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Tourism-driven development in coastal regions has long been heralded as an economic boon, fostering job creation, infrastructure improvements, and cultural exchange. However, the unchecked expansion of luxury tourism and real estate speculation can also trigger gentrification, displacing local communities, and reshaping cultural and environmental landscapes. This case study explores the parallel impacts of tourism-driven gentrification in Newport, Rhode Island, and Bali, Indonesia, revealing broader patterns of environmental injustice and economic exclusion.

Coastal Gentrification in Newport, Rhode Island

Newport, known for its Gilded Age mansions and picturesque coastline, has experienced significant tourism-driven gentrification. The rise of luxury developments, short-term rentals, and increasing property values has placed mounting pressure on long-term residents. According to the Newport Housing Study Public Engagement Survey Results, housing affordability is at a critical juncture, with limited options for middle and lower-income residents (Newport Planning Department, 2024). The transformation of residential spaces into short-term vacation rentals, like Airbnbs further exacerbates the crisis, pushing locals out of historically rooted neighborhoods. Properties that were once affordable to working-class families have also been converted into high-priced condominiums, and many historic homes are now being repurposed as luxury rentals catering to seasonal tourists rather than year-round residents. This shift has fundamentally altered the city’s demographic, eroding the sense of community that once defined Newport’s coastal neighborhoods.

Beyond these socio-economic consequences, the environment bears the brunt of tourism-driven expansion. The famed Cliff Walk, a prime attraction, is steadily eroding due to increased foot traffic and climate-induced sea level rise. Reports from the Providence Journal highlight the growing costs and uncertainty of preserving the landmark as sections crumble into the ocean. Additionally, storm surges and worsening coastal erosion threaten historic properties along the shore, putting further strain on city infrastructure. Meanwhile, the expansion of luxury waterfront properties and high-end marinas has altered the natural coastline, disrupting marine habitats, and increasing pollution levels in Narragansett Bay. Water quality has been further compromised by the proliferation of large-scale tourism events, which contribute to excessive waste generation and runoff into nearby estuaries.

Newport’s real estate market is heavily influenced by out-of-state investors who see the city as a lucrative vacation rental hotspot. This has driven up property values to the extent that many lifelong residents can no longer afford to stay. The tourism economy, once based on a balance of seasonal and year-round activity, is now heavily skewed toward high-end consumers, with an increasing focus on luxury experiences rather than preserving the city’s historic charm.

While tourism is an essential economic driver, its unchecked growth has led to a widening wealth gap and the prioritization of profit over the well-being of Newport’s working-class and middle-income residents.

Tourism and Environmental Degradation in Bali, Indonesia

Bali, like Newport, has witnessed rapid tourism expansion, leading to the gentrification of coastal communities. Once characterized by traditional agrarian landscapes, regions like Canggu and Ubud are now dominated by luxury resorts, “expatriate-owned” villas, and commercialized tourism hubs. According to Suyadnya, tourism gentrification in Bali has displaced local populations, driven up living costs, and eroded cultural heritage. The influx of foreign investors and digital nomads has pushed property prices beyond the reach of many local Balinese families, forcing them to relocate further inland or abandon their traditional ways of life. Small businesses that once catered to locals are now replaced by high-end boutiques, trendy cafes, and Westernized entertainment venues, diminishing Bali’s cultural heritage (instead of supporting its authenticity).

The environmental consequences mirror those seen in Newport, despite being on the other side of the globe and an altogether different climate region.

Unregulated tourism development has led to deforestation, coastal erosion, and increased water consumption, threatening Bali’s fragile ecosystems. The proliferation of beachfront hotels and commercial centers has disrupted marine habitats, contributing to rising pollution levels in estuaries and coral reef degradation. A recent study by Utama et al. underscores how over-tourism has compounded socio-economic inequalities while placing unsustainable demands on local resources. Mass tourism in Bali has also led to severe water shortages, as luxury resorts consume significantly more water per capita than the local population, leading to a depletion of natural aquifers and saltwater intrusion into freshwater sources.

Bali’s real estate boom has been fueled by speculative investors eager to capitalize on the island’s global appeal. Beachfront properties, once home to fishing communities, have been transformed into high-end villas and exclusive resorts, creating stark economic divides. While tourism has brought financial opportunities, it has also marginalized those who do not benefit directly from the industry. Many local residents now struggle to find affordable housing, as rental prices have skyrocketed due to the growing demand for short-term accommodations. The increase in traffic congestion, air pollution, and waste generation has further strained Bali’s already fragile environment, prompting concerns about the long-term viability of its tourism-dependent economy.

Broader Implications: Environmental Injustice and Economic Exclusion

The cases of Newport and Bali illustrate a broader trend: when tourism development is prioritized over sustainable planning, both social and ecological crises emerge. Rising property values, short-term rental markets, and luxury developments disproportionately benefit investors and high-income newcomers while displacing lower-income residents. Simultaneously, environmental degradation—from eroding cliffs in Newport to deforested coastlines in Bali—underscores the fragility of these tourism-dependent regions. As both destinations grapple with these challenges, it becomes evident that unchecked tourism is not merely a local issue but a global one, requiring systemic change.

Unchecked tourism growth reinforces patterns of environmental injustice, where local communities bear the burden of economic exclusion while suffering from the degradation of their own land. In both cases, equitable policy interventions are necessary to balance tourism-driven prosperity with long-term environmental and social sustainability. In Newport, stricter regulations on short-term rentals, expanded affordable housing initiatives, and coastal preservation projects could help mitigate the adverse effects of tourism gentrification. In Bali, a shift toward regenerative tourism—emphasizing community-led initiatives and environmental conservation—may provide a more sustainable alternative to the current model.

Converging Currents: Coastal Futures in Crisis

The experiences of Newport and Bali, although coasts apart, both serve as cautionary tales of unchecked tourism and coastal gentrification. Without strategic policy measures—such as affordable housing initiatives, sustainable tourism regulations, and stronger environmental protections—these destinations risk losing not only their cultural heritage and authenticity but also their natural environments, both aspects of what draws so much tourism int the first place. A more inclusive approach to tourism development is essential to prevent further displacement and ecological harm, ensuring that both local communities and natural habitats may have the capacity to thrive in the face of increasing global tourism pressures. As tourism continues to shape coastal economies, policymakers and stakeholders must prioritize long-term sustainability over short-term profits to foster equitable and resilient coastal communities.