When Latvia regained independence in the early 1990s the type of society rapidly went from a centrally planned economy to a western-influenced market-based economy. Since then the transition has offered significant opportunities for economic growth, service expansions and technological innovation, but it has also experienced rapid social polarization, poverty and environmental degradation. Poverty, which was relatively concealed during the Soviet period, has today become socially visible in the Latvian capital Riga. The increasing inequalities also reflect housing allocation and the spatial distribution of wealth and poverty. The city of Riga has recently emerged as a bustling quasi-metropolis with new and exclusive dwelling complexes for a growing upper-middle class. In contrast to the Soviet era, Supply and demand today typify the new order. In this chapter I discuss the transitional period with its Substantial changes in the political, economic and societal structure by emphasizing time and space and how these two concepts affected urban renewal and spatial differentiation. Namely, the endeavour to transform Riga into a 'western' metropolis will most likely show the way to a well-defined segregation between wealthy and poor areas.