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
| Feb 9, 2012
Computer tool helps engineers design roof cladding using Canada's building code
Easier to design roof cladding that can withstand winds in a given area.
| Feb 9, 2012
Webinar focuses on lessons learned from LEED-certified industrial project
This case study will focus on strategies used to save the client money, achieve certification, and effectively market success once the project was complete.
| Feb 9, 2012
Rapid growth of zero energy buildings expected
Much of that growth will be in the European Union, where near-zero energy buildings are mandated by 2019 for public buildings, and by 2021 for all construction.
| Feb 9, 2012
Stiffer OSHA fines put strain on Kansas contractors
A fine for a violation that once cost between $750 and $1,200 now runs $7,000 or more per incident, according to a state industry association official.
| Feb 9, 2012
Webinar focuses on lessons learned from LEED-certified industrial project
A Construction Specifications Institute webinar will focus on the lessons learned through the design and construction of a LEED-certified industrial project, Better Living Mill Shop, the first industrial building in Central Virginia to earn LEED certification.
| Feb 8, 2012
California likely to eliminate redevelopment agencies
Leaders of California cities had been trying to fashion a compromise with lawmakers after the state Supreme Court ruled the state had the authority to eliminate the agencies and use their property tax money for local services.
| Feb 8, 2012
Project aimed at economical seismic retrofits on historic Memphis structures
The group will develop a low-cost seismic retrofit model that would benefit aging brick-and-mortar structures. It involves bolting steel brackets to existing wooden floor and ceiling joists.
| Feb 8, 2012
Houston signs on to Better Buildings Challenge
The challenge has about $4 billion in federal and private-sector funds, which it will use for building energy upgrades nationwide in the next two years.
| Feb 8, 2012
OSHA offers free health and safety consulting for small businesses
The consultants offer confidential, non-punitive advice.
| Feb 8, 2012
Controversy over pay for prisoners on roofing job in Michigan
The disagreement was over whether the prisoners should have been paid prevailing wage for their brief time on the job because the project was paid for with a U.S. Department of Energy grant.
