Mark Whyte, partner for security and resilience consulting for EMEA at Control Risks, explains how to reduce risk in smart city developments as urban populations sprawl, and city projects and developments grow larger.
High profile real estate and infrastructure developments – mega and giga projects in particular – are a significant and continually expanding part of global economic activity. These massive ventures are fuelled by population growth and urbanisation, government stimulus packages, industrialisation and the rise of smart cities.
Across the globe, nations are competing to create environments that attract commerce, sports and major events, tourism and leisure – a development arms race to create the biggest, most innovative, and technologically advanced cities. A prime example is Saudi Arabia’s Vison 2030, which includes the giga projects Neom, Ammalla, Al Ula, and Qiddiya to name a few. These initiatives are part of a strategy to position Saudi Arabia as a global powerhouse.
Navigating a complex risk landscape
However, these ambitious projects have complex value chains, diverse stakeholders, and a growing reliance on emerging technologies, making the challenges of managing their risks and ensuring their success more critical.
Traditional threats such as terrorism and criminality remain significant, but new challenges have emerged. For instance, development now attracts attention from activists focused on environmental, sustainability, and governance practices at a global level.
Natural hazards like extreme weather, flooding, cyclones, and earthquakes pose escalating risks, particularly in densely populated urban areas. Annual global losses from these events are now estimated in the billions. As urbanisation accelerates and global warming intensifies, these risks will only grow, potentially eroding investor and end-user confidence if not properly addressed.
Beyond these visible risks, these major developments are also vulnerable to geopolitical pressures, land rights, and lack of transparency. Future investment requirements have been forecast to be in the region of $94 trillion between 2017 and 2040, and the sheer financial scale of these projects will make them prime targets for fraud and corruption. Poor risk management can derail projects and lead to skyrocketing costs, poor investor returns, lack of confidence, and reputational damage. The UN highlighted this its 2015 Global Assessment Report, stating:
“Investment decisions rarely take into account the level of hazard, or they discount the risk excessively due to short-term profits to be made. Consequently, large volumes of capital continue to flow into hazard prone areas, leading to significant increases in the value of exposed economic assets.”
For developers, proactive risk management is not just a safeguard but a competitive advantage, it can attract investors, reduce borrowing costs through lowered risk premiums, and help secure more favourable loan terms.
| A case study: Lagos as a global mega city |
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Consider Lagos, a metropolitan area with over 20 million people. This vibrant, fast-growing city has the fourth-largest GDP in Africa, and is the economic hub of Nigeria as well as a major African financial centre. The city has a significant influence on commerce, entertainment, technology, education, politics, tourism, art, and fashion in Africa and beyond.
However, Lagos also faces challenges. It ranks low on the Global Quality of Life Index due to wealth disparities, population growth, informal settlements and accompanying large informal economy, and high crime rates. In the context of the vison articulated by the State governor Babajide Sanwo-Olu to make Lagos State a 21st century economy that delivers higher standards of living for all its citizens, we see the scale of the challenge in delivering a new model city. Dar Al-Handasah, a firm engaged in Lagos’ ambitious development, has developed several masterplans that align land use with upgrades to transport and infrastructure. Strategic environmental and social assessments were conducted to evaluate long-term environmental and social impacts, demonstrating how comprehensive long-term planning can address existing urban challenges and pave the way for a model city. |
Resilience: the cornerstone of smart cities
A resilient city anticipates risks, identifies vulnerabilities, and implements strategies to mitigate threats to an acceptable level. Lagos was a participant in the 100 Resilient Cities project funded by the Rockefeller Institute and has already laid the groundwork for a successful model city.
It’s also worth touching on what a smart city is: one with the ability to collect, integrate and use information from critical infrastructure, systems, and population to optimise resource use, plan critical interventions, respond to incidents and crises, and support post-event recovery. Becoming a ‘smart city’ is an evolutionary process, not an end-state.
Resilience in a city involves both physical smart characteristics, such as robust infrastructure, and smart performance capabilities, such as using data for effective decision making. Designing a resilient city requires a vision by the programme leadership team that articulates the desired look, feel and user experience of the city while embedding risk management at its core.
Urban development risks and hazards are vast, and need to be addressed throughout the project lifecycle. Unfortunately, it is more likely that they will be handled ad hoc as they arise, or reactively within silos, allowing vulnerabilities to persist.
A cohesive security and resilience strategy articulates how the threats, hazards, and risks will be addressed, how security will be managed, and will in turn inform the security masterplan. The security masterplan, developed in collaboration with architects and delivery partners, encompasses urban planning and design through influence, spatial planning and land use distribution, utilities, mobility and transport, ensuring a comprehensive approach to safety. Security strategies and their component measures should be appropriate to the context, proportionate to the risks, and effective at reducing vulnerability and consequence exposure, for instance, risk.
Governance structures are essential for overseeing the implementation of the security strategies. Within a development’s project management office (PMO) function, a governance body ensures that security measures are integrated into every stage of planning, design, and construction. This oversight maintains the consistent and coherent “golden thread” of security and prevents critical measures from being compromised as the project progresses. A strong governance framework ensures that all security measures are fit for purpose and aligned with the project’s overall risk management objectives.
Making the incredible possible
Creating secure, resilient and sustainable developments is one of the biggest challenges facing governments worldwide. Urbanisation is an unstoppable trend, and by 2050 it is estimated that 68 per cent of the global population with live in cities.
While popular culture and dystopian fiction offer cautionary tales of cities plagued by chaos and disorder, these scenarios need not become reality. On many of the largest and most ambitious urban developments and infrastructure projects in the world, risk is addressed effectively to ensure the delivery of safe, secure and resilient communities.
Every day we see how these visons are becoming reality, and how risk management is being built into the very heart of these developments. As we continue to shape – and marvel at – these transformative developments, the goal remains clear: to create cities that are not only functional but also inspiring places for future generations to live, work, and thrive.
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Autor(en)/Author(s): Mark Whyte
Quelle/Source: Smart Cities World, 25.02.2025
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