The next wave of urban investment
By 2025, U.S. infrastructure spending will exceed $1.3 trillion annually. Public budgets alone cannot sustain this pace—private capital and digital innovation are essential. Smart-city initiatives link mobility, energy, and public data in ways that cut operating costs and carbon emissions.
Table 1. Infrastructure Investment by Funding Source ($ B)
| Source | 2019 | 2023 | 2025 (f) |
|---|---|---|---|
| Federal & State Budgets | 680 | 830 | 870 |
| Public-Private Partnerships | 92 | 134 | 165 |
| Private Concessions & Funds | 48 | 72 | 90 |
Sources: BEA; U.S. DOT; InfraAmericas.
Table 2. Smart-City Technology Adoption (% of Large Cities)
| Technology | 2020 | 2023 | 2025 (f) |
|---|---|---|---|
| Smart Traffic Management | 28 | 47 | 59 |
| Digital Water Metering | 34 | 53 | 68 |
| Public Wi-Fi & IoT Networks | 41 | 55 | 70 |
Sources: Smart Cities Council; McKinsey Urban Index.
Strategic context
PPP models now fund everything from EV charging corridors to stormwater projects. Cities must balance innovation with cybersecurity and data privacy mandates.
Leadership takeaway
Develop cross-sector consortia to bundle projects and access blended finance. Operational efficiency and climate resilience are the new returns on infrastructure capital.