From left to right: Mckinsey, Seattle, Bill Lee of Microsoft, speaking at the ULI Spring Meeting.

From left to right: Tyler Duvall, a partner with Mckinsey; Michael Mattmiller; chief technology officer with the City of Seattle; and Bill Lee, director, real estate, planning, and development with Microsoft, speaking at the ULI Spring Meeting.

The evolution of “smart” cities is about solving specific problems more than sweeping urban transformation, panelists emphasized during the 2017 ULI Spring Meeting. Targeted programs with clear benefits are defining smart cities, not the widespread embrace of new technology, they said.

In Seattle, “smart” means expanding the network of low-cost sensors, which is allowing for adaptive traffic signals and detailed weather mapping that can track microclimates and rain surges, said Michael Mattmiller, chief technology officer for the city of Seattle.

“Interesting and useful, but not terribly smart,” said Mattmiller during the panel, “The Future Is Now: Real Estate Opportunities in the Digitally Connected ‘Smart Cities’ of Today and Tomorrow.” Many of the game-changers for the city “probably don’t sound that game-changing to you,” he told the audience. “They are just seamless parts of our environment.”

The definition of smart cities means different things to different people, the panelists agreed. While discussions of creating smart cities often focus on technology overhauls on a large scale, most of the work today is focused on smaller-scale projects with definitive results.

A disconnect exists between the availability of technology and governments’ willingness to implement it, said panel moderator Tyler Duvall, associate principal with McKinsey & Company, the consultancy. “It’s not well understood how much bang we will can get for the buck,” he said.

A sluggish government remains one of the biggest impediments to widespread adoption of technology, said Duvall, who previously served as Assistant Secretary for Transportation Policy for the U.S. Department for Transportation. Governments are “not keeping up with the pace of change in the private sector,” he said.

There is a lot of talk about civil infrastructure projects, “but very little conversation about the installed base of assets we already have,” he said. From congestion management to air quality, it is hard to find a problem “that there is not a technology solution that somebody out there is working on,” Duvall said.

The challenge for the industry is, “How to do we take this huge amount of available technology and integrate it into cities?” he said.

To start, that means finding a model to “embolden leaders to basically be disruptive in a way that does not get them to lose their jobs” and to get them out of “this fiscal cocoon,” which is hampering investment in new technologies, Duvall said. Political support remains essential for most transformational infrastructure changes, creating a finance structure not always available in the private sector, he said. A rollout backed by a government contract is “extremely bankable,” he said.

The financial equations are still at the heart of many smart city calculations, said Bill Lee, director of real estate, planning, and development for Microsoft. The potential economic savings “is exactly why we will have autonomous cars,” he said, adding that human-driven cars are the “horse and buggies” of the future.

Microsoft has developed its own definition of smart communities, Lee said. Microsoft believes that “technology is already part of humanity,” he said. “When we look at our campus, we look at the human aspects of things.”

During the conference, Microsoft hosted a tour of its headquarters, which Duvall described as the “equivalent of a city owned by a company.” The trip included a visit to the Microsoft Envisioning Center, a prototype lab where the company creates working examples of technologies for the home and office.

“We look to provide examples,” Lee said. “We hope to convince cities they can do it, too.”

Seattle is “opportunistic” in its approach to embracing smart technologies, Mattmiller said. Funded projects are often “not things that change the world, but it helps government run more efficiently,” he said.

Even in notoriously progressive Seattle, public support can be hard to obtain, Mattmiller said. Early efforts to create censors and camera networks were shot down on privacy concerns, but later initiatives were embraced, because they provided value to the community, he said.

In many cases, it takes work to find the correct solution, he said. For example, a recent study found that low-income households may own a computer or a smartphone, but they may not have a data plan, which has helped focus the city on expanding data access and its free wi-fi network.

“When we identify new technology, how will people access it?” Mattmiller asked.

The city also wants to address “smart parking.” Studies show that close to 30 percent of driving in the urban core is people looking for parking spaces, he said. “What if we can make it more efficient and direct you to a parking spot?” Mattmiller said.

Seattle is taking a proactive approach to identifying appropriate technology, Mattmiller said. That includes expanding relationships with local academic institutions and the creation of a new staff position specifically focused on coordinating smart city initiatives across different departments.

One of the lessons learned from fledgling efforts is that cities often do not look far enough ahead, Lee said. Plan for the future, not today, he said. “I’m learning [that] you need a lot more censors on infrastructure than you think you do.”

On its campus, Microsoft stresses flexibility. “Everything needs to be flexible for different uses,” Lee said.

Governments are wrong to expect the private sector to wait for public guidelines on technology rollout, Duvall said. Companies like Uber went to market and established an installed base—and then forced local governments to react.

“In the transit space, it’s not like these [next-generation] companies are going to come to a transit agency and ask for approval,” he said.

The United States is about to enter a “big civil reconstruction of the country,” which will push cities to address many of these questions, Duvall said. Developing new infrastructure for water, transit, and the environment is “the great challenge of our time,” he said.

Governments are going to continue to adapt, even if it is at a slower pace than many in the industry would like, he said. “There is not a business model to do something about it,” Duvall said. “And it’s not just the federal government throwing money at it; that’s not going to solve it.”