Amsterdam on a roll

Amsterdam on a roll

With a relatively small population of just under 900,000, Amsterdam is hardly a typical global city. But it can challenge for international leadership when it comes to a green economy.

Many paths lead to the Paris accord for a net zero carbon planet by 2050 and Amsterdam appears to be pursuing several of them. In November 2021, the 32 municipalities that make up the Metropolitan Region of Amsterdam (MRA) signed the Green Deal Timber Construction mandating that 20 percent of all new housing projects in the Dutch capital and neighbouring towns and cities be constructed with wood or other bio-based materials from 2025. Amsterdam itself already boasts HAUT, one of the world’s highest wooden residential towers and the biggest in the Netherlands.

Circular construction, which seeks to reduce the use of materials in the building process and recycle as much as possible, is just one of the strategies that Amsterdam is adopting as part of its efforts to minimise carbon emissions. The city council aims to redesign 20 product or material chains as part of an innovation programme on the circular economy, including projects to convert waste into electricity, urban heating and construction materials. Amsterdam feels a bit like a village, but it’s really a global exemplar when it comes to the green economy, according to Lisette van Doorn, CEO of the Urban Land Institute Europe. The city is punching above its weight in so many areas, she adds. “Paris has declared it wants to become a 15-minute city, but a lot that Paris aspires to be, has been in place in Amsterdam since long before the concept became so hot.”

One of Amsterdam’s key assets is its attractiveness to talent: young people love the city, the quality of life and the ability to cycle anywhere. That’s a huge advantage, she notes: “Nowadays real estate investors as well as businesses follow people, not the other way round.”

A recent report by ULI on the Attractiveness of Global Business Districts highlighted Amsterdam’s standing as a business- friendly city, ranking its Zuidas?business district in 15th place worldwide. Amsterdam has also been a beneficiary of Brexit in terms of business relocations from London to the European continent. “The relocation of the European Medicines Agency, for example, has been a catalyst in attracting different types of businesses in life sciences and well-being,” Van Doorn says.

The Dutch capital is unique because although it is an established capital, it’s also very much like a new world city that is leading in technology-led sectors, culture and innovation, and in balancing the agenda for business with the agenda for the planet, lifestyle, talent and people, as urbanist and global advisor Professor Greg Clark told a recent Amsterdam Economic Board webinar.

“Amsterdam is in business in the things that the world really needs,” he said.

The city has a strong focus on entrepreneurship and innovation and tech-focused growth sectors such as cleantech, foodtech, life sciences, e-commerce and fintech. By incentivising early-stage startups, it will continue to attract global and European venture capital investment, Clark predicted. Amsterdam is a global leader, if not “the” global leader in the circular economy, he added.

“It’s also being recognised as a successful global hub for startups and is already the third most important centre for ‘unicorns’ in Europe.”

TechMeUp

Amsterdam has recently embarked on several initiatives to attract workers to growth industries such as IT, including TechConnect, a partnership with local businesses Booking.com, TomTom and Rabobank. Together, they have created socalled TechGrounds – or hubs – to attract students and workers in disadvantaged neighbourhoods, as well as TechMeUp, a fund that provides financial support for (re)training.

Amsterdam’s Hydrogen Hub is another example. A public-private alliance between the municipal and provincial authorities, the Port of Amsterdam, Schiphol Airport and local energy and?steel companies, Hydrogen Hub aims to accelerate the transition to hydrogen and ultimately create CO2-free steel and clean fuels for sea and air transport. The city has the ideal ingredients for the transition thanks to the extensive gas and fuel supply infrastructure in the region and a world-class local cadre of scientists in the field of hydrogen technology.

Amsterdam is also a leading city in a very important integrated “macrometropolis” comprising The Hague, Rotterdam, Utrecht and Eindhoven. These five cities are super-connected with each other, complementary and interdependent, Clark pointed out. “There are very few places around the world that have this kind of unique advantage. The ability to be a region of seven million people at the same time as being a greater metropolitan area of three million people brings advantages in education, connectivity, innovation and creating a managed approach to liveability.”

Affordable housing remains scarce

Socially and economically Amsterdam ticks many boxes, but one area where it is seriously challenged is in the provision of affordable housing.

Amsterdam is one of the few cities in Europe that owns a lot of land, which gives it?a huge advantage and a lot of control. However, in the Netherlands generally, and in Amsterdam in particular, housing development is approached in quite an isolated way, Van Doorn says. “Ultimately, to be successful, it requires an integrated long-term vision, not only related to housing, but also commercial development and infrastructure. Developing on a larger scale allows the private sector to do this and compensate lower returns related to social and affordable housing with higher returns on the commercial development.”

She points to the examples of Vienna and Copenhagen, where long-term visions were created to develop or regenerate larger parts of these cities. By focusing on larger tracts of land, it’s easier to create a mixed-use environment including social?and affordable housing, offices, green spaces, parks, schools and playgrounds, where public and private sectors work together to create this environment, she adds: “Amsterdam doesn’t take that integrated approach.”

Amsterdam needs to embrace urban planning strategies such as land use reform and densification to create a medium-density environment with a high level of functionalities, which is already occurring in the Zuidas business district, but not at a city-wide level. The Zuidas is a world-class business location with?many amenities and a real effort is now being made there to include housing, not just high-end apartments but also affordable accommodation, Van Doorn says: “That’s an important shift.”

Densification is vital alongside integrated mixed-use areas and putting the right infrastructure in place ahead of the real estate development, she adds. “Following that ‘triangle’ leads to a viable business model. Density and multiple functions result in a more intensive use of the space and hence a more profitable investment. And then the infrastructure, both transport and social, becomes affordable.”

This triangular business model approach to urban planning was included in the recommendations of a report from a ULI advisory committee on how to accelerate the redevelopment of Amsterdam Haven-Stad (Port City) – an ambitious plan to transform 650 hectares of existing docklands into one of the largest inner-city mixed-use residential districts in Europe. The infrastructure to connect this new area with the city centre and the rest of the metropolitan region is seriously lacking. A similar disconnect faces the northern part of Amsterdam, which is developing apace since the opening of the Eye film museum on the IJ River waterfront. While a north-south metro line connects the Zuidas business district with North Amsterdam, it is still necessary to take a ferry from the city’s central station to cross the river.

Part of the problem with large infrastructure projects is that the municipal authorities are not the sole decision maker when it comes to financing them, Van Doorn points out. The national government looks at such projects from a cost perspective, but ignores the broader KPIs like economic growth and indicators such as social equality to make a business case.

Amsterdam would do well to explore some of the public-private financing models used elsewhere in Europe, such as in the UK and Denmark, she concludes:

“There’s a huge social return if the right infrastructure is in place, especially given the enormous need for affordable housing. Amsterdam really needs to think big in this regard and plan for the coming decades.”

By Judi Seebus