Infrastructure guides investment flows
Developers and government planners alike take their main cue from an assessment of infrastructure in determining where property projects should go, a survey finds.
"Eighty-eight per cent of survey respondents rated infrastructure quality as a top or very important consideration when determining where real estate investments are made," said the survey, which drew on interviews with about 450 senior executives across the property industry and government circles.
The survey - Infrastructure 2014: Shaping the Competitive City - aimed to assess the role of infrastructure in attracting property investment to cities and sustaining the wealth of urban centres.
Almost 250 public sector officials in local and regional government and more than 200 senior executives at private developers, investment firms and real estate advisories gave their views in the survey, which was conducted by non-profit research organisation The Urban Land Institute and professional services firm EY.
Considerations about infrastructure topped the priorities among public-sector officials (91 per cent) and ranked second for their private-sector counterparts (86 per cent), the survey shows.
Consumer demand was the top driver for the private sector, with 90 per cent of private leaders ranking it a top consideration or very important. A skilled workforce was more likely to be seen as important by the public sector (89 per cent) than the private sector (64 per cent).
The survey said government services - regulations, tax structure and quality - fell in the middle of the group of influencing factors for both public and private-sector respondents.
The survey also highlighted the importance of co-operation between developers and local governments, with three-quarters of respondents citing this as a key factor guiding funding approaches for new infrastructure over the next decade. Strategies that require collaboration between property firms and civic leaders topped the list of likely infrastructure funding sources.
The private sector saw tax structure as less important than public leaders did, and government quality as more important.
The survey was the eighth in an annual series of reports.