After my post on charter cities, I received some interesting feedback from Michael Strong, CEO of MGK Group, the company investing in Honduras’ charter cities and Brandon Fuller, a Research Scholar at NYU’s Urbanization Project. The Urbanization Project is headed by Paul Romer who is no longer involved with the Honduras effort.
Both stressed that their visions of charter cities do not rely on heavy-handed urban planning or much initial infrastructure. Brandon, speaking from his own perspective rather than on behalf of the Urbanization Project, said that he views the role of charter city investors as building arterial roads and providing some open space. The charter city government would not set any parking requirements or height limits, so the market would drive urban form at the block level. He writes:
For planning, we favor a decidedly light touch approach. Our thoughts on planning are influenced by our colleague Solly Angel, an adjunct at NYU and one of our principal researchers at the Urbanization Project.
Michael explained that the charter cities where MGK is investing will draw more from LEAP zones than from Romer’s charter city model. One important distinction is that MGK is purchasing land where these zones will be located whereas Romer suggests charter cities should be built on land donated by the host country. He writes:
The Honduran government is not designating a specific location for us. The current proposal is for them to designate fairly large regions within which we can identify specific parcels and sub-regions that are most appropriate for getting started.
While Brandon might support a larger role for city leadership in building a street grid than Michael does, both made clear that urban development should fall to entrepreneurs rather than charter cities’ initial investors or governments. Both envision that a change in the rules governing the sites of charter cities will draw people who previously lacked an option for living under free market institutions.
As Brandon explains:
The conjecture behind charter cities is that rules, or institutions, play a significant differentiating role. In other words, there are lots of places around the world that, but for lack of effective governance, would be successful cities based on geography and accessibility. What’s more, there’s plenty of pent up demand for life in well-run cities that is not currently being met.
