Argentina's growing urban population calls for efficient real estate

In 2008, for the first time in history, more than half of humanity was living in urban areas. Perhaps the most remarkable observation about this trend is the speed at which it has happened: as recently as 1900 urban areas accounted for 13% of the global population. Towns and cities are seen as the crucibles of opportunity for many rural dwellers.

The UN estimates that by 2030 urban areas will host 60% of the world’s population – up from 54.5% in 2016 – with the pace of urban growth especially rapid across Africa and parts of Asia. Urban areas are home to more than 470m people in Africa, accounting for 40% of the continent’s population, up from 14% in the middle of the 20th century.

Growing Pains

In 2016 there were 512 cities around the world with at least 1m inhabitants, more than 100 of which were in China. By 2030 this number is set to increase to 660, with around 40 being categorised as mega-cities home to more than 10m inhabitants, including Bogotá, Bangkok, Dar es Salaam and Ho Chi Minh City.

All cities, even those in prosperous and stable countries, face challenges, from providing adequate housing, sanitation, transport and energy, to combatting pollution and inequality. Not surprisingly, however, these issues are magnified in developing and emerging countries, where limited resources and weak institutions can struggle to cope with eventualities such as waves of migrants or the effects of climate change. Nonetheless, opportunities abound for municipal authorities and the construction industry to create urban areas that are sustainable, dynamic, healthy and safe.

Building Innovations

The construction sector is not generally considered a front runner in embracing innovation. The basic techniques of constructing brick and timber buildings date back centuries and – often for sound economic or aesthetic reasons – they have tended not to evolve dramatically. However, this tendency is changing, spearheaded by the advent of lighter, stronger and more flexible materials, along with innovative techniques such as modular construction and 3D printing.

While large projects are increasingly complex, industry players can use tools like building information modelling (BIM), robotics and the internet of things to ease their undertaking. These can improve efficiency and bring down costs, while also enhancing quality and sustainability, which will be important considerations as many urban areas need to be resilient against earthquakes and extreme weather, such as tropical storms, flash floods and heatwaves.

Smart Cities

The miniaturisation of sensors and the evolution of the internet means that information on almost all aspects of urban life – from air and water quality, to the movement of people and objects, weather, road and rail traffic, and energy generation and consumption – can be measured in real time. By linking houses, public buildings, factories, vehicles, power stations, traffic signals and street lighting, cities can be smart and responsive to the needs of residents. Developments in smart metering, solar photovoltaic technology and battery storage are leading to more local energy generation, which should facilitate the shift to cleaner, more efficient and quieter electric vehicles.

Qatar has embraced the smart city concept as it prepares to host the 2022 FIFA World Cup in Lusail. On the outskirts of Doha, the city is being developed with smart technology, incorporating sustainability measures to enhance residents’ quality of life.

“Lusail City was the first in Qatar to endorse the Global Sustainability Assessment System principles, and to rate all buildings according to their sustainability and performance,” Nabeel Mohammed Al Buenain, group CEO of real estate developer Qatari Diar, told OBG. The city will offer residents and visitors integrated smart transport and communications services, overseen by a central management facility. Meanwhile, in the renovated Msheireb area of Doha, several services offer a smart experience.

“These include navigation, people counting, help desks, online payments, CCTV, fire alarms and infrastructure network applications,” Ahmad Mohamed Al Kuwari, CEO of IT firm MEEZA, told OBG.

In the face of a rapidly urbanising population, the concept of smart cities is also being developed in numerous African nations, including Kenya’s Konza Technological City, 60 km outside of Nairobi and extending over 2020 ha of land. Dubbed “Silicon Savannah”, the project is part of Vision 2030, the country’s national development strategy, and is slated to see a combined $15.5bn in investment. Due for completion after 2030, the project is expected to create 100,000 jobs and generate $1bn annually, according to the Konza Development Authority.

Another example is the Eko Atlantic project in Nigeria, bordering Lagos’s Bar Beach coastline and spanning 10 sq km. Though the pace of work has been slowed by the domestic economic climate, the project is expected to attract 150,000 daily commuters and host a range of amenities upon completion, including high-end housing that will accommodate up to 250,000 residents.

The New Administrative Capital, Egypt’s new capital unveiled in 2016, is also working to integrate smart networks. Expected to be delivered by 2022, the city is located 50 km from Cairo and will extend over 700 sq km. It aims to help alleviate congestion, provide homes to 5m people and host some of the country’s main public institutions. In late 2017 another smart city was announced in Aswan, near Egypt’s Western Desert, to help accommodate the city’s growing population. The development will extend over 1620 ha and will include housing, recreational facilities and green areas.

Misaligned Driver

Housing construction has been a key growth driver in Yangon since reforms began in 2011, but developers have focused on the upper-tier segments, due to the paucity of accommodation and Myanmar’s position as a frontier market in a dynamic region. In 2013 rents in central areas soared above those in Bangkok and even parts of Manhattan. However, this resulted in an oversupply of high-end units and not enough affordable housing for average families.

Similarly, rapid urbanisation and the adoption of smart networks has been challenging across Africa. At 4.5%, the continent has the world’s highest urban growth rate, and by 2050 more than half of the population is set to be living in cities, representing an important demographic shift.

While there has been progress in developing some of the main urban centres, infrastructure works often lag behind, on the back of slow structural transformation, a historical dependence on natural resources and weak levels of industrialisation. Inadequate urban planning and underinvestment in infrastructure has seen informal settlements proliferate, as is the case in Lagos, Africa’s most populous city. With over 21m people and growing at 3.2% per year, Lagos has experienced unprecedented urbanisation, leading to the development of slums. However, as the government aims to turn the city into the “Dubai of Africa”, settlements are gradually being cleared, as was the case for Ilubirin and Otodo-Gbame, bordering the waterfront, in 2016. Despite challenges brought by population growth and the lack of accommodating infrastructure, the city acts as an economic engine, accounting for over 35% of GDP and 62.3% of non-oil GDP in 2010, per the UN Economic Commission for Africa.

Growth Potential

This is a testament to the potential cities have as drivers of transformation and economic growth. In addition to developing infrastructure, promoting economic efficiency, improving urban density and ensuring social inclusion, the success of Africa’s urban centres will depend on their ability to create employment for the continent’s ever-growing youth population. With more than half of Africans under the age of 18.5, and 19% between 15 and 24 years old, this represents a both significant challenge and a potential opportunity should it be tapped effectively.

A report produced by the African Development Bank, the OECD and the UN Development Programme in 2016 calls for policy reforms to make the most of the “urbanisation dividend”, and for African countries to spend the equivalent of 5-7% of GDP per year on infrastructure. According to the report, two-thirds of the investment needed in urban infrastructure through to 2050 has yet to be made, suggesting substantial opportunities lie ahead. The future of Africa certainly hinges on the ability to efficiently manage and develop city landscapes, and the capacity to turn major centres into engines for sustainable growth.

Master Plans

Experiences show that creating a sustainable city requires more than a dynamic construction sector. In Myanmar’s case, the municipal authorities are developing a master plan drawing on lessons from other regional cities, but progress could be constrained by a lack of skills, weak institutions, legal uncertainty and limited financing.

Plans are also afoot for the Yangon New City Project, a 12,140-ha development to alleviate congestion and reduce informal settlements. The project is supported by multilateral organisations and is expected to make extensive use of public-private partnerships. However, sustained work is required to strengthen the tax system, alongside attempts to replicate international best practices in harnessing private finance to improve public services.

Curbing Sprawl

In devising plans for the sustainable development of Yangon, Abidjan, São Paulo, or smart cities on the outskirts of Cairo and Jeddah, a significant challenge is sprawl. Architects and urban planners have come to recognise a key distinction between expansion and sprawl: cities have expanded throughout history and will continue to do so, but sprawl is a fairly recent and undesirable phenomenon. It refers not only to low-density suburbs, but also to the development of sterile apartment blocks, which have sprouted up in large numbers.

The writer and activist Jane Jacobs argued that the dramatic growth of car traffic separates city dwellers from each other and the natural environment. This, she claims, creates cities that lack the cross-fertilisation and interactions that allow humanity to thrive. In addition to facilitating sprawl, private cars have brought traffic congestion and a resultant loss in productivity and increase in stress, mental illness and non-communicable diseases stemming from inactivity, and other health conditions linked to air pollution. Jan Gehl, an urban architect, wrote about the importance of providing safe places to walk or cycle and enjoy outdoor spaces. Others refer to the “Goldilocks density”, at which buildings are densely populated enough to provide retail and services to vibrant main streets, but are not built so tall that people are removed from the streetscape. Buildings of six or seven storeys allow the sun to penetrate to street level, making it easier for ground-floor cafes to spill out onto the street, creating a sense of community and vibrant street life. Such buildings can also accommodate a large number of people: traditional Parisian districts house up to 26,000 people per sq km, while Barcelona’s Eixample district reaches 36,000 inhabitants.

Urban Principles

Some of the principles for solving sprawl and building sustainable cities that are likely to be taken up as city authorities work to manage their expanding populations include the preservation of natural ecologies, historical sites and architecture as a way to imbue urban communities with a sense of identity.

The benefits of creating opportunities for mixed-use infrastructure as well as mixed-income communities to prevent monolithic neighbourhoods divided by wealth is also likely to shape urban planning in cities across the world.

In terms of urban transport, investment in high-quality and affordable mass transit systems, and a focus on matching city density with transport capacity, is key to keeping cities moving. The increasing take-up of smart infrastructure is likely to make this job easier. The convergence of streets to allow for multiple modes of transport on a single path may likewise become popular if it enhances the potential for mass transit systems to gain traction in previously car-dominated areas.

The model of urban planning that extended from modernism and its vision of the city as a machine has proved extremely popular throughout the past half century – and it endures. But there is now a growing realisation that if urban areas are to be lively, safe, healthy and truly sustainable, they will need to develop a different form and complexion.