© 2019 by Capital Frontiers

How Much Would Building a New City Cost?

 

If we built a new city in the modern era, it would be very expensive to do it from scratch. While most cities evolve organically and do not require all of their costs in an up-front investment, we ran some back of the envelope numbers on building a new city just to see what it would cost if we did build it all at once. Here is what they tell us:

 

 

 

How much do typical new cities cost?
 

Generally, building new cities is very expensive.Costs are highly variable, and depend greatly on site-specific conditions, but mostly are dependent on the ultimate success of the city. New city development runs as high as up to $1 million per future resident, though more typically can be done for around $100,000 to $500,000 per resident. Generally, those figures come down as the city's population grows over time.

 

 

How much of the cost would be land?

 

The average cost of land in the United States is about $3,000 per acre, and the population density of the United States is about 0.15 persons per acre. One can assume land costs per person for a new city in the United States would be about $20,000 per new resident, or somewhere between 5 and 20 percent of the ultimate cost of the city.

 

 

What is the potential profit?

 

GDP per capita is generally fairly high within cities - around $75,000 per person per year. It is conceivable that capital costs could be made up through taxation and fees over a period of time.

 

 

What are some examples of cities and their total up-front capital costs?

 

New York City: Between $500 billion and $2.5 trillion

Population: 9 million

Price per resident: $55,000 to $170,000

 

King Abdullah Economic City: $55 billion

Population: 20,000 to 1.8 million

Price per resident: $30,000 to $2.15 million

 

Dholera City: $30 billion

Population: 37,000

Price per resident: $810,000

 

Songodo City: $40 billion

Population: 80,000

Price per resident: $500,000

 

Masdar City: $20 billion

Population: 45,000 to 50,000

Price per resident: $400,000

 

Columbia: $1 billion

Population: 3,000

Price per resident: $333,000

 

Khazar Islands: $100 billion

Population: 1 million

Price per resident: $100,000

 

Thames Town, China: $785 million

Population: 10,000

Price per resident: $78,500

 

Fuzhou: $5 billion

Population: 110,000

Price per resident: $45,000

 

Brasilia: $19.5 billion

Population: 3 million

Price per resident: $6,500

 

 

 

 

 

 

 

 

 

 

 

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February 7, 2019

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