In the last years of the 20th century, the situation in Somerville stabilized and growth returned—first to West Somerville, and then the rest of the city.
Almost thirty years after passenger rail service to Somerville was halted, the Red Line Northwest Extension reached Davis Square in 1984. The city and community used the creation of the new station as a catalyst for revitalizing the faded square, promoting new commercial development and sponsoring other physical and infrastructural improvements. However, when the new transit station opened, business around Davis Square did not immediately thrive. The number of retail stores in the area declined from 68 in 1977 to 56 in 1987. However many non-retail uses, such as beauty salons and real estate offices, had already begun to fill the empty retail spaces. With the Boston area's emergence from its long recession, the area truly began to revive. Clearly, the community's vision of a rebirth of commercial and retail activity has, in the past few years, been fully realized. All benefit from their proximity to the MBTA station, as retail vacancy rates around the square are close to zero.
The telecommunication and biotechnology booms of the mid-to-late 1990s significantly contributed to Somerville's revitalization. As with the housing boom a century earlier, the sudden increase in the number of jobs available in the cities of Somerville, Boston, and particularly Cambridge – as well in as the other communities immediately surrounding Somerville – led to a new surge in the demand for housing. Additionally, the end of rent control in Cambridge coincided with the economic recovery in 1995, increasing demand for Somerville's affordable housing options.
Until the 1990s, Somerville was known for its blue-collar residents and its reputation for crime, especially in the city's east, where the Winter Hill Gang was based. The city also had a very high car theft rate, once being the car theft capital of the country, and its Assembly Square area was especially infamous for this. However, after the gentrification period the city went through in the 1990s, and an influx of artists to the area, this name has mostly faded from use and the city has instead gained a reputation for its active arts community and effective government, including being named the best-run city in Massachusetts in 2006. Nowadays lobbying by grassroots organizations is attempting to revive and preserve Somerville's "small town" neighborhood environments by supporting local business, public transit and gardens.
Davis Square Video from Mary Calnan on Vimeo.