Page 10 - A U4SSC deliverable - Guidelines on tools and mechanisms to finance Smart Sustainable Cities projects

of information) and to incorporate the feedback from projects to enhance development policies
(bottom-up flow of information).

The Guidelines suggest that, by following this set of recommendations, a city will be able to create
a virtuous urban development cycle, where commitment to achievement of the SDGs leads to a
pipeline of investment-grade projects that generate public and private investment, contribute to
job creation and protect the planet by generating sustainable economic growth. To implement this
process, it is proposed to use a project-management tool based on a gate system, where a project
is submitted to a “go/no-go” decision process at each stage. This is designed to ensure that the
viability of a given project is reconfirmed at each stage. It is also proposed to create a project book
that provides a perspective on how different projects contribute to the city’s vision of its long-term
sustainable urban development.

The fourth chapter of the Guidelines outlines how potential investors might assess the financial
attractiveness of urban development projects. Investors have different levels of risk tolerance,
which is the deciding factor for them when deciding to “enter” or “get out” of a project. Chapter 4
summarizes what attracts investors from the operational, financial and reputational perspectives.

The final section of the Guidelines provides an outlook on how the recent COVID-19 pandemic
might change the behaviour of investors around financing urban development projects. The
three priorities for every city and government will now be to respond, recover and rebuild. The
section also elaborates on some trends that might emerge as a result and how these may influence
investment in projects related to large infrastructure, industry and logistics, commercial real estate,
hospitality and restauration, geriatric and nursing homes, offices, residential real estate, and public
urban facilities.

Additional tools and insights for attracting capital to city projects are provided in the annexes of
the publication.

viii U4SSC: Guidelines on tools and mechanisms to finance Smart Sustainable Cities projects