It was an edgy part of London, a hipster heaven for artists and clubbers. Now big money is moving in and taking over

It is the home of hipsterism, the birthplace of a thousand bushy beards, but has Shoreditch outgrown its cool? Has it become an urban victim of its commercial success? It’s a familiar cycle: a neglected inner city neighbourhood is colonised by artists, a cafe culture flourishes, new businesses move in, then rents go up, and the original inhabitants who gave the place its character are priced out of the area.

This week sees the closure of the Red Gallery, the idiosyncratic event space, and its sister establishment, the symbolically titled pop-up food and music venue, Last Days of Shoreditch. They are to be cleared away for the construction of an 18-storey, 300-bed hotel by upmarket chain Art’otel, by the multinational Park Plaza group.

As if marking the passing of an age, Hackney council, going against the findings of its own consultation process, announced an extension of the special policy area in Shoreditch that makes it harder to open new bar premises. It also brought in across-the-borough restrictions on opening hours, with midnight curfews for all new venues.

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“It’s the Leicester Squarification of Shoreditch,” said Jonathan Downey, the owner of Dinerama, one of the area’s popular street-food markets.

That’s a sentiment echoed by Yarda Krampol of Last Days of Shoreditch. “Hackney Council are following an agenda of cultural cleansing,” he said.

But on the streets of Shoreditch and nearby Hoxton, it was hard to find many skinny-jeaned groovers crying into their flat whites. The place was still thrumming with energy, or at least a lot of attractive young people walking from bar to cafe to boutique and back again.

When I worked here in the late 1980s and early 1990s, it was something of a cultural and culinary desert. Back then, only a raver who’d taken too much ecstasy would have predicted that the area would house a Versace shop, as there is now on Redchurch Street. There were just a few greasy spoon caffs, one half-decent pub and a car wash (which is still there). That was pretty much it for daytime entertainment. At night, there was the Bass Clef, a surprisingly sophisticated jazz venue for the time (it served food!) that seemed to have been plonked down from another universe.

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“You’d go there and you could smell the future,” says the Red Gallery’s founder, Ernesto Leal.

And aside from that, there was the rather outlandish gay bar, the London Apprentice, which drew a number of celebrities like Freddy Mercury to east London. But the rest was an eerie silence.

By then, as Leal recalls, artists and photographers had already moved into the studios vacated by the departing textile and tailoring businesses. In 1993, a group of Young British Artists, including Tracey Emin, Gavin Turk and Gillian Wearing, took part in a Fete Worse than Death in Shoreditch, in which they sold their wares on stalls, as though they were at a village fete.

Facebook Twitter Pinterest Shoreditch was famous for its Young British Artist residents, such as Tracey Emin. Photograph: Johnny Green/PA

Leal would rent spaces for illegal warehouse raves from photographers, or sometimes just break into empty ones. “I can’t even think in those terms anymore,” he said, leaning back in his cramped office. “But they were exciting times.”

That kind of edginess has little place in the now thriving and increasingly wealthy area. Instead, there are plush, ironic versions of a furtive underworld, in which clientele have to say a password or go through a wardrobe door to enter artfully hidden cocktail bars. But, as Leal points out, it would be wrong to look back with any great nostalgia. Not only was it hard to buy a pint of milk, there were so few local shops, but the area was also infamous for its far-right politics. The National Front’s headquarters were on Great Eastern Street until the early 1980s. At that time, I was going to college in Shoreditch, and I remember the local pubs were not always welcoming.

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“There was still a big white working-class community,” said Leal – whose parents escaped from the far-right in Chile – when he first came to Shoreditch from Edinburgh in the late 1980s, “and you’d still see evidence of fascists around in pubs”.

But several factors helped transform Shoreditch. Far-right politics were roundly defeated. And Downey believes that Westminster council’s decision at the turn of the millennium to restrict bars in Soho and Covent Garden helped create the need for a new social quarter. “All of the up-and-coming bar owners came east,” he said. Around the same time, tech businesses arrived and the area around Old Street was dubbed Silicon Roundabout. It was, after all, the cross fertilisation of bespoke bar culture and tech-savvy millennials that produced the particular genus of homo sapiens we now know as “the hipster”.

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Inevitably, the species has evolved over the years. In his sharp suit and with a hairless face, Imran Younus doesn’t look a classic of the type. But the marketing company executive seems completely at home in Shoreditch, a neighbourhood “that has a little place for every type of person”. He disagreed that it had lost any of its dynamism or creativity.

Not far from the Versace shop, I meet Tim Traynor, who – with his full and perfectly coiffed black beard and dark sunglasses – looks like the platonic ideal of hipsterism. He’s even a marketing manager for a specialist brewery. Originally from New York, he saw his old neighbourhood of Brooklyn go through the same process as Shoreditch.

“The good thing about cities like New York and London is that the cool places move on. If you get tired of the white-guy-hipster thing, then there are other layers of the onion to pull back,” he said.

Although sad to be evicted from Shoreditch, Krampol thinks he and his partners might take their community-flavoured project elsewhere. “Maybe Deptford,” he said. “There are loads of interesting things happening around there. Tottenham is quite nice as well. Ten years ago, I never thought I’d be looking for spaces in Tottenham. But here we are.” Tottenham, you’ve been warned. The hipsters are coming!