LONDON (Thomson Reuters Foundation) - The doors of the Carnegie Library in Herne Hill, a leafy south London suburb, shut for the last time seven months ago after the cash-strapped local city government decided the building had not been used to its full potential.

To the dismay of locals, the 100-year-old listed building might now be turned into “healthy living center”, including a gym and a self-service library or, if campaigners’ worst fears materialize, it will be sold and turned into apartments in the sought-after area.

The library was built with money from 19th century Scottish-American steel magnate and philanthropist Andrew Carnegie, one of 3,000 public libraries he funded in Britain, the United States, Canada and other English-speaking countries.

Like Carnegie at the turn of the 20th century, philanthropists around the world are pouring money into a global drive to make cities more liveable and sustainable for their citizens.

“If you look at history you see that philanthropy is a largely, though not exclusively, urban phenomenon,” Bradford Smith, president of the U.S.-based Foundation Center, a non-profit that gathers and analyses data about philanthropy, told the Thomson Reuters Foundation.

Decisions like the one to close Herne Hill’s Carnegie library illustrate where philanthropic foundations can step in to ensure local services are being kept alive when government budgets are tight.

While city government decisions are often driven by political or financial pressures, philanthropic foundations can operate without or with less of those constraints, said Smith.

They also often bring decades of local knowledge about their communities to the table and invest in the “soft infrastructure” of cities, such as arts, culture and education.

DEEP URBAN KNOWLEDGE

Leong Cheung, executive director of charities and communities at the Hong Kong Jockey Club, said through its more than 130-year history the club has built a strong relationship with the city and a deep understanding of community needs.

A large share of losing bets contributes directly to the welfare of Hong Kong’s society through charitable contributions by the club, making it the world’s six-largest charitable foundation, according to the World Charity Index 2015.

In the past year, the non-profit invested almost HK$3.9 billion ($503 million) by supporting more than 200 charities and community projects working on arts and culture, elderly and family services, medical and health as well as sports, recreation and youth.

“We seek out the root causes of social issues, and collaborate with a strong network of partners - including government, non-governmental organizations, academia and businesses...The ultimate goal is to create social impact,” Cheung told the Thomson Reuters Foundation.

The number of philanthropic foundations is growing around the world, most notably in the United States, home to more than 86,000 foundations with $715 billion in assets, compared to 4,000 in 1960, according to Foundation Center data.

They gave $52 billion to good causes in 2012 but there is no exact data on how much philanthropic money has been spent on cities, either in the United States or elsewhere.

Experts said due to a lack of data and only a small number of networks that link philanthropic funders working on cities there is a risk that funding does not always go where it has the most impact or that money is spent on a small selection of needs.

“Within the broader landscape of giving...we still have a significant evolution to make in terms of how we connect philanthropic money to the best possible places to deploy it,” said Robert Rosen, director of philanthropic partnerships at the Bill and Melinda Gates Foundation.

BIG MONEY FOR CITIES

The magnitude of funds received over the past decade to tackle urban challenges and a strategic focus on issues such as climate change and good governance is unprecedented, experts said.

The Rockefeller Foundation has spent $100 million on its 100 Resilient Cities initiative to help cities globally to build strategies against climate change and other shocks.

Set up in 2013, it provides funding to cities to build a resilience strategy and appoint a chief resilience officer. It also provides a network of member cities who can learn from each others’ experiences.

“One of the benefits of building a network is that we’re able to aggregate the needs, challenges and gaps that we’re seeing across cities - and help spur innovation through sharing knowledge,” Michael Berkowitz, president of 100 Resilient Cities, told the Thomson Reuters Foundation.

Among other leading city philanthropists is former New York mayor Michael Bloomberg, who has channeled millions into helping cities to improve the ways urban government works and supporting mayors to improve city life and address climate change.

Philanthropy stepped up big time during Detroit’s 2013 bankruptcy, when major contributions from organizations such as The Kresge Foundation, Ford Foundation and Community Foundation helped to save the Detroit Institute of Arts and stave off draconian cuts to pensions of municipal retirees.

($1 = 7.7558 Hong Kong dollars)

The Hong Kong Jockey Club provided a travel grant for this story.