By Jacqueline Li, Associate
This past Fall, Concordia celebrated its fifth anniversary of supporting public-private partnerships for social and economic impact. On October 1st and 2nd, some of the most transformational thought leaders and decision makers (including 10 heads of state government) gathered at the Concordia Summit to address our most pressing global challenges. The central theme of the two-day conference was the potential for public-private collaboration to create amore prosperous and sustainable future. Concordia Co-Founders, Matt Swift and Nick Logothetis believe that collaboration between the private and public sectors is more relevant today than ever given our connected and codependent world.
The opening session, “Beyond Business,” examined the changing role of the modern CEO as the role of business in society changes. The intersection of the sciences, business, government, and society was discussed as a hallmark of our time, and the issues found at this intersection were described as “do good and do well” business opportunities. While philanthropy used to be the primary way for companies to engage on social and environmental issues, corporate responsibility is increasingly incorporated into their core services while realizing social and bottom-line benefits. The session highlighted innovative CEOs as drivers of this shift in business responsibility and strategy, emphasizing humanity’s need for markets that have meaning. Muhtar Kent, CEO of Coca-Cola, spoke to the opportunities and challenges associated with the adoption of sustainable practices. Coca-Cola’s “The Last Mile” program has leveraged the company’s supply chain and increased the availability of key life-enhancing medicines by 30-40% in Ghana and Tanzania. The model has been so successful that the company has established a $21 million partnership with USAID and the Gates Foundation to provide similar assistance to eight additional African countries.
Summit speakers spoke about the need for public-private partnerships to combat serious domestic concerns in addition to major social issues facing the developing world. Governor Dannel Malloy shared his vision for “Let’s Go CT,” a 30-year, $100 billion undertaking to overhaul the state’s current infrastructure framework. He suggested that there is a $1.7 trillion lack of investment in U.S. infrastructure, and that we are less competitive because we are not keeping up with other nations’ infrastructure investments. Malloy also commented that New York City does not have the infrastructure to support its growth of users. Under his plan, The CT State legislature has agreed to devote 0.5% of thecurrent sales tax exclusively to transportation.
The idea of the public and private sectors working together to address larger societal challenges is directly related to the future of commercial real estate. For example, cities now know that building emissions must decrease in order to meet their emission reduction targets. Cities therefore recognize how important it is to engage private sector building owners in order to achieve sustainability objectives. Forward-thinking regulations and meaningful incentives make it possible to do so while stimulating both their local economies and real estate sectors. This public-private interplay highlights the growing role that the building sector plays in local and national economies.
There are also negative implications for real estate if the United States continues its lack of investment in the physical facilities necessary to be competitive in the future. Rapid urbanization demands denser cities so that they can deliver accessibility and proximity at an affordable cost. Providing efficient, flexible and user-friendly working and living environments hinges heavily on reliable mass-transit systems. Similarly, real estate depends on the ease of travel and businesses are increasingly aware that the top talent in the millennial generation is not attracted to transit delays and congestion. Therefore, it is expected that areas not investing in infrastructure will experience less growth.
Cities today are requiring more investment in infrastructure, public buildings, and public space in order to improve city safety, efficiency and resiliency. Likewise, investors in growth markets are becoming aware that infill is hindered by aging transportation and underfunded utility infrastructure. Moving forward, public-private partnerships and private investment in infrastructure renovations will be key to ensuring future opportunity in strong markets. Leaders in commercial real estate now face a unique window of opportunity to differentiate themselves by establishing new models for infrastructure investments that will secure a profitable and sustainable future.
Jacqueline Li is an Associate in Cushman & Wakefield’s Sustainability Strategies team and a Masters candidate in Urban Planning at New York University’s Wagner School of Public Service. Prior to joining the Cushman & Wakefield team, she was a Policy Fellow to The Nature Conservancy and designed a pilot environmental education curriculum for The Los Angeles Audubon Society. Jacqueline has studied sustainable development in Australia and China, and received her BA, cum laude, in Environmental Studies and English from Bowdoin College.