Four ways cities are investing for success

Innovative cities are tackling common problems and becoming increasingly competitive

November 04, 2019

San Francisco, Singapore, and Berlin might be world famous but they’ve never had more competition in attracting businesses and talent.

That’s because other cities – in China and East Asia, in particular – are giving more established metropolises a run for their money across infrastructure improvements, pollution control and even living standards.

“In Europe and the U.S. we have legacy city models that are difficult to change, whereas emerging cities can respond to new ways of living and working much faster,” says Jeremy Kelly, global cities research director, JLL.

Guangzhou, Shenzhen, Istanbul and Taipei are among the emerging world cities to watch, according to JLL’s Demand and Disruption report.

Large populations of young people are contributing with their capacity for innovation, and these cities are making significant strides in tackling common problems that plague urban environments, like congestion and poor transport links.

Here are four areas that these cities are investing in for success. 

1. Upgrading public services

Cities in emerging markets need to absorb massive growth and improve efficiency across a range of public services, from transport to sanitation. To do this, they’re increasingly turning to smart technology.

“China is at the forefront of using smart technology to improve public services in a way that has a meaningful impact on quality of life in its major cities,” Kelly says.

For example, Alibaba, China’s technology giant, developed City Brain – an artificial intelligence and data-processing platform – to help urban planners and city officials upgrade their public services. It was trialled in Hangzhou as a traffic management tool in 2016 and has since been adopted in Beijing to monitor air pollution. Companies are also using City Brain for sewage management and environmental evaluation.

Across the water in Taiwan, Taipei is leading a global network of smart cities that are working together to build an online platform for sharing information and resources, known as the Global Organisation of Smart Cities (GO SMART). 

2. Tackling sprawl and congestion

Asian cities top the league table when it comes to congestion scores and, in cities like Jakarta and Manila, chronic congestion can be a major inhibitor to their long-term success.

“In such fast-growing, densely populated markets, there are real challenges in getting to downtown areas, so real estate growth relies on decentralisation of commercial activity into satellite hubs,” Kelly says.

In Singapore, Lendlease’s urban regeneration project in the Paya Lebar area is one example. The multi billion-dollar project includes three office towers, residential towers and a shopping centre. It provides jobs closer to homes, cuts congestion and reduces commute times.

In China, bike sharing is helping to reduce congestion in major cities thanks to a wave of start-ups that have expanded such services rapidly and on a huge scale.

3. Building infrastructure and transport networks

“Many Asian cities are playing catch up in terms of infrastructure development,” says Kelly.

However, innovative, integrated transport networks are opening up new corners of the region for business.

China’s massive Greater Bay area infrastructure project links Hong Kong, Macau and nine cities in southern China to create the world’s biggest Bay Area economy.

Already, two major infrastructure projects have launched – the world’s longest sea bridge between Hong Kong and Macau, and the express rail link between Hong Kong and the Guangdong Province – cutting travel times significantly between China’s mainland and Hong Kong.

Infrastructure projects like these are propelling the fortunes of the cities they capture. Shenzhen now ranks inside JLL’s top 10 global cities across infrastructure benchmarks, ahead of Berlin, New York and Stockholm.

Meanwhile, Guangzhou may be benefiting from closer connectivity with Hong Kong but it has also adopted its own electric transport system, electrifying more than 90 percent of its bus network.

Elsewhere, Istanbul has welcomed a huge new airport, which is tipped to become one of the world’s largest transport hubs.

4. Fighting pollution

High profile initiatives to combat Asian cities’ pollution problems have hit the headlines, including China’s smog eating tower. It remains to be seen whether such projects can deliver meaningful impact at scale but Chinese cities, in particular, have seen a reduction in levels of air pollution in recent years since the government made it a policy priority.

Shenzhen is one city taking steps to fight pollution through the use of electric vehicles and buses across its transport network.

Recycling is another area ripe for improvement in many cities where policy and provision for waste management and recycling is often lacking. Taipei is a global recycling success story. Dubbed “Trash Island” in the 1980s and 1990s, government regulations made people and businesses accountable for their waste.

South Korea is the world leader in food-waste recycling thanks to policy, smart bin technology, and the introduction of urban farms.

The sustainability of the region’s real estate industry is coming into question, however, as rapid development and a constant turnover of stock means buildings rarely reuse materials and recycle.

“The waste from rapid obsolescence in Asia Pacific’s real estate stock is astounding,” says Kelly. “Building at this rate is absolutely unsustainable and it’s only just becoming a critical point in Europe where developers and investors are thinking about the circular economy.”