Souvenir shops, bars and cafes now outnumber the art galleries and studios in Tianzifang. Yu ran / China Daily

In 2008, the government took over Tianzifang and shifted the focus from developing the place into an art and culture hub to commercialization, security and property management.

As one of the first shop owners to arrive on Lane 274 in 2007, Yan Hongliang, who sells ceramic art designed and produced in Jingdezhen, Jiangxi province, has witnessed the tremendous changes that have taken place since.

The one that made the most impact is rent.

At the beginning, Yan only had to pay around 6,000 yuan a month for his 60-sq-m shop. He is now paying 40,000 yuan and said that the rent will exceed 60,000 yuan after his current contract expires in two years.

Having already struggled to break even in the first few years of his business, the exorbitant rent now has made doing business in Tianzifang unrealistic.

"The pressure caused by the booming real estate market has sped up the commercialization of Tianzifang. The place is now filled with more tourism-related items instead of original art works," said Yan, adding that he plans to move out of Tianzifang after fulfilling his rental contract despite his attachment to the area.

"The rent has been increasing but the prices of goods have remained low. It's no surprise that many talented artists are leaving the area," said Zhou Xinliang, the resident of Tianzifang.

According to sociology professor Yu Hai, there are currently 586 shops in the area. Over the past five years, retail outlets have steadily replaced the art studios and galleries, which now account for just 2 percent of the shops in Tianzifang. In contrast, about 20 percent of the units are clothing stores.