A Smart City Is One That Works

Every time the subject of smart cities comes up, someone pulls out the same image: drones, sensors on every lamppost, mirrored screens. I have lost count of how many presentations I have seen open that way. And I will be direct: I think it is a poor starting point. Not because technology does not matter (it does!), but because it is the easiest part of the equation. Sensors can be bought. The hard part is everything else.

What makes a city truly smart

A smart city is one in which urban planning, mobility, public space and economic activity work for the people who live in it. Technology supports that outcome, but does not replace it.

The rest, therefore, is urbanism, architecture, economic activity, a sidewalk you feel like walking along at nine at night. A neighborhood only deserves the adjective "smart" if it works for those who live in it. Otherwise, it is expensive infrastructure in search of a purpose.

Brasília's lesson for urban design

Brazil has a particular relationship with this subject, and we do not always realize it. Brasília was born on a drawing board, was recognized by UNESCO as a World Heritage Site in 1987 and, more than sixty years later, keeps teaching that urban design shapes behavior for decades. A wrong building can be demolished. A wrong city cannot. Those who structure urban projects today should carry this lesson with a little more humility.

Real estate no longer sells square meters

In my daily work with our team, I insist on a thesis that sometimes sounds exaggerated, but I stand by it: the real estate market stopped selling square meters a long time ago. What we design, whether we like it or not, is the routine of thousands of people: where they work, where they walk, how much time they lose in traffic. It is an uncomfortable responsibility. And it is good that it is.

Metrics that matter beyond GSV

That is why structuring or managing a project with smart city ambitions requires looking at metrics the market does not always like to face. Occupancy rate and immediate GSV (General Sales Value) say a lot about the present and almost nothing about longevity. A development can be launched 100% sold and age badly. The opposite also happens: projects that take time to mature and, twenty years later, anchor entire regions.

A well-conceived urban project attracts technology companies, research centers and qualified services. But that is a consequence, not a starting point. The starting point is more prosaic: urban mobility that works, well-kept public space, real green areas, not the decorative flowerbed at the entrance. When that foundation exists, capital arrives. When it does not, no app can make up for it.

Sustainability is not a label

I approach ESG in real estate with some caution, because the acronym has been repeated so much that it has almost become a rubber stamp. But the fundamentals remain solid: there is no urban intelligence without a concrete response to climate change. Energy efficiency, waste management, rational water use, lower carbon footprint materials... None of this is rhetoric. It is project specification, construction cost, operating expense.

At inVista, we treat these metrics as part of governance and risk control, on the same level as financial variables. Not out of idealism, but out of pragmatism: assets that ignore these criteria lose liquidity and age fast. A Cushman & Wakefield study of corporate buildings delivered in Brazil between 2010 and 2020 showed that LEED-certified buildings charge higher rents, have lower vacancy and saw a 21.4% rise in average sale price per sq m over three years. Some assets become obsolete before the keys are handed over. Well-positioned ones, on the other hand, go through cycles with greater resilience.

Brazil can lead urban development in Latin America

Brazil has real conditions to lead new forms of urban development in Latin America. We have a history of bold planning, pent-up demand and a capital market mature enough to finance long-cycle projects. What is missing, in my view, is less fascination with the aesthetics of the future and more discipline with the fundamentals of the present.

That is what I believe in and how we work: a smart city is not announced. It is built and, above all, managed over time.

About the author

Marcelo Rezende Rainho Teixeira, CQF, is founding partner of inVista Real Estate, an asset manager operating in Brazil and the United States. Connect on LinkedIn

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