Shaping the infrastructure marketplace of the future

By Michael Sutherland | May 28, 2019

The UN estimates that 68% of the world’s population will live in cities by 2050. This urban growth is caused by many things, among them the search for opportunity and access to services. As people flock to cities, infrastructure must meet the challenge of growing to accommodate populations, while also creating connected, prosperous, and efficient cities —enabled by an evolving marketplace of people, technology, and ideas.

The need for innovative infrastructure is great. Not only is it integral to how we live our lives, it’s a must if we want to optimize our infrastructure investment dollars and generate all the possible benefits to citizens, businesses, and the environment. However, the need for infrastructure greatly exceeds the current level of investment that the public sector is making in new and refurbished infrastructure projects. More capacity needs to be found, and that capacity needs innovation applied for greater efficiency and results.

Public managed infrastructure planning and delivery is constrained due to the nature of government process, inefficient leadership turnover, lack of bandwidth and skills to sufficiently optimize, and narrow financial resources. Governments do not have the capacity necessary. While governments are essential, they cannot, nor should they tackle this problem alone. The right kind of government participation and a steady rule of law can set up the conditions for success for the private sector to innovate, deliver faster, and deliver more. Interestingly, since public infrastructure by its nature creates significant public benefit, a lion’s share of funding is needed from the public sector. But the private sector can take a leading role in front end planning and optimization – where agility and clever solutions can yield the greatest results. There is certainly opportunity for optimism.

There is no shortage of ingenuity in the world, and it has given us remarkable innovations and products that were unimaginable by most mere decades ago. For example, smartphones. Or sensors in everything that can provide data and underpin artificial intelligence. However, in public infrastructure there are constraints which limit the realization of a thriving marketplace for ideas. Too often the private sector doesn’t step-up with ideas, not because the ideas don’t have a strong foundation, but because the end-benefit of an infrastructure project often appears too widely distributed for private sector parties to follow through with real participation. For example, real estate value creation because of better district infrastructure. A wider and more ambitious perspective can bring new or greater opportunities into view.

As technical and strategic planning experts, we at Hatch understand the planning, optimization, and due diligence that is required to plan and deliver large infrastructure projects that will meet the world’s needs head on. We understand the impacts of those projects on communities and land. We can engage with public-sector stakeholders to bring forward a competitive advantage to the marketplace that includes optimized planning, streamlined delivery models, and skills that suits the project. By reducing (or knowing how to efficiently work within and around) bureaucratic constraints, the private sector can deliver projects that the public sector thought they couldn’t deliver; or sometimes even see.

To improve infrastructure productivity, governments must be willing to re-write the handbook that can limit the private sector from taking on a larger role. Governments can amend outdated regulations and even pricing that support traditional public sector monopolies and impede more active private participation and innovation that can create new Public-Private partnerships and infrastructure projects.

Hatch has experience in large-scale projects where a high degree of innovation was applied, which in turn deliver large community and economic benefits. We have a history of working in London, Toronto, and South Africa, among other places, to bring together city-shaping development and mass transit. In the energy space similar innovation enabled by recent technology, urbanization, and shifting climate change policy trajectories is bringing significant opportunities into view. The investment in time and complexity up-front can seem large to some at first, but the financial and broader public returns are huge. Hatch is bringing together credibility, relevant experience, and capability to help realize many remarkable projects.

It is critical that we improve the way infrastructure is planned, delivered and operated. Infrastructure determines where we live and work, how we get there and how we access the necessities of life. Building more prosperous, functional, and responsible cities begins with a dialogue between several parties in the economic space: government and government agencies, private sectors, and communities. It is only when these parties are successfully working together that we will truly begin to respond to the magnitude of the infrastructure gap, responding to the future demand for infrastructure in innovative, life changing ways.