City Megatrends that will Dominate Future Urban Development
by Petros S. Sivitanides
Understanding city megatrends that may affect the way urban areas will grow in the future can be very useful to real estate investors, as they may identify opportunities today that will capitalize on such future developments.
A 2006 press release by PricewaterhouseCoopers argued that the cities of the world, despite their significant differences are tested by the same megatrends. The survey that focused on “Cities of the future - global competition, local leadership” interviewed 44 city leaders from 40 cities all over the world and took a year to complete.
The responses of these civic leaders highlighted important common themes and megatrends that are bound to affect the future of the cities all over the world in the decades ahead. It is important for real estate investors to keep in mind these city megatrends and try to envision how they may impact demand for different types of property and the path of urban growth in the markets they operate, and try to assess the real estate investment opportunities that are implied today by such future effects. Real estate investors need to also think though and the potential risks that are implied by these city megatrends with respect to the opportunities they are considering today or they may be considering in the future. The city megatrends that were identified by the by PricewaterhouseCoopers survey are the following:
Globalisation / Glocalisation
The global economy is expanding and is becoming truly integrated and increasingly more localities are getting hooked on the global network, creating in this way a simultaneous global and local focus known as "glocalisation". Movements of multinational companies from or to a city, as well as expansion in new cities by opening new branches transform the local business landscape and affect many areas of life in a city, including its real estate market.
Individualism
Individualism is an important social trend that raises demands from citizens towards city officials to be viewed as consumers and city leaders will be increasingly forced to direct city structures, functions, and operations accordingly to satisfy such demands
Merging
Many aspects of life are coming together in new ways transforming accordingly city structures, as well as local government objectives and programs: work and leisure, culture and values, public and private sectors in public private partnerships.
Acceleration
Speed is increasing in all aspects of urban life, both in business and social environments, mostly driven by rapidly advancing information and communication technologies.
Hi-Tech
Technology is entering all aspects of private and public life, in business operations and public administration, facilitating and improving the delivery of all existing services. Technology will continue to rule and expand its role in the private, business and public sector. For this reason hi-tech structures will continue to be in high demand by high-income individuals, corporations, businesses and local government agencies.
Demographics
The aging population will have a major impact across the globe. Senior citizens will become the prime target of multinational companies, while urban areas will face increased demand for home and living settings that can best serve the growing needs of this age group. Retirement home demand will be on the rise without doubt.
Urbanisation
Large cities will continue to have a growing influence on the economic health and prosperity of wider regions and in some cases nations, due to significant agglomeration advantages that will continue to fuel the expansion of their suburbs.
Migration
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