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  • Article
  • Journal of Applied Corporate Finance

The Role of Finance and Private Investment in Developing Sustainable Cities

By: John D. Macomber
  • Format:Print
  • | Pages:11
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Abstract

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.
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About The Author

John D. Macomber

Finance
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More from the Author

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    Healthy Buildings: How Indoor Spaces Can Make You Sick—or Keep You Well

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    The First Four Healthy Building Strategies Every Building Should Pursue to Reduce Risk from COVID-19

    By: Joseph G. Allen, Emily Jones, Marissa V. Rainbolt, Linsey C. Marr, David Michaels, Leslie R. Cadet, Shelly L. Miller, Meira Levinson, Lidia Morawska, Richard L. Corsi, Nira R. Pollock, Yuguo Li, Alasdair P.S. Munro, Kelly Grier, Qingyan Chen, John D. Macomber and Xiaodong Cao
    • February 2022
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    Sekisui House and the In-Home Early Detection Platform

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More from the Author
  • Healthy Buildings: How Indoor Spaces Can Make You Sick—or Keep You Well By: Joseph G. Allen and John D. Macomber
  • The First Four Healthy Building Strategies Every Building Should Pursue to Reduce Risk from COVID-19 By: Joseph G. Allen, Emily Jones, Marissa V. Rainbolt, Linsey C. Marr, David Michaels, Leslie R. Cadet, Shelly L. Miller, Meira Levinson, Lidia Morawska, Richard L. Corsi, Nira R. Pollock, Yuguo Li, Alasdair P.S. Munro, Kelly Grier, Qingyan Chen, John D. Macomber and Xiaodong Cao
  • Sekisui House and the In-Home Early Detection Platform By: John D. Macomber and Akiko Kanno
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