4.2 billion people live in cities and that number is growing by 1.5 million each week.
90% of the urban growth will occur in developing and emerging economies.
Rapid urbanisation is fueling cities’ infrastructure needs. Yet a US$3.2 trillion annual global investment gap, to realize this infrastructure, currently exists.
There is limited interface between infrastructure project promoters in low- and middle-income countries and investors.
Significant global private capital is available to invest in bankable infrastructure projects, especially those supporting the UN SDGs.
There is an ongoing challenge that prospective projects tend to be insufficiently prepared for investment and therefore remain unfinanced.
Introduction To The
Cities Investment Facility
The Cities Investment Facility (CIF) is an innovative, multi-stakeholder initiative centered around unlocking private investment in urban infrastructure projects in low- and middle-income markets. While there is significant investor demand for bankable, construction-ready projects, these markets have traditionally struggled with the project preparation process and investment-readiness. This has resulted in an annual global infrastructure investment gap of US$3.2 trillion, with the vast majority of that in low- and middle-income countries. It is the Cities Investment Facility’s goal to significantly reduce this gap.
This goal is achieved by supporting project promoters with (i) the marketing of their projects to a global audience of construction-finance providers and/or long-term operations investors; (ii) advice regarding the project preparation processes of ideation, feasibility, development, and financial closure; and (iii) pre-construction funding (as both grant and private capital) for these processes, with the ultimate goal of securing construction/long-term financing from other external lenders and investors.
The Cities Investment Facility aims to significantly increase the amount of private capital for infrastructure projects (within UN-Habitat's existing geographical footprint) that are aligned with both the UN Sustainable Development Goals (SDGs) as well as city development plans. We see this as crucial to boosting sustainable development and addressing rapid urbanization which fuels the growing global annual infrastructure financing gap.
This goal is achieved by supporting project promoters with (i) the marketing of their projects to a global audience of construction-finance providers and/or long-term operations investors; (ii) advice regarding the project preparation processes of ideation, feasibility, development, and financial closure; and (iii) pre-construction funding (as both grant and private capital) for these processes, with the ultimate goal of securing construction/long-term financing from other external lenders and investors.
The Cities Investment Facility aims to significantly increase the amount of private capital for infrastructure projects (within UN-Habitat's existing geographical footprint) that are aligned with both the UN Sustainable Development Goals (SDGs) as well as city development plans. We see this as crucial to boosting sustainable development and addressing rapid urbanization which fuels the growing global annual infrastructure financing gap.
Cities Investment Facility Components
A series of three components work to engage city authorities, investors, and other stakeholders in CIF.
The CI Portal is an online subscription-based platform that hosts and tracks the progress of the sustainable urban infrastructure projects that have been admitted into CIF, as they make their way through project preparation towards bankable, construction-ready status. It is the first entry point into the programme, comprising a digital platform that enables cities to better promote their urban development projects to an audience of construction/long-term investors and third-party experts who can provide financing, technical and advisory support.
Learn MoreThe CI Advisory Platform is an incubated initiative responsible for supporting projects that successfully pass through initial assessment filters. The two elements of the CI Advisory Platform – bankability advisory and SDG assessment – provide Technical Assistance (TA) to selected projects, including project structuring, financial and technical due diligence, deployment of TA capital (grants, reimbursable financing, loans, guarantees), getting projects on the way to investment readiness, identification of blended-finance scenarios and investment pathways (domestic and international exposures), and SDG impact assessment using an SDG Project Assessment Tool.
Learn MoreThe CI Vehicles provide private-capital finance and further bankability guidance for projects that have reached the mid-stage of preparation, in order to drive projects to financial close with other, third-party construction/long-term lenders and investors. They are often those that have been prepared and de-risked to mid-stage with the assistance of the programme’s CI Advisory Platform partners, and now require the typically more significant investment needed to complete project preparation to a bankable, construction-ready status. . Part of this process includes assisting project promoters in securing the appropriate equity sponsors and lending institutions.
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