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Untapped Wealth of Cities

RESEARCH Report by Alexander Hitch
Hong Kong skyline.

This report explores ways cities can assess the true value of their public assets


Cities seeking to pursue such strategies need a systematic way to assess the true value of their public assets, to develop professionally-managed governance systems, and build political will and public trust.

Key Findings

For many cities, finding innovative ways to fund infrastructure projects, pay off existing public debts, and meet recurring budget shortfalls is a perpetual challenge. Yet city leaders are often unaware of the value of their publicly-owned assets, and how to leverage this value for the common good.

Many cities worldwide are facing the concurrent challenges of deteriorating infrastructure, demands for new development, and requests for expanded services, all within constrained budget parameters. PwC Megatrends expects, for example, that $8 trillion in infrastructure spending will be needed in New York, Beijing, Shanghai, and London over the next decade. As cities age and grow, the pressures on both infrastructure and on local governments increase faster than cities can respond.

To support their balance sheets, city leaders are looking for new, creative sources of revenue, independent of tax increases or allowing the whole-scale privatization of public assets, such as airports, harbors, sewerage, and unused real estate. Cities must understand how to unlock the wealth of these public assets to generate future cash flows and manage the governance and accounting processes to ensure long-term stability and returns.

A novel approach to solving public-sector budget shortfalls is untapping the value of their commercial assets through private and professional management. Publicly-owned commercial assets include real estate, such as buildings and land, but also operational assets, which include utilities, such as energy and water. Leveraging public wealth without adding additional taxes, slapping on user fees, or privatizing city assets provides a more politically palatable safety valve as cities continue to see challenged balance sheets. However, this is highly dependent on the “best use” of the asset, and who exactly decides how the asset must be transformed into a more valuable entity. Are there specific assets that should be off-limits? Finally, how can city leaders build the political will in countries where this is yet to be implemented? 

About the Author
Alexander Hitch
Former Research Associate
Council expert Alexander Hitch
Alexander Hitch is a former research associate for the Global Cities team at the Chicago Council on Global Affairs, with expertise in the global economy. In this role, he coordinated various research at the Council, focusing primarily on global economic and trade policy.
Council expert Alexander Hitch