Today, more than half of the world lives in an urban area. By 2050, this number is expected to increase to some two-thirds of the world’s population, according to the United Nations. While this may lead to overcrowding in cities, and overuse of resources, it also presents companies in the construction industry with major opportunities for growth.
GlobalData tracks large-scale construction projects in all sectors, and following a recent assessment of project pipelines in major cities worldwide, it has compiled a listing of 50 “Construction Mega Cities” for 2019, each having a pipeline of projects with an investment value above US$30bn. The combined value of the project pipelines in these cities stands at US$5.3 trillion, and includes over 8,200 projects at various stages of development, from announced to execution.
From 2007 to 2025, GlobalData expects the cities’ combined gross domestic product (GDP) to increase by more than US$8 trillion to US$20.4 trillion. They will be home to an estimated 527 million inhabitants, many being in China and other emerging markets that are witnessing a fast pace of urbanization. GlobalData projects that average per capita GDP in these cities will rise from US$1,791 in 2007 to US$2,263 in 2025, in real terms.
Dubai remains at the top of the list of ‘Construction Mega Cities’, with total project values amounting to US$611.2bn, ahead of London in second place (US$342.9bn) and New York in third (US$285.2bn), while Moscow slipped to fifth place (US$201.4bn) when compared to the 2018 rankings. Seven new cities have made it to the 2019 list, namely Istanbul, Tokyo, Fuzhou, Zurich, Atlanta, Zhengzhou and Las Vegas. The combined value of the project pipelines for those new entrants stand at US$379.75bn, and includes 505 projects at various stages of development. The Asia-Pacific region dominates the list, accounting for 25 of the 50 cities, and has a combined projects pipeline valued at US$2.1 trillion.
Yasmine Ghozzi, Economist at GlobalData, comments: “Of the 50 ‘Construction Mega Cities’, 29 are considered to be in emerging markets. The rapid growth of cities in the emerging regions reflects both above-average population and per-capita GDP growth. The population of those 29 emerging-region cities will reach an estimated 327 million by 2025, at an annual increase of 1.8% from 237 million in 2007. At the same time, GlobalData projects that the real GDP per capita (measured in real terms) in these emerging urban centers will increase by 2.4% from US$520,854 to US$820,311 between 2007 and 2025.”
Ghozzi adds: “Reflecting the varied levels of economic size, there are major differences among the 50 ‘Construction Mega Cities’ in terms of the value of the project pipelines compared to the size of the economies. Some major cities in the Middle Eastern Gulf states, namely Dubai, Doha and Kuwait City, along with Cairo, secured their spots in the top ten in terms of spending on mega projects relative to the size of their economies. The construction sectors in these cities are expected to be key drivers of economic growth in years to come. However, Dubai’s economy is expected to grow by 1.3% in real terms in 2019 reflecting the completion of many infrastructure projects related to Expo 2020 Dubai.”
Ghozzi continues: “Mumbai has the fastest-growing city economy owing, in part, to the government’s thrust on infrastructure. Supporting continued growth, the Asian Infrastructure Investment Bank (AIIB) announced in November 2019 that it had approved an investment of US$575m in suburban railways and renewable energy sector in Mumbai, taking to its total commitment in India to nearly US$3bn. It will extend a long-term project loan to Mumbai Urban Transport Corporation for US$500m, while the remaining US$75m will be invested in Tata Cleantech Capital to boost renewable energy, power transmission and water infrastructure.”
Related Stories
Codes and Standards | Jan 30, 2017
Denser development could reduce emissions more than building energy retrofits
More tightly packed cities would cut building emissions significantly, study says.
Codes and Standards | Jan 27, 2017
Calif. legislator proposes statewide solar mandate for new buildings
It would be the first such requirement in the U.S.
Codes and Standards | Jan 25, 2017
Standard baseline for measuring building efficiency needed
EUI could push sustainability through market-driven approach.
Codes and Standards | Jan 23, 2017
Workers, local officials rally for new construction safety law in New York City
The new law would require those who work on 10-story-plus buildings to go through an apprenticeship program.
Codes and Standards | Jan 23, 2017
Prominent Atlanta construction executive faces charges in $1 million bribery scheme
The company has worked on some major projects, including Hartsfield Airport.
Codes and Standards | Jan 20, 2017
New resource lists green incentives by state
USGBC's new Public Policy Library includes tax and energy benchmarking policies.
Codes and Standards | Jan 18, 2017
How green leases benefit owners and tenants
Agreements to spur efficiency upgrades are slowly gaining popularity.
Codes and Standards | Jan 17, 2017
Intl. Code Council looks into code changes for cross-laminated timber structures
Most codes limit CLT structures’ height.
Codes and Standards | Jan 16, 2017
Building codes for existing buildings evaluated in new white paper
The paper examines implementation, enforcement challenges, and changes needed in new code editions.
Codes and Standards | Jan 13, 2017
New BIM guide for owners released
National Institute of Building Sciences releases a manual for developing standard set of BIM documents.