Economic Development: Metropolis from Scratch

Brasilia, Brazil: not livable. America’s 1960s federally-sponsored “New Towns”: not economically sustainable. The history of planned cities is strewn with the memories of failed projects and utopias that worked better as blueprints than as neighborhoods. This troubled history, however, has not deterred a multinational partnership from pursuing its radical idea: a city built from the ground up that is wholly for-profit.

In South Korea, on a landfill island 40 miles from Seoul, adjacent to the country’s main international airport, lies the future location of New Songdo City. The developers of this 1,500-acre project–about the size of midtown Manhattan–began to develop the idea for the city during the early-1990s in recognition of the enormous business potential of Northeast Asia. The South Korean Ministry of Trade and Finance expects the GDP of Northeast Asia, a region that includes northern China, eastern Russia, the Koreas, and Japan, to account for 30 percent of global GDP by 2020. The development team hopes to create a premier location for multinational firms to headquarter their Northeast Asian operations. New Songdo’s residents–expected to reach half a million people by 2010, evenly divided between Koreans and foreigners–will go to hospitals administered by Johns Hopkins; its children will study at schools run by Harvard’s Education faculty. 

Plans for the city were put on hold by the East Asian financial crisis of 1997 and 1998, but have otherwise continued apace for the last decade. In 2000, the City of Incheon made an agreement with POSCO E&C, Korea’s largest engineering and construction company, and the Gale Corporation, a major American developer. Incheon embarked on a massive landfill project, adding 3,000 acres of land around Songdo Island, and sold the site to Gale in 2002; the first phase of the project, a $2 billion convention center complex, began construction earlier this year. The second stage of the project–the construction of the actual city–is expected to begin in 2005. With an estimated $5 billion worth of municipal infrastructure, the total cost of the project approaches $20 billion–far beyond anything Gale, or any other developer, has attempted before.

Building a History from Scratch

In order to make the city as attractive as possible to future residents, its developers aim to replicate the neighborhood diversity and texture that typically comes from years of organic growth. By mixing different types of buildings and designs, lead architect Jamie Von Klemperer says, “it’s as if you had a rich history of architects, planners, and thinkers, each adding something.” The planners borrowed recognizable features from countless other cities worldwide–New Songdo’s designers are particularly proud of its Venetian-style canals. It has a Central Park like New York, and 40 percent of New Songdo will be green space, a much higher percentage than nearly any other Asian city. It also has dense areas like London and Paris, and garden districts like those in Savannah, Georgia. These elements are paired with Korean features like an emphasis on residential superblocks set back from the street, and aspects of Confucian planning theory, such as the centrality of educational and cultural institutions.

The focus on replicating urban features from throughout the world reflects a focus on creating a general urban pleasantness, rather than any grand planning theories. Its designers expect this quality will attract the multinationals that are New Songdo’s commercial raison d’etre–so what makes planning sense, they think, will also make business sense. According to Von Klemperer, designers “had to make sure that before [office uses] fill in, the city would have a completeness to it”–a completeness which Von Klemperer says is rare in Asia. The New Songdo design team believes that it has learned from Shanghai, which increased its office space after the fact, slapping down large, inhospitable office developments and connecting them with wide roads. New Songdo’s calling card will be its large stock of office space in a more appealing urban setting.

New City, New Regulatory Environment

According to Dr. Peter Marcotullio, a Research Fellow at the United Nations University Institute for Advanced Studies and an expert on East Asian cities, economic incentives will be more important to the success of the project than any cutting-edge planning. He noted that similar business-oriented planning projects, such as Cyberjaya in Malaysia, have proven difficult to get off the ground because the cutting-edge businesses they try to attract are “so footloose; now they can go anywhere… If I’m a software maker, I don’t have to be there.” Companies simply go shopping for the best tax and regulatory deal.

In a 2003 article in Management Decision magazine, Professors Mike Hobday, of the University of Sussex, and You-Il Lee, of Edith Cowan University, interviewed senior executives of multinational corporations about Korea’s potential as a business hub. The executives expressed concern about restrictive labor and tax policies in Korea. Normally, Korea’s tax and land use policies favor Korean companies. One of Songdo’s key selling points is its status as a “Free Economic Zone.” In FEZs, many of Korea’s restrictive labor policies, such as mandatory employment quotas for veterans and the elderly, don’t apply. Foreign corporations and their employees enjoy extensive tax breaks and reduced land fees, and can establish their own schools and hospitals. The Korean government even provides administrative support to foreign companies, and allows them to file documents in English.

But some planning factors may indeed be important to New Songdo’s success. Interviewed executives in the 2003 article declared their preference for locations with a familiar Western feel. The executives also said that on the whole they would only consider building their headquarters in a city after they had built up a high level of comfort by doing business there for many years. New Songdo’s planners have thought deeply about how to appeal to Westerners and Koreans alike, and how to make a new city feel established and comfortable–though it is unclear whether a new city could ever feel as familiar as its centuries-old rivals.

Will New Songdo Have Room for the Unexpected?

In adhering to the formula that good design will make a city commercially appealing to corporations, the developers seem to have glossed over the people who aren’t part of their business plan–namely, the poor and working-class. It is impossible to have a city where only white-collar office workers live because office functions need support industries: they need people to launder their shirts, print their documents and make their take-out dinners. Those in the service industry will necessarily make less money than their counterparts and live in less desirable neighborhoods; how does one plan for this?

No one really wants to answer that question. When asked, Von Klemperer talks about the wide range of residential, office, and retail properties that New Songdo will contain–a range that extends to affordability but, of course, shies away from the idea that any of these properties will be less appealing. Whether or not the plan allows for less desirable neighborhoods, they will inevitably emerge, and in unpredictable ways.

The history of cities has an obvious lesson: you never know how they are going to develop. The designers of New Songdo have made an admirable effort to look at the world’s great cities and incorporate their best qualities–qualities that have emerged after hundreds of years of change. New Songdo’s studiously non-dogmatic approach to planning may do the trick of simulating the effects of history, but it risks becoming a new dogma all its own, ready to be overrun by organic growth.

The designers acknowledge the risk, but say that it is inevitable. The only way that we’ll see how well Songdo works, of course, is with time. As New Songdo and its population take shape, we’ll discover whether the best-laid plans of Kohn Pedersen Fox can even begin to describe the workings of a complex organism of a half million people in what might be the biggest and most significant planning experiment of our age.

For more information regarding the Songdo City project, please see:

www.thegalecompany.com

You-Il Lee and Michael Hobday. “Korea’s New Globalization Strategy: Can Korea Become a Business Hub in Northeast Asia?” Management Decision Vol. 41 No. 5 (2003).