The term “smart” can be a prefix for a whole host of things: phones, motorways, tickets, cards, buildings. And also cities, many of which are making concerted attempts to become smarter as a way of generating a range of economic, social, cultural and other benefits for residents, visitors and businesses. But what exactly is a “smart city”?
CBRE recently co-sponsored a major global research study entitled Smarter Cities 2025 Building a Sustainable Business and Financing Plan, carried out by ESI ThoughtLab. The report was launched on November 13th and the various outputs can be found here.
The study analysed the “smart” credentials of 136 cities across the world, and categorized the cities into “beginner”, “transitioning”, and “leader” stages of smart city maturity. Since the term” smart” is itself a very broad description, the study assessed cities across ten specific elements of smart city development: governance, economy, infrastructure, talent, funding, mobility, environment, public safety, public health, and payment systems.
Cities are at very different stages in this journey and there is wide variation in the level of priority, degree of sophistication and exact focus of smart city initiatives. Cities mostly see liveability enhancements – such as improved safety and better infrastructure – as the main benefits, but they expect revenue and financial benefits to feature more strongly as their efforts progress. Uncertainty about the ROI of specific programmes is a widespread concern, or even an inhibitor, and can make it difficult to select among different possible approaches. Sharing the experiences and challenges of the “leader” cities ought to help those at an earlier stage to pursue profitable routes. Nothing wrong with learning from others’ mistakes!
- Smart investments trigger a virtuous cycle of economic growth by generating capital for new smart city investments and attracting businesses, residents, tourists, and talent.
- To achieve those catalytic impacts, cities need to build a clear path to a smart city future.
- With digital technologies evolving at speed, cities need to conduct frequent feasibility checks on their plans and be prepared to adapt.
- Data is the fuel for smart city transformation, and cities need to make data management a core area of excellence.
- Spending on smart programs rises with smart city maturity.
- The future of mobility will be multi-modal transportation systems interconnected through smart technology.
- Civic leaders see the environment as the top challenge to address through smart city programs, and improved public safety and health as the main benefits of current smart initiatives.
- Funding smart city solutions is a key challenge for most cities.
Smart city initiatives intersect with lots of areas that are highly relevant to CBRE clients, including city planning, infrastructure, energy, placemaking, smart buildings, technology innovation and regeneration. In raising the amenity and efficiency of cities, smart city initiatives have the potential to boost property values in specific areas, or even to raise the economic status of an entire city. Getting alongside city authorities at the planning stage and working to understand – or, better still influence – the impacts of smart city initiatives will be to the advantage of forward-looking owners and occupiers.