John D. Macomber

Senior Lecturer of Business Administration

Unit: Finance

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John Macomber is a Senior Lecturer in the Finance unit at Harvard Business School. His professional background includes leadership of real estate, construction, construction services, and information technology businesses. At HBS, Mr. Macomber is engaged in the Business and Environment Initiative and Social Enterprise Initiative. He teaches Finance, Real Estate, Urbanization, and Entrepreneurship courses in the elective curriculum and in Executive Education. He is the former Chairman and CEO of the George B H Macomber Company, a large regional general contractor; and remains a principal in several real estate partnerships.  John serves or has served on the boards of Young Presidents Organization International (YPO), Boston Private Bank, Mount Auburn Hospital, and Vela Systems.

Courses include: "Real Property Asset Management," "Real Estate Development, Design, and Construction," and "Sustainable Cities: Urbanization, Infrastructure, and Finance." He is part of the teaching team for "Field Course: Innovation in Business, Energy, and Environment". He is chair or co-chair of Executive Education programs including "Real Estate Management," "Real Estate Executive Seminar," and "Develop India: Real Estate Strategies for Growth."   Mr. Macomber also teaches "Economics, Strategy, and Sustainability" at the Harvard Design School. Prior to coming to HBS, John was a lecturer at MIT in Civil Engineering and Real Estate.

Mr. Macomber is a graduate of Dartmouth College (Mathematics in the Social Sciences) and Harvard Business School.

Featured Work

  1. Are Smart Cities Empty Hype?

    Although there is no such thing as a truly "smart city", today's cities do exhibit different degrees of smartness in how they are designed, developed and run. These differences have real consequences for global society. With a global urban population estimated to top 6 billion by 2050, the world needs cities that are liveable, competitive and sustainable—environmentally, financially and socially. 

    The most effective smart-city initiatives are focused on the fundamentals: the flow of water, electricity, cars and people. Today, old and new cities alike are struggling in these areas, particularly as natural and financial resources become ever scarcer. 

  2. The Fantastic Horizon: How to Invest in a New City

    Rapid urbanization and rampant resource scarcity pose problems – and opportunities – for businesses and governments all over the world. The world’s existing population centers cannot absorb all the migration, prompting the need for hundreds of new cities. This raises the question of who can best lead the building and developing of these municipalities. One course of action is development, promotion, and regulation by the private sector. Harvard Business School Senior Lecturer John Macomber discusses the keys to making this model work, based on his recent investigative visits to nascent privately-funded municipalities in Saudi Arabia and Vietnam.

     

  3. Making a Big Impact in a Big Hurry

    In our lifetimes, the number of people living in cities will more than double – growing to over six billion, according to UN projections.  The world already faces shortages of water, electricity, clean air, land and food; too much garbage, too much dirty air,  and too much time wasted in transit.   Rapid urbanization will only make this situation worse.  What is to be done?

    Many people hope that “better government” will address these problems  -  where politicians wake up and suddenly applying long term thinking based on evidence and logic to make fully funded investments that benefit all of society.    I’m a skeptic – I don’t think governments will be able to do this.   All over the world, governments are stuck politically (like the US and India) or they are out of money for public investment (like China and Indonesia).

    This means that private companies and investors have both an obligation – and an opportunity -  to do something big.  I’m interested in how firms and bankers use sophisticated financial tools  – coupled with connected technologies – to build businesses that make money and which make a difference in sustainable cities.

    Here’s how.

  4. Investing in Sustainable, Competitive Cities

    (Q&A with the editor of Metropolis magazine)
    Best practices going forward will, in my view, be driven by a couple of important concepts.  First, thinking about multiples of buildings (instead of one at a time) will have multiple levels of impact. For example, a minor innovation might be exterior sun- screens on a Houston office tower. But the tower stands alone without benefit of shade from other buildings, and everyone drives miles to and from the tower. The big opportunity for multiple layers of energy savings and impact thus lies in situating buildings where they shield each other from solar gain, they benefit from breezes, and where they are close enough together to allow for comfortable walking or mass transit. Some of the most successful cities in the world are very dense and efficient in this way; for example Hong Kong, Singapore, Tokyo, London, and New York.

    Second, much discussion of sustainability revolves around “more supply:” for example, more electricity from renewable sources.  The other side of the equation should be around “less demand:” or more benefit from using fewer inputs.

  5. Stop Talking About the Weather and Do Something

    The wrath of Hurricane Sandy has illuminated a fundamental question: How do we ensure that our cities are resilient in the face of inevitable future disasters? A destroyed city is not a sustainable city. I'm making the case that it's time to stop complaining about climate change. It's time to stop waiting for the government. It's time to stop spending a lot of money on cleanup after the fact. Rather, it's time for the private sector to take action around adaptation and prevention. My work in sustainable urbanization indicates that we can connect engineering, environment, infrastructure, and private finance to invest in cities that are sustainable, competitive, and resilient.
  6. VIDEO: Harvard Business School at the Kumbh Mela

    Every 12 years Hindu pilgrims gather at the confluence of the Ganges and Yamuna rivers in northern India to bathe in the sacred waters. The gathering, known as the Kumbh Mela, is the world’s largest religious festival, drawing millions of people over 55 days. To accommodate everyone, the Indian government creates a temporary city — building roads and providing power on what is normally an empty flood plain. Harvard Business School Senior Lecturer John Macomber visited the Kumbh in January to discover what such an undertaking can teach us about real estate, urbanization, sustainability, and infrastructure.

  7. Why a Harvard Finance Instructor Went to the Kumbh Mela

    I'm in a winter coat and hat in the January pre-dawn cold and dark, standing on sandbags on a riverbank in the middle of Uttar Pradesh, India. Pilgrims and the faithful and the respectful come to the river this morning by the hundreds, clad in the minimum, praying and splashing and releasing marigold wreaths and rafts of small oil lamps into the river. This is not like any field research I've done before.

     Thirty-five Harvard colleagues and I are at the Kumbh Mela in Allahabad, India, a mass pilgrimage in which tens of millions of Hindus gather to bathe at the confluence of the sacred Ganga (Ganges) River, the Yamuna River, and the mythical underground Saraswathi. Legend says that on his return to the Himalaya, Vishnu flew over this spot and dropped sacred nectar from a pitcher—a kumbh.

    Six months ago this land was under 30 feet of water. Three weeks from now this will become the largest city on earth, the largest single-purpose gathering of humanity in history. Every 12 years, when the moon and stars are aligned, this becomes the most auspicious spot in Hinduism, and there is a six-week-long festival, or mela, for the millions of pilgrims. The Maha Kumbh Mela is happening right now. It's expected to draw close to 200 million people over almost eight weeks, and as many as 30 million in a single day. The Harvard team is here to learn about why and how.

  8. Building Sustainable Cities

    By 2050 the number of people living in cities will have nearly doubled, to 6 billion, and the problems created by this rampant urbanization are among the most important challenges of our time. Of all resource-management issues, the author argues, water, electricity, and transit deserve the greatest focus. Every other service a competitive city provides—functional housing, schools, hospitals, stores, police and fire departments, heating, cooling, waste management—depends on a reliable infrastructure for those three resources.

    Many corporations and investors assume that fixing cities is the purview of government. But governments around the world are stuck—financially, politically, or both. Implementing solutions to the problems of urbanization requires large amounts of capital, exceptional managerial skill, and significant alignment of interests. All these abound in the private sector.

    Thus major opportunities exist for businesses that can create and claim value by improving resource efficiency. The products and services that new (or legacy) cities will require, and that provide the return investors and entrepreneurs need, optimize both technological sophistication and financial sophistication—approaches designed to attract capital by offering different levels of risk and return, different cash-flow priorities, and opportunities for both short-term and long-term investment.

    The author cites a number of companies that have moved toward or into what he calls “the efficiency frontier.” These include Sarvajal, in India, which saves money and eliminates waste by selling direct to customers through its “water ATMs”; the Boston-based EnerNOC, which manages electricity production and consumption to reduce spikes in demand; and EMBARQ, based in Washington, DC, which coordinates the interests of business and government to organize city transit services.

Publications

Journal Articles

  1. Building Sustainable Cities

    By 2050 the number of people living in cities will have nearly doubled, to 6 billion, and the problems created by this rampant urbanization are among the most important challenges of our time. Of all resource-management issues, the author argues, water, electricity, and transit deserve the greatest focus. Every other service a competitive city provides—functional housing, schools, hospitals, stores, police and fire departments, heating, cooling, waste management—depends on a reliable infrastructure for those three resources. Many corporations and investors assume that fixing cities is the purview of government. But governments around the world are stuck—financially, politically, or both. Implementing solutions to the problems of urbanization requires large amounts of capital, exceptional managerial skill, and significant alignment of interests. All these abound in the private sector. Thus major opportunities exist for businesses that can create and claim value by improving resource efficiency. The products and services that new (or legacy) cities will require, and that provide the return investors and entrepreneurs need, optimize both technological sophistication and financial sophistication—approaches designed to attract capital by offering different levels of risk and return, different cash-flow priorities, and opportunities for both short-term and long-term investment. The author cites a number of companies that have moved toward or into what he calls "the efficiency frontier." These include Sarvajal, in India, which saves money and eliminates waste by selling direct to customers through its "water ATMs"; the Boston-based EnerNOC, which manages electricity production and consumption to reduce spikes in demand; and EMBARQ, based in Washington, DC, which coordinates the interests of business and government to organize city transit services.

    Keywords: Growth Management; Urban Development; Entrepreneurship; Infrastructure; City;

    Citation:

    Macomber, John D. "Building Sustainable Cities." Harvard Business Review 91, nos. 7/8 (July–August 2013): 40–50.
  2. The Role of Finance and Private Investment in Developing Sustainable Cities

    Three trends will drive urban investment, development, and entrepreneurship in the next two decades. This article provides tools to identify the situations and circumstances that will be most favorable for private sector involvement in consideration of these trends. The first trend is urbanization. Over the next twenty years, the number of people living in cities will double, with three billion additional urban dwellers. Second, shared resources like clean water, clean air, energy, and places to put solid waste are already scarce and constrained. Urbanization will only exacerbate these pressures. Third, almost no local or national government can mobilize both the capital and the political consensus to make investments in the infrastructure that will lead to more effective use of these resources. There is a largely unrecognized opportunity for the private sector to engage in selective investments that consider these trends. Investors and entrepreneurs can make money by extending these "common good" kinds of items, which use resources more productively. In the winning situations, this makes these cities more economically competitive at the same time. This article further argues for investments grounded in the basics of smart physical configuration. Examples are the compact arrangement of buildings, efficient use of water and power, and deployment of transit that reduces congestion. Investment and urban planning in three Asian cities are profiled as illustrations. Two sample proformas featuring multiple classes of securities illustrate the concepts.

    Keywords: Trends; Demographics; Private Sector; Investment; City; Infrastructure; Opportunities; Urban Development;

    Citation:

    Macomber, John D. "The Role of Finance and Private Investment in Developing Sustainable Cities." Journal of Applied Corporate Finance 23, no. 3 (summer 2011): 64–74.
  3. You Can Manage Construction Risk

    Keywords: Risk and Uncertainty; Construction; Management;

    Citation:

    Macomber, John D. "You Can Manage Construction Risk." Harvard Business Review (February–March 1989).

Cases and Teaching Materials

  1. Ottawa Light Rail Transit Project: Value for Money

    Citation:

    Macomber, John, and Lorraine du Peloux de Saint-Romain. "Ottawa Light Rail Transit Project: Value for Money." Harvard Business School Case 214-088, February 2014.
  2. Delhi-Mumbai Industrial Corridor: India's Road to Prosperity?

    Citation:

    Macomber, John, and Vidhya Muthuram. "Delhi-Mumbai Industrial Corridor: India's Road to Prosperity?" Harvard Business School Case 214-077, January 2014.
  3. Bardhaman (A) & (B)

    Citation:

    Macomber, John D. "Bardhaman (A) & (B)." Harvard Business School Teaching Note 214-025, September 2013.
  4. Kumbh Mela: India's Pop-up Mega-City

    Keywords: India;

    Citation:

    Khanna, Tarun, John Macomber, and Saloni Chaturvedi. "Kumbh Mela: India's Pop-up Mega-City." Harvard Business School Case 214-023, August 2013. (Revised December 2013.)
  5. Urbi and the Pact for Mexico: Vertical and Sustainable Housing

    Citation:

    Macomber, John. "Urbi and the Pact for Mexico: Vertical and Sustainable Housing." Harvard Business School Case 214-013.
  6. Hudson Yards—The Other Side of the Tracks?

    Stephan Ross, CEO of Related Companies, is considering an opportunity to invest $1 billion for the air rights over the Hudson Rail Yards in New York City. The investment would allow Related to build a platform over the operating rail tracks and develop this blighted edge of New York City into one of the top tier places to live, work and shop in the world.

    Keywords: real estate; Property; Growth and Development Strategy; Urban Development; Real Estate Industry; New York (city, NY);

    Citation:

    Gordon, Christopher M., A. Eugene Kohn, John D. Macomber, and Lisa Strope. "Hudson Yards—The Other Side of the Tracks?" Harvard Business School Case 213-040, January 2013.
  7. Living PlanIT (TP)

    Citation:

    Eccles, Robert G., Amy C. Edmondson, John Macomber, and Ryan Johnson. "Living PlanIT (TP) ." Harvard Business School Teaching Plan 413-039, August 2012.
  8. Phu My Hung

    Privately held city development promoters decide whether to partner on next phase or go it alone in a 20-year, 4000-acre project. Set outside of Ho Chi Minh City, Vietnam, this decades-long project led by two Taiwanese families reshaped and built the economic environment of Vietnam's financial capital. The promoters had a long-term vision and left very substantial capital invested for a very long time. This allowed them to follow a master plan that was resource efficient, economically attractive, and environmentally friendly (largely due to major up-front investments in power and water infrastructure). This project was promoted by industrialists with a system view and patient capital, as compared to governments with limited execution capability or real estate investors with limited capital and a shorter time horizon. The dilemma in the case is about whether or not to partner with an outside retail real estate firm in order to reduce execution and lease-up risk in a proposed new shopping mall; or whether to go it alone with the promoters's own capital doing it the promoter's own way. This expands into a discussion of the same historic choices in the project, and whether the promoters realized a below market return for their methodology. The project is quite successful and transformational today, so the opposite question can also be drawn out: is this the preferred means for promoting multiple new sustainable and competitive cities around the world, with long-view private promoters in lieu of government alone and in lieu of real estate developers alone?

    Keywords: Urban Development; Infrastructure; Real Estate Industry; Viet Nam;

    Citation:

    Macomber, John, and Dawn H. Lau. "Phu My Hung." Harvard Business School Case 213-098, February 2013. (Revised February 2014.)
  9. King Abdullah Economic City in 2009: Population Drivers and Cash Flow

    CEO of high profile new economic city in Saudi Arabia must decide how to allocate limited investment funds across projects under duress. Issues include understanding core economic drivers, planning infrastructure investment and return, attracting multinationals, energy policy, sustainability, urban planning, government incentives and regulations. Students must allocate limited funds, or accept outside investors at distress terms, with respect to city center, retail, resort, residential, education, utilities, commercial sale or leased land, worker housing, and a potential seaport.

    Keywords: Urban Development; Infrastructure; Real Estate Industry; Saudi Arabia;

    Citation:

    Macomber, John D. "King Abdullah Economic City in 2009: Population Drivers and Cash Flow." Harvard Business School Case 213-095, February 2013.
  10. Dharavi: Developing Asia's Largest Slum (A)

    Maharashtra state is accepting bids to redevelop Dharavi, the largest slum in Asia. A real estate developer assesses the risks and tenders a bid. The bid conditions include providing new free housing to tens of thousands of slum dwellers, which is anticipated to be paid for from the revenues from developing and selling market-rate housing. While the primary concerns are cost of construction, cost of capital, and revenues from sale of units, the analysis must consider many aspects of risk including political risk, foreign exchange risk, market risk, and execution risk. Further, the discussion covers social aspects including whether the slum should be redeveloped at all, whether it should be redeveloped by government or by the private sector, and whether to accomplish it in large chunks or in smaller increments. Additional topics that can be covered include consideration of what happens to commercial activities formerly run from slum dwellings, whether the market-rate units will indeed sell for high prices if there are tens of thousands of former slum dwellers housed nearby, and whether the slum dwellers will be allowed to resell their units or whether they must remain in them. Other issues include timing of the project, guarantees to and from the government and the private parties to mitigate risk, and whether this model, if successful, can be extended to other slums in Asia.

    Keywords: Risk Management; Development Economics; Housing; Urban Development; Emerging Markets; Social Issues; Business and Government Relations; Real Estate Industry; Mumbai;

    Citation:

    Iyer, Lakshmi, John D. Macomber, and Namrata Arora. "Dharavi: Developing Asia's Largest Slum (A)." Harvard Business School Case 710-004, July 2009. (Revised June 2011.)
  11. Dharavi: Developing Asia's Largest Slum (B)

    In July 2009, as investors prepared to submit financial bids for the $3 billion Dharavi slum redevelopment project, considerable economic and political risks remained.

    Keywords: Risk and Uncertainty; Private Equity; Social Issues; Investment; Developing Countries and Economies; Business and Government Relations; Financial Services Industry; Real Estate Industry; Mumbai;

    Citation:

    Iyer, Lakshmi, and John Macomber. "Dharavi: Developing Asia's Largest Slum (B)." Harvard Business School Supplement 711-107, May 2011.
  12. Edward Lundberg and the Rockville Building: Energy Efficiency Finance in Commercial Real Estate

    A commercial landlord analyzes options for funding and accomplishing energy efficiency retrofit. The situation is complicated by lease terms and uncertain effectiveness of the intervention. Students must grapple with obstacles including changing energy prices, variations in energy needed in different climate scenarios, issues in net and gross lease responsibilities, and issues in finding adequate cash flow and security to satisfy a range of possible third-party funders. The business opportunity for third-party funders is also discussed.

    Keywords: Finance; Real Estate Industry;

    Citation:

    Macomber, John D., and Frederik Nellemann. "Edward Lundberg and the Rockville Building: Energy Efficiency Finance in Commercial Real Estate." Harvard Business School Case 212-067, February 2012.
  13. Masdar and Tianjin: Eco-Cities

    Compares Masdar City and Tianjin Eco-City, two high profile "sustainable cities." Each showcases technological and financial innovation. Is it real? Is it replicable and defensible? The case is intended to introduce main concepts and tradeoffs with respect to rapid urbanization, new cities, sustainable cities, and urban planning and infrastructure for efficient use of resources. Both of these developments have attracted significant government support as well as major private sector financial interest. Both of the sponsoring entities intend to use the lessons learned to help them to be influential in future new cities in other venues. The case looks at the basic economics of this level of development and poses questions about the costs, benefits, and uncertainties, by comparing conditions and intentions of each project. The ability to distinguish what is really worthy of being called an "eco-city" is explored, as is the likelihood of a single project financial payback from the deployment of many of the very exciting technologies.

    Keywords: Technological Innovation; Business Model; Development Economics; Urban Development; Cash Flow; Project Finance; Competitive Advantage; Environmental Sustainability; City; Infrastructure;

    Citation:

    Macomber, John D. "Masdar and Tianjin: Eco-Cities." Harvard Business School Case 211-064, January 2011.
  14. Urbi and the City Licensee Managers

    A leading low income housing builder in Mexico decides which prospective new local partner best extends its advantages in managing twin production lines of homes and clients. URBI has built substantial competitive advantage in the technology and culture that matches the outputs of these two production systems. The company has also built extensive expertise in accessing the many mortgage and funding sources in Mexico. To grow, the company is interested in entering other Mexican geographies but faces a choice of doing this with its own staff and buying land for cash, or partnering with local entrepreneurs and local land owners. In evaluating the choices, students must think more deeply about what makes the two production lines work and how to balance the two lines. The discussion can end with comparisons of the Mexican political and government circumstances that encourage this method of producing workforce housing as compared with the U.S., China, India, and other markets.

    Keywords: Mortgages; Government and Politics; Housing; Growth and Development Strategy; Brands and Branding; Market Entry and Exit; Production; Supply Chain; Organizational Culture; Franchise Ownership; Partners and Partnerships; Competitive Advantage; Real Estate Industry; China; India; Mexico; United States;

    Citation:

    Macomber, John D., and Regina Garcia-Cuellar. "Urbi and the City Licensee Managers." Harvard Business School Case 209-144, April 2009. (Revised May 2010.)
  15. Bardhaman (A): Shrachi and the West Bengal Housing Board

    A real estate developer decides whether to enter into a public private partnership with the government of West Bengal to develop a township on farmland. The decisions include whether to expand operations from the company's base in Kolkata to Bardhaman, 100 km away; whether to subdivide and sell raw land lots or follow the developer's vision and build a planned township; whether to enter into a public private partnership with the government of West Bengal, led by the Left Front and the Communist Party of India as equity partners; or whether to also accept a private equity firm into the project, what to build, and in what sequence.

    Keywords: Development Economics; Growth and Development Strategy; Business and Government Relations; Decisions; Private Equity; Design; Housing; Infrastructure; Projects; Real Estate Industry; West Bengal;

    Citation:

    Macomber, John D., and Viraal Balsari. "Bardhaman (A): Shrachi and the West Bengal Housing Board." Harvard Business School Case 210-062, February 2010. (Revised May 2010.)
  16. Bardhaman (B): Bengal Shrachi and the Township Design Decision

    A real estate developer in West Bengal chooses between two master plans for a 260 acre new township considering design, financing, and phasing. Two detailed master plans are considered, one with a radial design and an internal town square and one with a grid design and internal focus on parks and water features. The designs have different revenue potential, different cost implications, and different phasing decisions. The analysis includes soft issues and aesthetic issues including what contributes to the feel of a place and what contributes to various land uses supporting each other (retail, residential, office). The analysis also includes a detailed proforma for each plan. This case builds on "Bardhaman (A): Shrachi and the West Bengal Housing Board."

    Keywords: Urban Development; Construction; Design; Finance; Construction Industry; Real Estate Industry; West Bengal;

    Citation:

    Macomber, John D., and Viraal Balsari. "Bardhaman (B): Bengal Shrachi and the Township Design Decision." Harvard Business School Supplement 210-063, February 2010. (Revised May 2010.)
  17. Water Shortage and Property Investing in Mexico City

    A commercial property company evaluates water risks including the government's ability to remedy, the company's operating exposure and mitigation, and whether to relocate because of water risk. A real estate fund manager assesses investment prospects in Mexico City in the context of a major water supply and distribution crisis facing one of the world's largest cities. Can the investment manager understand the water problems so she can make a decision whether to invest in Mexico City? What will she learn about how water is sourced and distributed in Mexico City? And how might the potential public-private partnerships being discussed affect her investment prospects? The fund's investors are seeking real estate exposure in major world cities, particularly Mexico City. How can they assess and mitigate this exposure? How can they extend this thinking to other cities and countries?

    Keywords: Private Equity; Investment; Risk Management; Infrastructure; Privatization; Business and Government Relations; Partners and Partnerships; Financial Services Industry; Real Estate Industry; Utilities Industry; Mexico City;

    Citation:

    Macomber, John D., Regina Garcia-Cuellar, and Griffin James. "Water Shortage and Property Investing in Mexico City." Harvard Business School Case 210-085, May 2010. (Revised January 2014.)
  18. Mexico City Water Shortage

    In this case, a property company, a water privatizer, and municipal engineers explore the causes of and solutions to a severe water shortage in Mexico City, a great global capital. The protagonist is a real estate investor doing due diligence on the magnitude of the crisis, the impact on the firm's operations, and the likelihood of resolution. Due diligence includes interviews with city water officials and global-scale water privatizers. This case is an excellent introduction to city scale infrastructure issues on a global level. A related case, "Water Shortage and Property Investing in Mexico City," HBS No. 210-085, contains more real estate finance and less water infrastructure finance material than this case does.

    Keywords: Infrastructure; Environmental Sustainability; Urban Development; Mexico City;

    Citation:

    Macomber, John D., Regina Garcia-Cuellar, Griffin H. James, and Frederik Nellemann. "Mexico City Water Shortage." Harvard Business School Case 212-044, January 2012. (Revised January 2014.)
  19. IDFC India: Infrastructure Investment Intermediaries

    Indian financial intermediary matching international capital to local infrastructure decides how to balance range of services, risk-adjusted return, margin pressure, and nation building. IDFC was chartered with partial ownership from the Indian government to help evaluate policy and be a model for how private finance could be attracted to public infrastructure. As the nation and company grow, the firm also grows and embarks on a strategy of rapid expansion, offering a wide new range of financial products and participating in many aspects of the supply chain. Teaching questions include revisiting the original mission, contemplating the reduced margins and increased risks that come with entering a number of domains that already have established incumbents, and the trade-offs between maximizing shareholder return (for example through investments in full tariff power projects in rich cities) and maximizing the benefit to the nation (for example through subsidized tariff water projects in poor states).

    Keywords: Investment; Infrastructure; Corporate Social Responsibility and Impact; Mission and Purpose; State Ownership; Business and Government Relations; Business and Shareholder Relations; Partners and Partnerships; Financial Services Industry; India;

    Citation:

    Macomber, John D., and Viraal Balsari. "IDFC India: Infrastructure Investment Intermediaries." Harvard Business School Case 210-050, June 2010. (Revised May 2012.)
  20. Young Presidents' Organization

    The board of Young Presidents' Organization needs to decide on the future of its Networks Initiative, designed to connect its geographically dispersed membership base through 60 different interest-based networks. So far, one half of these networks have been considered successful, and now the board needs to decide what to do to make the remainder successful. Two options were considered. The first option, called "broad networks," focused on developing weaker ties and entailed keeping the initiative intact but funding it better, by allowing outside sponsors to provide the funds. The second option, called "deep networks," focused on developing strong ties and entailed scaling down the number of networks and providing them with support to encourage deep network formation, all funded internally.

    Keywords: Decision Choices and Conditions; Governing and Advisory Boards; Leadership Development; Growth and Development Strategy; Organizations; Social and Collaborative Networks;

    Citation:

    Piskorski, Mikolaj Jan, John D. Macomber, and David Chen. "Young Presidents' Organization." Harvard Business School Case 709-444, April 2009.
  21. Hang Lung Properties and the Chengdu Decision (A)

    A residential real estate developer competes in a heated auction for a prime retail development site in the interior of China during the 2009 boom. Total project cost might be in excess of $1 billion U.S. for over 4,000,000 square feet of building. Hang Lung Properties has enjoyed success in residential building in Hong Kong but has focused on very limited projects in China, notably two retail properties in Shanghai. After a decade in Shanghai the firm decides to enter second-tier Chinese cities including Chengdu, a city of 11 million in interior China. The case covers Hang Lung Properties' due diligence and thought process with respect to anticipated rental income, construction costs, and land costs. The auction includes many other well-capitalized firms and the price escalates. Hang Lung's team must decide whether to participate or withdraw. Students need to use judgment with respect to estimates of key variables including stabilized income, construction cost, and minimum expectations for return on investment in order to prepare their bids.

    Keywords: Buildings and Facilities; Decision Choices and Conditions; Investment Return; Geographic Location; Auctions; Bids and Bidding; Infrastructure; Valuation; Real Estate Industry; Chengdu;

    Citation:

    Macomber, John D., Michael Shih-Ta Chen, and Keith Chi-Ho Wong. "Hang Lung Properties and the Chengdu Decision (A)." Harvard Business School Case 210-089, June 2010. (Revised December 2013.)
  22. Hang Lung Properties and the Chengdu Decision (B)

    Second phase of auction for a prime retail development parcel in Chengdu, China. Competition forces the firm to revisit all of its land purchase criteria. Hang Lung Properties is known for rigorous due diligence, for discipline in buying property, and for good understanding of market cycles. The (B) case reveals the firm's assumptions in the Chengdu situation, as compared to what students had to derive on their own in the (A) case. The (B) case also reviews strategic focus with respect to asset classes and geography, as well as best practices for what to look for in cities that will be attractive for superblock mixed-use projects.

    Keywords: Geographic Location; Auctions; Bids and Bidding; Infrastructure; Competitive Strategy; Valuation; Real Estate Industry; Chengdu;

    Citation:

    Macomber, John D., Michael Shih-Ta Chen, and Keith Chi-Ho Wong. "Hang Lung Properties and the Chengdu Decision (B)." Harvard Business School Supplement 210-092, June 2010. (Revised December 2013.)
  23. Sarvajal: Water for All

    Entrepreneur wrestles with business model using SMS and RFID technology, franchising, and leasing to rapidly grow off-the-grid water purification business without subsidies. The company seeks to provide potable water services to rural and urban India where the public infrastructure does not exist. Past efforts have been stymied by rural operations problems including expensive technologies, challenging maintenance issues, cash management problems, lack of capital, and lack of a business model that makes sense for retail operators without subsidy. Using a franchising model that relies on seasoned local entrepreneurs, communication technology that monitors flows and quality, payment technology that takes cash out of the equation, and a "capital light" leasing model, the company hopes to create and share a new business model. If successful, the model can be copied by other social entrepreneurs with a market-based pricing scheme to provide other forms of infrastructure in emerging markets.

    Keywords: Business Subsidiaries; Business Model; Communication Technology; Private Sector; Social Entrepreneurship; Cost Management; Rural Scope; Emerging Markets; Infrastructure; Problems and Challenges; India;

    Citation:

    Macomber, John D., and Mona Sinha. "Sarvajal: Water for All." Harvard Business School Case 211-028, February 2011. (Revised September 2013.)
  24. Sound Group China: Urban Waste Entrepreneurs

    Private sector entrepreneur in China with advanced solid waste management capability competes with state owned enterprises and also government policies supporting a rival technology. Wen Yibo has used engineering expertise and political savvy to build a major privately held company providing the entire supply chain of water treatment, waste water, and integrated municipal solid waste capabilities. The company's services include engineering, manufacturing, consulting, "engineer, procure construct," "build operate transfer," and other forms of public-private partnership. The handling of municipal solid waste takes up to 50% of the annual budget of many urban areas in the developing world. The ability to use private sector funds and expertise could be critical to urban development. However, state owned enterprises can observe the success of private business and can enter and compete using their own skills, contacts, and inexpensive capital. The government may also be interested in subsidizing incineration over composting as a part of "waste to energy" strategy, even though this is less efficient than generating electricity from a coal or gas plant. The company has to decide whether to stick to its waste management roots or expand into an opportunistic incineration technology with minimal and nominal waste-to-energy benefits.

    Keywords: Private Sector; Public Sector; Service Delivery; Business and Government Relations; Environmental Sustainability; Wastes and Waste Processing; Urban Development; Utilities Industry; China;

    Citation:

    Macomber, John D., Chad M. Carr, and Fan Zhao. "Sound Group China: Urban Waste Entrepreneurs." Harvard Business School Case 211-086, February 2011. (Revised September 2013.)
  25. Schneider Electric: Becoming the Global Specialist in Energy Management

    Global electrical products company assesses growth and market demands in India. Company must decide between a products acquisition or developing a service business. Students need to be aware of different country conditions, demands on implementation of different strategies, impact on culture. Also discusses energy performance contracting in the context of making India's energy generation capability more efficient.

    Keywords: Globalization; Energy; Management; Energy Industry;

    Citation:

    Macomber, John D., and Rachna Tahilyani. "Schneider Electric: Becoming the Global Specialist in Energy Management." Harvard Business School Case 212-082, February 2012. (Revised November 2013.)
  26. Design Creates Fortune: 2000 Tower Oaks Boulevard

    A real estate developer assesses its ability to capture the benefits of investing in LEED Platinum, Vedic Design, and EnergyStar components in new buildings. The building at 2000 Tower Oaks Boulevard in Rockville, Maryland is said to be the healthiest building in the National Capital Region. Does this matter? Can the developer realize higher rents because of this? The developer performs a detailed cost-benefit analysis of energy-saving measures that overlap and reduce their cumulative benefit. They consider the impact of these measures in combination with Vedic design features (aka Vastu) on the overall health, productivity, and business success of building occupants. “Green leases” are discussed as the developer tries to establish a leasing strategy that reflects these benefits and associated cost savings. The case takes a deep look at many of the critical on-the-ground issues involved with innovative real estate development.

    Keywords: Buildings and Facilities; Cost vs Benefits; Energy Conservation; Construction; Investment; Knowledge Use and Leverage; Leasing; Renting or Rental; Value Creation; Real Estate Industry; Maryland;

    Citation:

    Macomber, John D., and Griffin James. "Design Creates Fortune: 2000 Tower Oaks Boulevard." Harvard Business School Case 210-070, March 2010. (Revised May 2010.)
  27. CityCenter (A): Vision and Design

    CityCenter is a $9 billion project for MGM MIRAGE. The project's star architects have a major disagreement about a critical design issue. Bill Smith, head of the MGM MIRAGE Design Group, must resolve this issue to the satisfaction of all the project's stakeholders. This case explores many issues in the construction of large-scale buildings: how to envision such a project, how to manage the architects, how different designs add value, and what criteria matter in resolving a dispute between designers. The case also explores the construction costs and revenue benefits of having two buildings built with significant leaning away from vertical.

    Keywords: Buildings and Facilities; Cost vs Benefits; Design; Construction; Projects; Business and Stakeholder Relations; Conflict Management; Value Creation;

    Citation:

    Kohn, A. Eugene, John D. Macomber, and Ben Creo. "CityCenter (A): Vision and Design." Harvard Business School Case 209-052, January 2009.
  28. CityCenter (B): Economics and Delivery

    Bill Smith is informed by his general contractor that a key component of the Aria Resort is going to be delayed. Aria is the centerpiece of CityCenter: a $9 billion complex and a bet-the-firm decision for MGM Mirage. Smith must make a decision as to whether to force the general contractor to complete construction or to have the MGM Design Group take over this piece of the construction. The case also looks at the economics of the CityCenter project and discusses the organizational underpinnings needed to make a massive construction process a success.

    Keywords: Buildings and Facilities; Decision Choices and Conditions; Construction; Finance; Organizational Structure; Projects; Complexity;

    Citation:

    Kohn, A. Eugene, John D. Macomber, and Ben Creo. "CityCenter (B): Economics and Delivery." Harvard Business School Supplement 209-094, January 2009.
  29. CityCenter (C): Turmoil and Choices

    “CityCenter (C)” follows the (A) and (B) cases chronologically. The (C) case explores the decisions facing MGM MIRAGE following a lawsuit by partner Dubai World and suspension of Dubai World's cash contributions to the project in early 2009. Issues include the discussion of activity by secured lenders and other involved financial actors, like Carl Icahn and James Packer, as well as MGM MIRAGE major stockholder Kirk Kerkorian. The firm considers various options and remedies with respect to the claim by Dubai World. “CityCenter (C)” can serve as an in-class handout to advance class discussion of the (A) and (B) cases to encompass events as they unfolded.

    Keywords: Lawsuits and Litigation; Private Equity; Games, Gaming, and Gambling; Decisions; Partners and Partnerships; Conflict and Resolution; Entertainment and Recreation Industry; Nevada;

    Citation:

    Macomber, John D. "CityCenter (C): Turmoil and Choices." Harvard Business School Supplement 210-066, February 2010. (Revised May 2010.)
  30. CityCenter (D): Financial Crisis, Grand Opening, and a New Paradigm

    “CityCenter (D)” follows the (A), (B), and (C) cases with subsequent chronological events through CityCenter's grand opening in December 2009 and financial results through March 2010. The case includes a simple valuation exercise intended to explore CEO Jim Murren's options as he seeks to avoid an MGM MIRAGE bankruptcy. The (D) case presents Murren with the choice of selling the Borgata casino in New Jersey or receiving an ownership stake in CityCenter itself. Students will draw on EBITDA comparables and projections to complete a simple valuation analysis to take a position on which asset to sell. “CityCenter (D)” can serve as an in-class exercise or homework assignment to follow discussion of the (C) case.

    Keywords: Insolvency and Bankruptcy; Private Equity; Games, Gaming, and Gambling; Decision Choices and Conditions; Entertainment and Recreation Industry; Nevada; New Jersey;

    Citation:

    Macomber, John D., and Griffin James. "CityCenter (D): Financial Crisis, Grand Opening, and a New Paradigm." Harvard Business School Supplement 210-067, February 2010. (Revised May 2010.)
  31. CityCenter (E): Blow up the Harmon?

    Citation:

    Macomber, John. "CityCenter (E): Blow up the Harmon?" Harvard Business School Supplement 212-092, March 2012.
  32. The StarNight Hotel Construction Bid: Real Time Competition on Schedule, Scope, and Cost

    The case is intended for use with the HBS Educational Technology Group "Construction Bidding Simulation." Material that can be taught includes quantity survey methodology (from the case); analyzing preliminary estimated costs per building trade (from the discussion questions); playing the multiparty real time competitive bid simulation to receive and process market costs; and debriefing on which bids should be accepted and why. Discussion points include what criteria to use in making the decision, how to process subcontractor bids, and how to award contracts. Many of the issues can be extended from construction into any bidding situation and any industry with multiple subconsultants or vendors.

    Keywords: Decision Choices and Conditions; Construction; Cost; Contracts; Bids and Bidding; Real Estate Industry;

    Citation:

    Macomber, John D. "The StarNight Hotel Construction Bid: Real Time Competition on Schedule, Scope, and Cost." Harvard Business School Case 209-067, November 2008.
  33. Forest Hills Park: Vision and Execution

    Citation:

    Macomber, John, and Ben Creo. "Forest Hills Park: Vision and Execution." Harvard Business School Case 208-098, January 2008. (Revised January 2009.)
  34. Disaster in April: The Obligations of Kelly Construction

    A construction company experiences a crane accident with multiple fatalities. The CEO, a client, and an employee must make choices to meet the company's obligations. Set in 2006, the case looks at the choices faced by board members of a museum that is an important client and that is faced with a completion deadline and of a key employee who has other offers of employment and is negotiating a stay-put bonus. The rights and interests of the surety company that provided the construction bond are also interwoven. The protagonist is the CEO of a multi-generational family business who must now negotiate with these parties and then decide whether to attempt to raise new capital, declare bankruptcy, or try to lead a controlled wind-down. The case explores crisis management, decisions by principals operating in the zone of insolvency, construction contract types, the limits of recourse available from construction bonds, roles of board members, calculation of an employee stay-put bonus pool, subcontractor and vendor communication, and reputational issues around bankruptcy or closure of a closely held family business. Analytical tools include contract status report, contractor balance sheet, and stay-put bonus pool.

    Keywords: Business Exit or Shutdown; Family Business; Insolvency and Bankruptcy; Governing and Advisory Boards; Compensation and Benefits; Contracts; Crisis Management; Construction Industry;

    Citation:

    Macomber, John D., Christopher M. Gordon, and Ben Creo. "Disaster in April: The Obligations of Kelly Construction." Harvard Business School Case 209-099, January 2009. (Revised April 2009.)
  35. Dharavi: Developing Asia's Largest Slum (TN)

    Teaching Note for [710004].

    Keywords: Wealth and Poverty; Developing Countries and Economies; Asia;

    Citation:

    Iyer, Lakshmi, and John D. Macomber. "Dharavi: Developing Asia's Largest Slum (TN)." Harvard Business School Teaching Note 710-011, August 2009. (Revised August 2010.)
  36. Sarvajal: Water for All (TN)

    Citation:

    Macomber, John, and Ian McKown Cornell. "Sarvajal: Water for All (TN)." Harvard Business School Teaching Note 212-074, June 2012.
  37. Sound Group China: Urban Waste Entrepreneurs (TN)

    Citation:

    Macomber, John D., and Phillip Andrews. "Sound Group China: Urban Waste Entrepreneurs (TN)." Harvard Business School Teaching Note 213-020, August 2012.
  38. Mexico City Water Shortage (CW)

    Keywords: Utilities Industry; Mexico City;

    Citation:

    Macomber, John D., and Frederik Nellemann. "Mexico City Water Shortage (CW)." Harvard Business School Spreadsheet Supplement 212-704, January 2012.
  39. Mexico City Water Shortage (TN)

    Citation:

    Macomber, John D. "Mexico City Water Shortage (TN)." Harvard Business School Teaching Note 213-031, August 2012.
  40. Masdar and Tianjin: Eco-Cities (TN)

    Citation:

    Macomber, John D. "Masdar and Tianjin: Eco-Cities (TN) ." Harvard Business School Teaching Note 212-072, June 2012.
  41. Edward Lundberg and the Rockville Building: Energy Efficiency Finance in Commercial Real Estate (TN)

    Citation:

    Macomber, John D., and Annelena Lobb. "Edward Lundberg and the Rockville Building: Energy Efficiency Finance in Commercial Real Estate (TN) ." Harvard Business School Teaching Note 212-076, June 2012.
  42. A Slice of the Pie: Ruby Collins and Tenants in Common

    A securitized small real estate investment vehicle fails and the many individual owners have to decide how to manage or dispose of the asset. This case follows Ruby Collins, a small investor, through the logic of Section 1031 Like Kind Exchanges as well as the consideration of Tenant in Common ownership. Tenancy in Common has some attractive aspects but its regulation falls between a security and a real estate investment. The risk and control characteristics also vary. This case explores both the valuation of the property and the logistical issues around managing it, and also the relationships between individuals who now find themselves business partners with no prior familiarity with each other.

    Keywords: Financial Instruments; Investment; Risk Management; Ownership Stake; Partners and Partnerships; Valuation; Real Estate Industry;

    Citation:

    Macomber, John D., and Kristian Peterson. "A Slice of the Pie: Ruby Collins and Tenants in Common." Harvard Business School Case 211-008, January 2011.

Other Publications and Materials

  1. Follow the Money: What Really Drives Technology Innovation in Construction

    Technology enthusiasts, academics, and software companies remain concerned about the slow pace of innovation in the construction industry. Tools are widely available that seem to provide eminently sensible and clearly apparent improvement to the process of design and construction of buildings and facilities. Why aren't they used? Because the monetary implications are not well considered. This paper explores the real business motivations of the construction and design firms who take on risk and reap reward in technology adoption. If they are motivated by enlightened economic self interest, it's clear why innovation is slow. Interested observers who wish to direct their work to the relevant issues can benefit from considering why and how the economic value of innovations actually flows through the system. Several financial models are proposed for representing those impacts. Innovation will come from other sources following disruptive business models. Four major methodologies promise true innovation—supply chain optimization, knowledge management, 3D design, and wrap-up economic models. These are likely to be adopted by new innovators and not by established firms.

    Keywords: Buildings and Facilities; Technological Innovation; Construction; Design; Performance Improvement; Motivation and Incentives; Knowledge Management; Adoption; Business Model; Capital Structure; Supply Chain;

    Citation:

    Macomber, John D. "Follow the Money: What Really Drives Technology Innovation in Construction." Paper presented at the American Society of Civil Engineers, 2003.

    Research Summary

  1. Sustainability, Real Estate and the Built Environment

    Research interests include:

    • Real estate development, design, and construction, notably how design creates value; 
    • Sustainable cities, in particular entrepreneurship and project finance in light of global trends in urbanization and resource scarcity.
    • Cleantech, in particular innovations in business and technology that stretch the productivity of resources like energy, clean water, or leverage the effectiveness of capital expenditures on transit.

    Teaching

  1. Building Sustainable Cities: Finance, Design, and Innovation

    This MBA elective takes a component approach to the parts that make up sustainable, competitive cities: buildings; infrastructure including transit, power, water, and IT; mini-cities, and greenfield new cities.

    Keywords: urbanization; real estate; social enterprise; environment;

  2. Innovation in Business, Energy and the Environment

    This MBA Elective is offered as a half credit classroom course and as a full credit classroom plus project course.  Students investigate industries and interventions in a wide range of topics ranging from hydraulic fracturing to nutrition in urban school districts; from large companies to startups, and from investors to regulators.
  3. Investing in Sustainable, Competitive Cities

    This Executive Education course is offered for one week in March of each year, by application.   The course explores how private sector investors, businesses, and entrepreneurs can follow a logical framework to invest in the components of cities that lead to both economic competitiveness and environmental sustainability.