• NextMetropolis
  • Posts
  • Federal Building Fire Sale in D.C., Incomplete Future City Xiong’an, the $100B+ Chip Factory Race, Mass Timber Rising

Federal Building Fire Sale in D.C., Incomplete Future City Xiong’an, the $100B+ Chip Factory Race, Mass Timber Rising

Author

Editorial Staff
May 11, 2026

 

Our latest newsletter explores the major projects and trends shaping tomorrow’s cities.

You Should Know

  • Global infrastructure spending is forecast to rise from $4.4 trillion annually to $6.9 trillion by 2050, according to PwC's newly released Global Infrastructure Outlook. Spending will be led by transport, power, and the data center boom. Asia-Pacific dominates investment, while Africa is forecast to grow fastest.

  • Mexico City is sinking about 2 cm per month, as confirmed by new NASA satellite imagery. The extreme subsidence is largely due to excessive groundwater pumping beneath the former lake bed on which the city was built.

  • The ongoing Global Flourishing Study, the world's largest empirical investigation of human flourishing (e.g., happiness, well-being, financial stability) ever undertaken, has opened its data to the public.

Worth Watching

A Federal Building Fire Sale Is Underway in D.C.

The U.S. federal government is selling off many of its most prominent buildings in Washington D.C. at a rapid pace, and the urban development consequences for the nation's capital could be profound.

The General Services Administration (GSA) has flagged approximately 50 properties nationwide for accelerated sale, including multiple buildings in Washington D.C. The D.C. properties cover roughly 250 acres between the National Mall and D.C.'s Southwest waterfront — a contiguous corridor nearly the size of the National Mall itself. Few locations in the country carry more redevelopment potential: this is one of the nation's most land-scarce cities, steps from federal landmarks and transit access.

The first sale set the tone: in March, the GSA sold a nearly one-million-square-foot building near L'Enfant Plaza to Dalian Development for $24.3 million, or less than $26 per square foot — a price that reflects both the steep decline in office values since the pandemic and the difficulty of repositioning buildings of this scale. For comparison, office space in Midtown Manhattan regularly sells for over $300 per square foot.

The largest building on the GSA's accelerated disposition list is the USDA - AG South building, located at 1400 Independence Avenue SW, spanning over 2 million square feet.

The rationale for the sales is straightforward. The federal government carries $50 billion in deferred maintenance expenses across its owned portfolio — a portfolio so neglected that none of the more than 9,700 buildings at 22 large federal agencies are meeting the 60% occupancy threshold required by law. GSA has projected that the D.C. sales alone will eliminate $5 billion in deferred maintenance and annual operating costs.

But the pace has alarmed planners, developers, and civic leaders. No overarching redevelopment plan exists to guide what the neighborhood will look like, and critics argue that selling to the highest bidder without a coordinating framework is a costly mistake. Uncertainty drives prices down and narrows the field of qualified developers — Dalian's purchase price for a building approaching one million square feet suggests the fire-sale risk is already materializing.

The buildings are too large, and the submarket too significant, for uncoordinated redevelopments to deliver the kind of transformation the area is capable of. Realizing the corridor's potential requires tying individual sites together under a coherent vision.

Several alternatives are under discussion. The D.C. mayor's office has proposed a fund in the city's 2027 budget that would allow the District to purchase federal properties directly and offer rebates to developers repositioning buildings. Others have suggested the GSA ground-lease the parcels rather than sell them outright, preserving long-term public ownership of land steps from the National Mall.

The opportunity itself is not in dispute. The southwest corridor has long been a concrete-heavy district navigated mostly by the federal workforce. Repositioned thoughtfully, it could become one of the most vibrant mixed-use districts in the country. The question is whether the government's urgency to cut costs will leave enough time to get it right.

China Is Building a New Megacity Next to Beijing, But It Won't Fill Up

Nine years ago, China declared a city into existence. A stretch of low-lying farmland and wetlands 100 kilometers southwest of the capital — prone to flooding, sparsely settled, and largely forgotten — was designated one of the most important urban development project in modern Chinese history. Xiong'an New Area was a "millennium plan," authorities announced. Construction would begin immediately.

The megaproject aims to solve Beijing's particular problem. The capital holds roughly 23 million official residents — only 1.5 percent of China's total population — yet hosts a disproportionate share of its government ministries, state-owned enterprise headquarters, elite universities, and research institutions.

President Xi Jinping's solution was not to fix Beijing, but to relieve it. Xiong'an was designed to absorb the bureaucratic infrastructure that doesn't need to be in the capital, while Beijing retained its role as China's political center. The new area ranks alongside Shenzhen and Shanghai's Pudong as one of three "special zones of national significance," under direct CCP Central Committee oversight.

The ambition goes beyond administrative reshuffling. Xiong'an is designed as a 15-minute city — every resident within walking distance of daily goods and services, with a forest within 3 kilometers, a green belt within 1 kilometer, and a park within 300 meters of every home.

Its digital infrastructure was embedded before residents arrived: every building, road, and pipeline carries a digital ID, traffic signals adjust in real time using AI, and a central computing center processes over 38 billion data entries while managing city services.

Economically, it is deliberately closed to foreign investment — an engine for state-owned enterprises and domestic firms, where Shenzhen was built on global capital.

Nine years in, the physical progress is real. More than 5,000 buildings have risen across 215 square kilometers. Over 400 state-owned enterprise branches have set up operations. Sinochem, China Huaneng Group, and China Satellite Network Group have relocated headquarters from Beijing. A high-speed rail link connects the city to the capital in 30 minutes.

But Xiong'an's 1.41 million residents fall well short of its 5 million target for 2035, and construction is behind schedule. The challenge is less engineering than human: civil servants widely regard a posting to Xiong'an as a career demotion, since proximity to Beijing's power centers carries advantages no rail connection replaces. Housing restrictions designed to prevent speculation also dampen organic demand.

When Xi visited in March 2026 — his fourth inspection since 2017 — he urged officials to "throw themselves into the work of implementation." The 2035 deadline remains official. Whether administrative pressure alone can close the gap between what Xiong'an was designed to be and what it currently is remains the central unresolved question.

Got $100 Billion? SpaceX Enters the Epic Chip Factory Race

SpaceX is planning to build one of the most expensive semiconductor manufacturing facilities ever constructed, joining a chip manufacturing race that is already reshaping land markets, power grids, and local economies across the U.S.

The Texas-based facility, called Terafab, is designed to produce chips that will power AI, robotics, and space-based data centers for Elon Musk's companies — SpaceX, Tesla, and xAI. Announced in March 2026, the project's long-term goal is to produce enough chips to support one terawatt of compute capacity per year.

SpaceX has filed a public notice in Grimes County, Texas, revealing an initial investment of at least $55 billion, with total spending across all phases potentially reaching $119 billion.

That investment puts Terafab in rare company, though not yet at the top of the table. Taiwan Semiconductor Manufacturing Company's planned Phoenix campus, which includes up to 12 facilities spanning fabs and advanced packaging plants, represents roughly $165 billion in total investment. Micron Technology's planned megafab in Central New York is projected at $100 billion spread across two decades and up to four facilities.

Where Terafab would be genuinely unprecedented is not in raw dollars but in architecture. Existing fabs specialize, with separate sites handling logic chips, memory, and packaging. Terafab proposes to integrate every stage of that process under one roof, something no facility currently does anywhere in the world. Musk has described it as the most epic chip-building effort ever, one that combines logic, memory, and advanced packaging under one roof.

The ripple effects of projects at this scale are already visible elsewhere. Adjacent to TSMC's Phoenix campus, developers are building Halo Vista, a $7 billion, 2,300-acre mixed-use development with nearly 30 million square feet of industrial, residential, research, retail, hospitality, and commercial space. It is a preview of what large-scale semiconductor investment can do to surrounding land markets.

The project is structured in two stages. The first is a prototype plant being developed at Tesla's existing Gigafactory Texas campus in Austin, targeting 2-nanometer process technology. The full-scale Terafab, which Musk says will require thousands of acres and more than 10 gigawatts of power, would be built at a separate, larger site in Grimes County, where local officials have signaled support and emphasized that the project is a manufacturing operation expected to bring long-term jobs to the county.

Tesla's fifth-generation AI chip, AI5, is the pilot facility's first planned product, with small-batch production in 2026 and volume production in 2027. At full scale, Terafab would target one million wafer starts per month and between 100 and 200 billion chips annually.

Wood Is Back: Mass Timber Is Shaping the Future of Construction

The construction industry accounts for 35% to 40% of global carbon emissions, and a family of engineered wood products is emerging as one of the most credible structural responses to that problem.

Mass timber is not traditional lumber. It refers to engineered wood products created by bonding smaller wood elements together using adhesives, dowels, nails, or screws to produce large structural components capable of replacing steel and concrete, with strength-to-weight ratios that often exceed reinforced concrete while storing the carbon the tree absorbed during its lifetime.

The product family is broader than most people realize. Cross-Laminated Timber (CLT), the most widely used type, stacks layers of lumber in perpendicular orientations to create panels suited for floors, walls, roofs, and elevator shafts. Glue-Laminated Timber (Glulam) bonds parallel laminations together, making it the go-to for beams, columns, and long-span structures. Nail-Laminated Timber (NLT) fastens dimension lumber on edge mechanically, valued for its natural aesthetic and fire-resistance ratings.

The advantages are measurable. Life Cycle Assessments consistently show mass timber buildings achieving 22% to 50% reductions in embodied carbon compared to equivalent concrete structures, and when accounting for stored carbon as well, the global warming potential can drop 80% to 90%. Wood's light weight lowers foundation requirements, and exposed timber finishes eliminate the cost of additional interior materials.

The disadvantages are real but narrowing. High installation costs, susceptibility to moisture and decay, and historically difficult insurance markets remain genuine friction points. Regulatory barriers have also slowed adoption, as building codes in many markets capped timber construction at six stories or fewer, though fire testing is rapidly changing that picture.

Mass timber chars on the outside when exposed to heat, and that char layer insulates the structural core beneath. Burnout tests conducted in 2016 at Mjøstårnet, the 18-story, 85-meter mass timber building in Norway, proved that large glulam columns would self-extinguish after a fire, validating the material's performance at height.

One of the most notable mass timber towers in the U.S. is the 25-story Ascent tower in Milwaukee. The structure was erected 25% faster than a comparable concrete tower, and its wood stores the carbon equivalent of removing nearly 2,400 cars from the road.

With momentum on its side, the global mass timber construction industry is projected to reach $1.5 billion by 2031, with buildings above eight stories as the fastest-growing segment. Among timber types, NLT is leading growth, largely because its fire-resistance ratings align well with building codes in East Asia.

Big Deals

Extra Reads