Since Hong Kong’s return to China in 1997, the direction of urban planning has been constantly adjusted and adapted to the aspirations of society. In the early days after the reunification in 1997, the administration continued the practice of government-led formulation of blueprints for the future with economic development as the focus. The advent of the new millennium has been accompanied by a strong civic consciousness. The public have attached unprecedented importance to the conservation of historic buildings, the preservation of collective memories and the inheritance of cultural values. Long-term planning of the city also took into account a number of factors, such as air quality, noise, visual impact on both sides of Victoria Harbour, building heights and public space. The development in rural areas, with the goal of redistributing the urban population, was also constrained by calls to improve urban life.
Colin Lizieri and Daniel Mekic
There is a growing awareness in urban social science of the importance of commercial real estate as a medium by which large cities are embedded within global capital networks. This trend is most pronounced in the office markets of international financial centres and has become more marked with increasing globalization of commercial real estate. Nuances of market processes can be lost in over-simplistic categorizations such as ‘international financial capital’ or ‘property developers’. Diversity in the nature of office investors leads to substantial differences in the motivations for building international portfolios and in impacts for the cities concerned. This chapter provides a detailed examination of the City of London office market, drawing on a unique database tracing office ownership over some 40 years. The changing tides of ownership, from predominantly local domestic to over 60 per cent non-UK owned in 2014, are linked to transformations of the City of London economy.
One key hypothesis I arrived at early on in my research was that intermediation was an increasingly strategic and systemically necessary function for the global economy that took off in the 1980s (Sassen, 1991/2001, 2012; Sassen-Koob, 1982). This in turn led me to generate the hypothesis about a need for specific types of spaces: spaces for the making of intermediate instruments and capabilities. One such strategic space concerned the instruments needed for outsourcing jobs, something I examined in my first book. But what began to emerge in the 1980s was on a completely different scale of complexity and diversity of economic sectors: It brought with it the making of a new type of city formation. I called it the global city – an extreme space for the production and/or implementation of very diverse and very complex intermediate capabilities. This did not refer to the whole city. I posited that the global city was a production function inserted in complex existing cities, albeit a function with a vast shadow effect over a city’s larger space. In that earlier period of the 1980s, the most famous cases illustrating the ascendance of intermediate functions were the big mergers and acquisitions. What stood out to the careful observer was how rarely the intermediaries lost. The financiers, lawyers, accountants, credit rating agencies, and more, made their money even when the new mega-firm they helped make eventually failed. Finance became the mother of all intermediate sectors, with firms such as Goldman Sachs and JP Morgan making enormous profits, followed at a distance by the specialized lawyers and accountants. From the early phase dominated by mergers and acquisitions, intermediation has spread to a growing number of sectors. This also included modest or straightforward sectors: For instance, most flower sellers or coffee shops are now parts of chains, they only do the selling of the flowers or the coffee, and it is headquarters that do the accounting, lawyering, acquisition of basic inputs, etc. Once, those smaller shops took care of the whole range of items; they were a modest knowledge space. Intermediation can now be thought of as a variable that at one end facilitates the globalizing of firms and markets and at the other end brings into its envelope very modest consumer oriented firms. It also contributes to explaining the expansion in the number of global cities and their enormous diversity in terms of specialized knowledges.
This chapter departs from an understanding of the global city model as an economic geography concept to comprehend the function and position of specific economic actors in certain cities in the management and, in particular, in the ‘command and control’ of the world economy. Because the global city literature has not advanced satisfactorily in deepening our understanding of the role of global cities in the world economy and, in particular, in the organization of globalization, the chapter suggests an operationalization of research on global city makers and their practices through the conceptualization of global cities as critical nodes in global commodity chains. To deepen this notion, the chapter discusses global city formation in two non-prime global cities, namely Mexico City and Hamburg.
Transnational urban space-making has been discussed either in the context of corporate impacts on global cities or of transnational urbanism in the migration literature. This chapter brings together these two research strands and discusses the dual role of transnational professionals in global city making as both decision-making business practitioners in transnational corporations and also individuals with transnational social-spatial practices as specific transmigrants themselves. It is based on data deriving from 45 semi-structured interviews with transnational financial professionals accompanied partly by mental maps drawn by them, and complemented by expert interviews with real estate agencies as well as a group interview with Tokyoite peers. The chapter sheds new light on a so far neglected aspect of global city making by presenting empirical evidence on transnational professionals and their dual space-making process as micro-level actors embedded in the global cities network.
Bart Lambregts, Jana Kleibert and Niels Beerepoot
This chapter investigates how the offshore services industry contributes to processes of global city making in India’s financial capital, Mumbai. It looks for synergies between the city’s offshore services sector and its onshore financial services sector, nursing the idea that the latter should be regarded as Mumbai’s main ‘global city maker’, and exploring the hypothesis that the offshore services sector contributes to global city making mainly by supporting the functioning of the city’s onshore finance sector. The chapter shows that while operational interactions between Mumbai’s offshore and onshore financial services sectors are limited and while the offshore services activities themselves do not accumulate commanding powers in global production networks, it is through human capital formation, auxiliary services upgrading, financial services demand creation, and reputation-building that the offshore services industry fosters the city’s onshore finance sector and thus indirectly, yet meaningfully, contributes to the making of Mumbai as a global city.
A History of its Urban Development
Post-war urban planning in Hong Kong was arduous and full of challenges: insufficient land resources in the city, shortage of economic resources, and an unstable global political situation. Planning for political and commercial uses such as government administrative centres, cultural centres, transport interchanges, distribution of offensive trades, heavy industrial areas, manufacturing industrial areas and distribution of public housing areas was mainly aimed at coordinating with the development of core districts and formulated according to the respective geographical conditions of each district so that they each could fully realise their potential and fit in with the overall development of the city. The effective planning and development of external transport enhanced Hong Kong’s status in entrepôt trade, while the city’s internal transport diverted the population from densely populated urban areas to new towns in the New Territories, reinforcing the post-war strategy of developing manufacturing industries with immediate impacts.
Economic Actors and Practices in the World City Network
Edited by Michael Hoyler, Christof Parnreiter and Allan Watson
In the commercial real estate markets of New York and London, transaction costs are high due to the private nature of the markets, the heterogeneity of real assets, and the time it takes to acquire and dispose of property. Broker intermediaries provide knowledge of the asset, the market and the counterparty to the transaction and by doing so can increase trust between parties and improve market efficiency. However, the unique practice of intermediation observed in London wherein both seller and buyer typically retain broker representation can create significantly higher transaction costs compared to New York. Moreover, when two broker intermediaries ‘work a deal’, a ‘tri-dyad’ network structure forms in which those who work between become privy to all aspects of the investment, which creates a significant informational advantage for the intermediaries. The system of double brokerage creates a ‘tertius gaudens’ effect.