ABSTRACT

The twenty-first century is a time of dynamic global change and cities are the places where this change is most fundamental. Cities are increasingly interconnected in a networked world in which they are now the major locations for international commerce and economic production. Understanding the part that real estate development plays in supporting their functioning is vitally important. Real estate development has an increasingly powerful role in facilitating the circulation and accumulation of financial capital in a global economy that is transforming structurally with most of the growth coming from the service sector. In a world of volatile international capital flows, real estate-led development of commercial offices occupied by multinational firms in the business districts of major cities has come to be regarded by entrepreneurial governments worldwide as critical in creating both the physical infrastructure and the “global” atmosphere essential for inward investment, employment and economic growth. This century is the first in which humanity is becoming a predominantly urban species and, increasingly, it is cities that promise opportunities for work, access to resources and services, and for prosperity and well-being; in turn, urban work increases global productivity and innovation, and boosts GDP. As the world continues to urbanize, real estate development challenges will be increasingly concentrated in and around large business cities. This chapter focuses on the major global and local drivers that real estate and cities are caught up in, in a changing world, and the consequent pressing challenges for effective real estate development governance.