition of developers and local state entrepreneurs - involve in and benefit from them (Le Galès, 2016; Shatkin, 2016); and obscuring the specific and institutionally embedded means by which they operate (Ghertner, 2015; Yiftachel, 2020). As a result, and while acknowledging the importance of processes of (variegated) neoliberalization, recent literature calls to examine the contextual territorialized politics embedded in LBA (Robinson and Attuyer, 2021; Wu et al., 2022; Yiftachel, 2020).

Second, the scholarship on elite informality also provides an analytical lens to frame the relationship between the state and other actors regarding LBA. Mainly adopted in the global South context, elite informality captures the porosity of the state for special groups (Bénit-Gbaffou, 2018). Aside from those involved in political patronage (Fawaz, 2017), global and local elites are those well-located to benefit from this porosity (Liong et al., 2020; Moatasim, 2019; Pow, 2017; Tasan-Kok, 2008). Elite urban informality refers to interest-laden processes, whereby the elites – in orchestration with the state or otherwise - engage in creating and deploying opportunities for LBA through mechanisms beyond formal channels available to the public (Krijnen, 2018; Krijnen and Fawaz, 2010; Moatasim, 2019). In this sense, these groups are the main beneficiaries of the aforementioned neoliberal practices of making exemptions and exceptions in planning systems. Elite informality has been framed as deregulation (Roy, 2009), non-illegal (Bénit-Gbaffou, 2018), or extra-legal (Moatasim, 2019) processes. As such, the majority of these studies have stayed away from explicitly linking their discussions to corruption, despite the frequent reports about the elite consciously co-deploying licit and illicit strategies to maximize their benefits from the urban land market (Doshi and Ranganathan, 2019). Examples from this literature include but are not limited to, approaching influential figures and engaging in backroom deals (Liong et al., 2020; Tasan-Kok, 2008), exchanging favors (Krijnen and Fawaz, 2010), exerting direct and indirect influence and pressuring the officials (Koch, 2015), even those ‘in the highest administrative positions’ (Sundaresan, 2019).

Third, the re-emerging scholarly interests in corruption and urban planning and governance, in particular in South and East Europe (Chiodelli, 2019; Kusiak, 2019; Moreno Zacares, 2020), have furthered our understanding of the relationships between the state and other actors. This body of work attends to the selective and slippery nature of the concept (Muir and Gupta, 2018); its presupposition that norms and legal codes are necessarily aligned (Kim, 2020); and its elusiveness in the light of shifting the modus operandi of the elite (Wedel, 2012) and focuses on more subtle ways of blurring and bending laws and regulations (Boudreau, 2019; Chiodelli, 2019; Haid and Hilbrandt, 2019; Moreno Zacares, 2020). What is at stake, however, is the differing capacities of stakeholders in manufacturing ambiguities, exploiting gaps, confusion, or opacity in knowledge or regulations to their benefit. This body of work, therefore, shifted our analytical gaze from focusing on a number of rent-seeking government officials to the processes and practices of intentional misinterpretation of laws and regulations even when formal procedures are not violated (Kusiak, 2019).

These bodies of work provide fruitful analytical tools to think about how formal and informal mechanisms are at work in shaping, manipulating, and exploiting development opportunities, the distribution of the generated economic returns, and their outcomes for urban environments. However, they still leave some analytical gaps: The first one concerns obscuring the role of other actors – other than developers, financiers, and realtors – who are involved in the politics of property (Yeşilbağ, 2022). The second gap relates to overlooking the state’s political pursuits that might be linked to the manipulation of planning systems and LBA. Studies – in particular those in illiberal neoliberal contexts - found such manipulations serving various political goals, including supporting backers of the state (Shatkin, 2016); cultivating patronage networks (Bayırbağ et al., 2023); or legitimizing and boosting political parties’ agendas (Valiyev and Wallwork, 2019; Wu et al., 2022; Yeşilbağ, 2022). Therefore, I argue for a reading that grounds the manipulation of planning systems in the locally-specific and historically embedded intertwining economic and political drivers of LBA and contextual particularities of the actors involved. Moreno Zacares (2020), for example, provides such an account in Spain, by showing how LBA is entangled with corporations’ competition for political parties’ influence on the one hand and political parties’ competition for raising illicit funds from them on the other. The fact that “many processes of urban change rather reflect […] political projects” (Le Galès, 2016), requires attending to the historicity and complexities of actors and their intermeshed and dynamic economic and political rationales mobilized in LBA. Along these lines, I suggest that insights from political theories can contribute to the aforementioned scholarship to better capture these complexities.

State capture and planning

In this section, I briefly explain the concept of state capture in political theory scholarship and then reflect on how this concept is connected and can contribute to the aforementioned research. Emerged from studies on the post-communist regimes, – but by no means stayed limited to them - the concept was initially used to frame how the variegated state-rebuilding trajectories and rapid transition to ‘economic liberalization’ are often associated with serving the privileged elites who participated in these transitions (Grzymala-Busse, 2008; Innes, 2014). Instead of viewing the state as a unified entity, these works conceptualize the state in the processes of becoming, being shaped, and re-shaped by different actors’ competition over authority. State capture involves the appropriation of state resources by these actors for their ends (Canen and Wantchekon, 2022; Grzymala-Busse, 2008). In these situations, actors cluster around different parts of the state, acting “collectively in pursuance of their private or political goals to the detriment of the public good” (Fazekas and Tóth, 2016: 320).

Historical political processes shape variations of state capture in different times and political regimes. Therefore, there are diverse forms of state capture, for instance, in terms of the actors involved, be it political parties, businesses, families, or institutions. Furthermore, there are differing levels of appropriation of state resources; In partial state capture, different networks work with relevant state authorities in different ways and are not synonymous with authorities. In more complete forms of state capture, these groups actually occupy positions in legislative, executive, and/or judicial authorities (Wedel, 2003). In such circumstances, there is a high degree of penetration to the state bodies or vice versa. Examining the operation of state institutions and processes under such circumstances requires us to focus on the historically embedded formation of such assemblages of actors (Wedel, 2003). Such an examination traces players in these assemblages and multiplex networks which criss-cross between different domains - public/private; formal/informal; and legal/illegal -; disperse among and traverse between different sectors; and flex and shift roles to suit their needs and amplify their benefits. These assemblages might establish institutions and mechanisms or morph and recalibrate the existing ones when required (Wedel, 2012).

Under the state capture circumstances, “the politics is more a means to split up the spoils of state resources” (Wedel, 2003: 437). Therefore, state capture most likely targets those parts of the states that manage the distribution of resources in sectors with economic and political importance (Fazekas and Tóth, 2016). Planning institutions, hence, are critical targets of and deeply prone to state capture as they create, mediate, and distribute significant economic gains from urban development. In particular, those planning institutions and mechanisms involving discretionary decision-making can be conveniently exploited and manipulated to elicit benefits from the land market. This point has also been highlighted in neoliberal governance literature, whereby planning systems are found to be transformed and reshaped to serve the private gains of economic actors (Shepherd, 2018). Yet, at a deeper level, planning is inextricably connected to fundamental political concerns such as its relations with the state, as well as private and public rights and benefits (ibid). This requires us to avoid positioning our analysis – in an authoritarian regime - simply as an iteration of neoliberal urbanism emergent from the global North. The state capture lens can arguably turn our gaze from LBA being exploited by solely economically-driven competing actors to the interpenetrated economic and political drivers of manipulating planning systems within the state’s broader historical processes of becoming.

Before turning to the case of Iran, we need to clarify the relationships between state capture and the three aforementioned literature. First, as Ong (2006) argues, neoliberalism is a malleable technology of governance that has been integrated into different regimes. Therefore, state capture is expected to be associated with picking strategies commonly used in neoliberal planning regimes to further the involved actors’ capability to tap the full potential of manipulating the land and real estate market. Such inconsistencies with the neoliberal tenets of competition are also observed in other planning and governance regimes (Rogers and Gibson, 2021). Likewise, informal, extra-legal, and rule lawyering practices that characterize elite informality and corruption have been primarily found at the interstices of the public-private’s blurred boundaries. However, in a more complete level of state capture, distinguishing between public and private actors and actors within the state seems almost impossible.

The formation of state and state capture

The aftermath of the 1979 revolution was a period of land grabbing and confiscating the properties of the old ruling classes, private banks, and other major private companies (Bayat, 1997; Maloney, 2015). According to the post-revolutionary state’s reading of Shi’i Islam (Vahabi, 2022), these resources were considered as Anfal, an Islamic concept which consists of confiscated assets, in addition to abandoned land and res nullius (e.g. forest, rivers) (Naghib et al., 2019) and belongs to the head of the Islamic state, upon which he has an exclusive, unrestricted, discretionary, and statutory (it is not hereditary) right to use and spend (Vahabi, 2022). ¹ After the 1979 revolution, a part of these resources was handed over to the government (the executive body of the state, in Farsi Bakhsh—e dolati) (Behdad, 1996; Valadbaygi, 2021), but the larger portion was given to new institutions established under the provision of Ayatollah Khomeini to manage them (Khatam, 2015). These institutions (a.k.a. Bonyads) are neither accountable to the public and the government nor pay taxes. Unlike public property which is supposed to be used and managed by the state on behalf of the people, the resources in the hands of Bonyads constitute the economic basis of the head of state power (Vahabi, 2022). As a result, the post-revolutionary state ² has a dual power structure, ingrained from the creation of this bifurcated system of economic and political power (Maloney, 2015; Saeidi, 2004).

State capture has grown out of the dynamic and evolving relationships within this bifurcated system, between what Vahabi and Maloney call ‘the formal state’ and Bonyads (and later on the military) during the coming decades. Initially claimed to be established to support the worse-offs, these organizations have grown into giant economic monopolies (Maloney, 2015). One stage of this evolution took place one decade after the revolution when the then government set itself the task of liberalizing the economy (Ehteshami, 2017; Valadbaygi, 2021) and privatizing public assets. The privatization process handed many public enterprises and their assets, including urban land and properties, to Bonyads (Ehteshami, 2017; Harris, 2013) and politically well-connected groups. State reports show that one-third of privatized state-owned enterprises went to them and only 13% were acquired by the ‘real private sector’. ³ These processes were legalized through different policy measures. For instance, a 1994 Parliament bill prioritized war veterans and state militia members in the share-sailing of these enterprises, while considering Bonyads and military-based organizations as the ‘representatives’ of these groups (Saeidi 2004). The rest of the privatized enterprises went to a complex network of front companies (Valadbaygi, 2021), owned by different sections of the state or military. As a result, Bonyads and military organizations hold large tracts of land in prime locations in Tehran. At the same time, IRGC (Islamic Revolutionary Guard Corps) exponentially increased its role as a monopolizing player in the construction sector (Harris, 2013; Valadbaygi, 2021).

Therefore, the so-called liberalization of the economy was intentionally engineered and harnessed to establish, sustain, and expand the economic and political superiority of what Valadbaygi (2022) calls a military-Bonyad complex. According to Valadbaygi (2021), many allegedly ‘private firms’ are the subsidiaries of various state sections (p.7). In 2019, it is estimated that 60% of the Iranian economy belongs to four Bonyads and military organizations (Vahabi, 2022). These economic resources are partly used for the consolidation of the political power of the state: through charity operations targeting the veterans and rural population and securing a clientele relationship with their social base (Harris, 2013; Maloney, 2015); serving the ideological and cultural needs of the state (Saeidi, 2004); sidelining political rivals or oppositions (Maloney, 2015); and creating a new dependent capitalist class (Valadbaygi, 2022).

Differentiating between the military-Bonyad complex and ‘the formal state’, however, neither implies the latter as the real representative of people’s sovereignty nor a lack of alignment between these ‘states-within-the state’. These relationships are described as destructive competition (Bjorvatn and Selvik, 2008) or destructive coordination (Vahabi, 2022). Yet, since Ahmadinejad’s presidency, the nature of this relationship has changed; evidenced by, for example, the former acquiring the latter’s main resources, including the oil-related economy (Maloney, 2015); or the members of the former increasingly occupying key positions in the latter. For instance and relating to this paper, while the ministers of Roads and Urban Development (hereafter RUD) were predominantly bureaucratic elites, the recent ones have risen from the military-Bonyad complex. It seems that the historical political processes that shape the Iranian variation of state capture involve an exponential penetration of the military-Bonyad complex to the ‘formal state’ bodies. In this context, the politics of splitting up the gains from urban real estate became increasingly important due to international economic sanctions.

The emphasis on the role of these organizations, by no means implies that they are the only actors shaping and transforming Tehran’s built environment. Another process, a popular one, has been transforming Tehran as well. Small developers and landowners were always interested in urban real estate as the most available and inflation-protected sector in the country. Since the shift to ‘liberalize’ the economy, urban governance procedures have continually accommodated and benefited from these interests. Accordingly, the Tehran municipality has consistently encouraged speculative capital investment into construction projects (Madanipour, 2006). Extracting fees in exchange for an increase in Floor Area Ratio provided a significant portion - even up to three quarters (Karampour, 2021) – of the municipality’s revenue. These measures increased the margins of profit from demolishing old buildings and constructing new higher buildings for thousands of small landowners and developers in Tehran.

Contrasting this measure, which is almost accessible to all registered landowners through district municipalities, any major non-conformance from the city’s Detailed Plan, in terms of land-use change, intensity, and the like, should go through a legal mechanism. In the next section, I will turn to this mechanism.

Tehran point five committee: Legalizing non-conformity

Iranian spatial planning system is mainly based on a regulatory approach and development control tools, in particular zoning regulations. Such systems are inflexible and hence less responsive to changing urban circumstances. For this reason, the country’s planning law includes a mechanism to create some levels of discretion and flexibility in the planning system. This was made possible by the 1972 Act, which enabled a legal framework for issuing exemptions from land-use regulations.

This act made a committee, known as the Point 5 Committee (the TPC), responsible for examining and sanctioning Detailed Urban Plans and deciding about later changes in these plans. In Tehran, this committee consists of deputies of the Ministers of RUD; Agriculture; Interior Affairs; and Energy; deputies of departments of Environment and Cultural Heritage; and Tehran’s mayor, as the head of the committee. ⁴ The committee has an Expert Working Group, consisting of experts from each of the above-mentioned organizations. This working group examines all submissions and reports the case and their recommendations to the TPC, so the latter can make an informed decision. The TPC’s secretariat is located within Tehran municipality’s bureaucratic system, which compromises the committee’s impartiality.

The level of discretion at the hands of this committee has been the subject of much debate in the country’s planning circles. The 1972 Act did not delineate what ‘changes’ can be accepted by the committee, only excluding those not conforming to the ‘foundations of the comprehensive plans’. Several bylaws and directives were issued in 1984, 1999, and 2015 to define what counts as these ‘foundations’. They made any change of land-use in parcels delineated as public green space and public amenities in the spatial detail plan illegal and considered the overall building density and population cap of Tehran’s administrative districts; changes in per capita area of public amenities; and changes in G zone regulations (zone of public or private green areas) as the foundations of this plan, but remained ambiguous in delineating the threshold of such changes. More importantly, the law failed to delineate what justifications are acceptable for requesting and granting zoning relief. From the outset, Tehran municipality has actively strived to accentuate these ambiguities to provide greater leeway for any future discretionary manoeuvres to increase its revenue.

The TPC’s decisions are subject to relatively little judicial and legislative oversight. These decisions can be overturned either through the Court of Administrative Justice or the High Council of Urban Development and Architecture (HCUDA) in the Ministry of RUD. However, the secretariat of the latter institution, which is the deputy Minister of RUD, is himself a member of the TPC. Therefore, in rare and highly politicized projects overturns have occurred.

The TPC, therefore, allows owners and developers to submit their requests for zoning relief. Such requests are often channelled through district municipalities to the TPC, where decisions are deliberated on a case-by-case basis. Looking to expand its revenue through development levies, the Tehran municipality is inclined to consider such applications approvingly. This mechanism is another example of planning mechanisms, where the resource-rich can benefit from and expedite the process of zoning relief (e.g. Fischer et al., 2022). Yet, I will argue that the TPC provides an example of state capture, where the provision of accommodations and concessions mainly align with and pursue both the economic and political interests of Bonyads and military organizations.

Methods

To explore the economic and political drivers of the TPC decisions, the research proceeded in the following steps. In the first step, I collected and profiled all decisions of the TPC that related to identifiable parcels in Tehran since 1987, when these decisions were published on the TPC’s Web site. Then, I focused on decisions made from 2009 to 2019 (642 sanctions), since the Detailed Plan of Tehran had been prepared and was available to the TPC in 2008. I assembled a database of these 642 relief applications, which includes data on submission year, parcel characteristics such as location, size, and existing land-use; as well as parcel’s zone; land-use regulations at the time of decision; type of zoning relief requested by the owner; other organizations mentioned in the document (like courts); The recommendations of the working group and the decision of the TPC. Then I located these parcels in QGIS to identify the spatial patterns of granted zoning relief. Furthermore, the data on all building permissions of the sanctioned projects were scrapped from the Tehran Municipality Web site.

In the second step, I gathered qualitative data about the internal mechanism of the TPC by conducting interviews with the working deputy of the TPC; one former member of the TPC; and one working member of the TPC expert working group. I have also interviewed two high-end developers in Tehran. All interviews were recorded and transcribed or handwritten where the participant declined the interview being recorded.

In the third step, to understand the political forces behind the TPC decisions, I went through an exhaustive review of the archives related to 14 major high-end projects with significant zoning relief during the studied period. I have reviewed 2388 documents and correspondence belonging to these projects. By examining these documents, I sought to identify the involved institutions, such as developer companies and the financial holdings behind the project; their other projects or joint ventures and hence pinpoint the main entities behind these front companies. Finally, wherever possible, I traced the individuals involved in these projects as former and current owners; CEOs, or members of the boards of directors in these and their related companies, using an online database ⁵ and the official websites of these projects and companies to corroborate the findings for these 14 projects.

The TPC and legalizing non-conformity

In the coming sections, I will argue that the TPC provides an example of a planning institution captured by the political elites. Instead of serving as a safety valve to make plans feasible and implementable, it works as a regulatory fix that institutionalizes differentiated access to the possibilities of LBA for the politically powerful actors. In doing so, first, I show how the TPC sanctions shape and distribute opportunities for value extraction from urban development. Second, I argue that shaping and distributing these opportunities do not solely pursue the obvious economic goals of increasing the municipality’s revenues. Third, and through the examination of the selected cases, I argue that Bonyads and military organizations cluster around the TPC and orchestrate land-based accumulation through this mechanism to the detriment of the public good.

Zoning relief and shaping rent-gap

Table 1 provides an overview of the TPC decisions in the studied period. In this period, the TPC sanctioned the construction of 359 projects with increased density or number of stories and 169 projects with land-use different from what was allowed in their respective zones. Only in 49 cases, the decision can be justified based on providing flexibility to make the Detailed Plan implementable. Almost one-fourth of the approved proposals were high-end, high-rise (according to the law, 12 stories and above) residential buildings. The rest were shopping malls, private office buildings, hotels, and private hospitals. According to a member of TPC’s expert working group, the majority of these requests were justified on the grounds of ‘a lack of urban landmarks in the neighbourhood’.

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Table 1.

Description of the data on the TPC decisions on zoning relief requests.

Time of the decisions	Number of applications	Relief applications located in districts 1–3	Changes to make the plan implement-able a	Previous land-use being garden a	Projects located in G zone a	Land-use change a	Increase in density and stories a	Land-use change in parcels with specific land-usea,b
2018	19	6	0	0	0	5	2	4
2017	18	13	0	5	1	5	10	5
2016	39	26	0	13	5	15	29	12
2015	69	37	2	14	8	26	44	18
2014	78	61	0	20	6	17	49	13
2013	56	40	0	17	5	7	45	6
2012	84	40	2	12	5	15	61	10
2011	83	44	2	9	6	35	54	26
2010	108	46	25	13	4	23	38	13
2009	88	42	18	8	3	21	28	14
	642	355	49	111	43	169	359	120

^aNumber of projects sanctioned by the TPC.

^bLand-use specified in the detail plan is public park; parking; educational; sport or cultural facilities; or reserve land.

The TPC decisions, therefore, can be analysed through the calculations of rent gaps. By increasing density and height, or changing land-use to a more profitable one, the TPC decisions created and widened the rent gap to the benefit of landowners, developers, investors, and realtors. For usual landowners and developers, the capitalized ground rent often reflects the expected potential ground rent after redevelopment, so the actual and potential ground rent gets closer (Clark, 1995; Slater, 2017). However, if a land buyer expects that the TPC will grant him/her a higher development regime, this gap will be considerably pronounced. Examining the submitted applications also shows the speculative nature of using this mechanism. In the studied period, the average number of requested building stories was more than 17, on average 10.55 stories more than what was allowed in their respective zones. Applicants seem to speculate on gaining more profit by requesting a regime of development even higher than what they aimed to build, so if the committee lowered the number of stories, they still reached their desired outcome.

Furthermore, the spatial distribution of these projects presents a clear pattern (Figure 1). Tehran’s northern areas are located on the foothills and enjoy a moderate climate compared to the semi-arid southern areas and hence have been historically settled by the wealthiest groups. The property price in Tehran, therefore, follows a north-south pattern, with districts 1 and 3 having the highest land prices in the metropolitan area. The spatial distribution of the sanctioned projects reflects this pattern, highlighting the relevance of location at the metropolitan scale in the creation of the rent gap (Hammel, 1999; Ward and Aalbers, 2016). A change in the development regime for a parcel in the most expensive areas creates a much higher rent gap compared to a similar change in lower-price areas. In the studied period, over half of these projects were located in districts 1 and 3. Even within these districts, these projects were concentrated in branded locations. At the same time, the least expensive districts have few or no projects (e.g. District 19) sanctioned by the TPC.OPEN IN VIEWER

Figure 1.

Location of the projects with granted zoning relief in Tehran’s districts.

To sum up, the TPC decisions were not aligned with its initial mission of making the spatial plans relevant and implementable. Many of these decisions were made based on a calculated misreading of the laws and generated considerable economic returns. The next sections examine whether or not the TPC’s function can be explained solely by economic drivers.

Conclusion

In this paper, I focused on the TPC as one component of the planning system in Tehran, which ceased to work as a ‘safety valve’ (Valverde, 2011) for planning implementation and instead was repurposed by predatory and extractive assemblages of Bonyads and military organizations to act as a malleable and short-term oriented institution with long-lasting consequential outcomes for the public good. The paper departed from focusing on the TPC as reflecting a local variation of neoliberalism since as argued by Steel et al. (2017), it was an inadequate explanatory framework to capture the complex relations between the actors involved in the manipulation of planning institutions to create, facilitate, and intensify LBA. In line with Ong’s (2006) argument, the case of TPC showed that neoliberal calculations and policies - such as making exceptions and exemptions to maximize LBA – are introduced in different political systems as exceptions to ‘political business as usual’ not necessarily as drivers of totalizing changes. This and other studies that foreground the local political dynamics in examining LBA (e.g. Wu et al., 2022; Yeşilbağ, 2022) show that neoliberal policies are often cherry-picked and used to concretize the political system as usual.

Political distortions, such as state capture, are critical in sustaining and expanding distorted LBA. Hence understanding local political actors and their operations is essential in understanding the politics of LBA. Therefore, the paper draws attention to the susceptibility of the planning systems to be a target of state capture under circumstances of political distortions, due to the role they can play in extracting and distributing high rents from urban development. Particularly, those components of planning systems with discretionary powers are more prone to political capture. The manipulation of such mechanism has been also raised by a rich critical literature in the global South as well (Kim, 2020; Liong et al., 2020; Shih et al., 2018). However, this literature mainly rests on a state/market dichotomy, which renders invisible other actors and their intermeshed economic-political stakes in using, manipulating, or completely appropriating these components. For instance, the involvement of actors like the military in Egypt (Sayigh, 2021) and political parties like Hezbollah in Lebanon (Fawaz, 2017) in real estate and planning highlights the need for attending to the historicity of the formation of the state vis-a-vis these actors and the market.

Scholars of urban studies and political distortions seem to have much to gain from a dialogue between the two bodies of literature. The latter can provide helpful lenses for exploring the various forms and roles of the political drivers in urban development in different contexts. Urban scholarship, in return, can offer a fertile ground to examine and explore variegated forms and operations of political actors in accessing and expanding economic resources from urban development. In Tehran, the legacy of the revolution and three decades of ‘economic liberalization’ shaped a different formation and level of state capture in the planning system. While the literature often discusses the state capture by private actors, political parties, or families (Bracking, 2018; Innes, 2014), in our case the military organizations and Bonyads have coalesced into a peculiarly Iranian variety of state capture, one that involves capturing and repurposing the TPC as a component of the ‘formal’ state to create and exploit skewed possibilities of LBA.

Finally, by employing the lens of state capture, I also aimed at exposing and politicizing the predatory aspects of urban governance in the context of the unchecked exercise of state power in spatial planning. In addition to attending to the states’ manipulation of regulatory functions to promote and facilitate LBA by the private sector (e.g. Karampour, 2021), this lens underscores how powerful political actors steer the circuits of capital and exploit rent opportunities latent in urban land to achieve economic power and maintain political stability. Looking at political distortions provides an expanded framework to politicize actions of the states in the systematic provision of accommodations and concessions in planning systems for the powerful actors.