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Bill Gates' investment group spent $80 million to build a 'smart city' in the desert — and urban planners are divided

Business Insider spoke with several urban planners about Bill Gates' investment in land for a smart city in the Arizona desert.

  • A subsidiary of Bill Gates' investment firm has committed $80 million toward building a "smart city" in Belmont, a parcel of land in Arizona.
  • Business Insider spoke with several urban planning experts who disagree on whether it is the ideal place for a "smart city."
  • They list Arizona's low land prices, autonomous vehicle-friendly policy, and population growth as advantages. S
  • ome argue the location's ongoing water crisis and distance from Phoenix pose challenges.

An investment firm with ties to Bill Gates may have plans to build a "smart city" in the Arizona desert.

As the Arizona Republic reported earlier in November, Mt. Lemmon Holdings, a subsidiary of Gates' investment firm Cascade Investment LLC, bought land in southwestern Arizona for the construction of a 24,800-acre development consisting of residences; public schools; and office, commercial, and retail space.

In recent years, the term "smart city" has evolved beyond high-speed internet and embedded sensors to include characteristics like high density, affordable housing, access to mass transit, climate resilience, and ample green space. Business Insider consulted several urban planners, artificial intelligence experts, and policy managers to get their takes on whether southwestern Arizona is the best place to build one.

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They were torn.

Belmont is a huge parcel of undeveloped land — nearly the size of Paris — on the outskirts of suburban Buckeye, Arizona. According to Business Real Estate Weekly of Arizona,Mt. Lemmon Holdings paid around $7,500 an acre for Belmont — a relatively cheap price for land close to a city.

The area's low land prices could translate to an affordable standard of living for future residents, according to Alexis Crow, an investment advisor at PricewaterhouseCoopers who focuses on geopolitics.

In the past two decades, Buckeye has experienced a population boom, growing from 6,000 to around 60,000 people today. Crow said Phoenix, Buckeye, and the surrounding area's population could grow even larger, perhaps aided by the migration of tech workers from places like San Francisco and Seattle.

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To power charging stations for some of these cars — as well asCrow said Belmont developers could look to Arizona's ample capacity for solar energy production.

"After the latest set of hurricanes that hit Houston, Florida, and Puerto Rico, we have seen what happens to businesses when they have to completely shut down," he said.

Arizona is in the middle of an ongoing water crisis. Adding another city would likely strain the state's dwindling water resources even more, said Drew Beckwith, a policy manager at the water conservation nonprofit Western Resource Advocates.

Arizona, California, and Nevada share a water supply from Lake Mead on the Colorado River. Since the mid-1990s, the lake's water levels have dropped an average of 12 feet annually, Beckwith said.

By its very nature, a "ready-made city" usually doesn't allow neighborhoods to grow organically, he added.

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Mitchell Joachim, an New York City-based urban designer, points to Arcosanti as an Arizona "ready-made neighborhood." Built in the 1970s, it hasn't lived up to the original vision of a city with self-sustaining agriculture, thousands of residents, and 100% renewable energy. Joachim is more optimistic about Belmont.

However, Brent Toderian, principal at Toderian Urbanworks and former Vancouver chief planner, sees the location as a red flag.

"At first, second, and third glance, there’s not much that’s smart about trying to land even more people on the deep suburban edge in the desert — with or without distractions like driverless cars. In a land-use sense, that’s trying to put high-tech make-up on an unsustainable pig," he said.

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