The downtown has been declared dead—a victim of COVID. Fewer people are frequenting restaurants and retail spaces in the city center, and more are spending in the suburbs. According to research from third-quarter 2023 covering 118 major cities in 50 countries, suburban spending has grown 15 percentage points more than that of downtown areas (the so-called doughnut effect).^[1]Ramani A, et al. “How working from home reshapes cities.” Economic Sciences. 2024;121(45):e2408930121. What was once a thriving socioeconomic central business district (CBD) ecosystem looks to be unraveling.

But our research suggests a different narrative: the world’s cities have arrived at a moment of reinvention and revival. It’s true that the city center is struggling, which our analysis of 38 CBDs and 13 of the world’s largest and wealthiest megacities confirms. We also identified several exceptions, however, with Tokyo the most notable. Already a model of urban innovation, the world’s largest city—home to more than 37 million people—has figured out how to adapt to new working norms.

In Tokyo, the CBD—traditionally a center for offices with large numbers of workers commuting from far-flung locations—is being transformed into what we call a knowledge campus. This new type of CBD attracts both businesses and talent, offering opportunity and optionality, and satisfying a wide cross-section of needs: company leaders who want to enhance productivity, employees who want opportunity for social interaction, commercial developers that want to keep their buildings filled with tenants and charge competitive rent, and cities that want to attract businesses and boost the tax base. In the future, even the office itself will be a microcosm of the CBD.