University of Miami Launches Resilience Finance Lab to Unlock Private Capital for Climate Resilience

On land once occupied by a par 3 golf course, the City of Miami Beach is successfully combating heavy rainfall and rising sea levels that frequently flood its streets. The city has constructed a park that functions essentially as a giant sponge.

Indeed, the 19.4-acre Bayshore Park, which opened last year, is far more than just green space. Its central lake collects, retains, and naturally filters stormwater runoff, mitigating flooding in the surrounding neighborhood and protecting nearby Biscayne Bay.

The park, which addressed a longstanding need for the city, was funded through a combination of municipal funds and a voter-approved general obligation bond.

However, funding resilience projects designed to proactively harden infrastructure and mitigate risks before a natural disaster strikes has proven far more challenging. “It becomes a payer problem,” said Michael Berkowitz, executive director of the University of Miami’s Climate Resilience Institute. “Who wants to pay for damage that didn’t happen?”

Now, a new Resilience Finance Lab, developed by the institute in partnership with the John S. and James L. Knight Foundation and with input from JPMorganChase, aims to ensure that such preemptive resilience projects transition from the drawing board to reality.

Housed at the Climate Resilience Institute and developed in collaboration with the University of Miami School of Business, the lab addresses a critical gap in resilience financing: a focus on market building to better engage private sector actors and accurately reflect the benefits of risk reduction and resilience.

“Ultimately, resilience investment works, helping to reduce losses, protect communities, and strengthen balance sheets,” he explained, noting that across the country, engineers, local governments, planners, and community organizations have a clear vision of the projects that need to be implemented.

“At the same time, there is a vast pool of capital—from investors and insurers to ratings agencies, lenders, and policymakers—available to fund such projects. However, it is not moving toward resilience at the required scale,” Berkowitz continued. “What is missing is the market infrastructure that connects these two worlds. Without it, capital allocators and project sponsors cannot price the true value of resilience, and the gap between what needs to be done and what gets funded continues to widen.”

Unveiled on Sept. 22 at BlackRock in New York City during Climate Week NYC, a seven-day gathering attended by several University of Miami faculty members, the lab is designed to bridge that gap—not by funding projects directly, but by catalyzing the market infrastructure that makes resilience investment legible, bankable, and scalable. “In essence, we will bring together leaders from academia, government, philanthropy, finance, and the private sector to advance innovative solutions for financing resilience,” Berkowitz said.

“The old model is to finance recovery after a disaster. The new model must finance resilience before a disaster even strikes,” said Paul A. Pavlou, dean and Leonard M. Miller Professor at the University of Miami Business School. “Miami sits at the intersection of climate risk and access to capital, giving us both an opportunity and a responsibility to lead. The Resilience Finance Lab can help make resilience investable by turning risk reduction into measurable economic value and mobilizing capital toward stronger communities, stronger companies, and a stronger future for everyone.”

Resilience is not simply about preparing for the next disaster, said Joel H. Samuels, University of Miami executive vice president for academic affairs and provost. “It is about making smart investments today that protect communities and create value for the future,” he said. “The Resilience Finance Lab brings together the expertise and perspectives needed to address one of the field’s most persistent challenges: how to turn the benefits of resilience into investments that communities and capital providers can recognize, evaluate, and address.”

Economic relief drives the urgency for solutions like the lab, said Francesca de Quesada Covey, vice president of community impact at the Knight Foundation. “At Knight, we know communities thrive when they are stable in the face of external shocks, including those caused by extreme weather. Our investment in the Resilience Finance Lab will support its work helping financial markets better price in risk reduction, translating into lower costs for the communities and people that need them most,” she explained.

Ambitious goals

The lab has set an ambitious agenda. Among its goals:

• A convening program that continues and builds on existing work, including the institute’s Resilience 365 conference, working sessions alongside major events, and new convenings designed to deepen the practitioner-capital allocator dialogue the lab has already begun.

• A publicly accessible map of the resilience finance landscape—who is doing what, where the gaps are, and where collaboration is needed.

• Goal-oriented working groups focused on the field’s highest-priority challenges, beginning with resilience valuation and financial instruments. Each will have a clear mandate, a defined work program and senior leaders from both practitioner and capital allocator worlds at the table, according to Berkowitz.

• Seeding research initiatives where critical gaps exist and launching so-called lighthouse projects that act as models for larger programs.

“We’ll be selective about where we focus our energy,” Berkowitz said. “The projects we’ll support will be initiatives that are public, with structure, financing terms and outcomes available for the field to learn from—catalytic, demonstrating something the market has not yet done; scalable, with a financing model that does not depend on one-off conditions; and designed to generate transferable learnings.”

The lab will also launch this month a searchable repository of relevant studies and research, allowing users to review effective initiatives that may inspire their own projects.

The lab will draw on expertise across the University, from its Rosenstiel School of Marine, Atmospheric, and Earth Science to its School of Business, College of Engineering, Miller School of Medicine and School of Architecture.

“In order for us to meet the daunting challenges of building resilience, we must leverage philanthropic, government and private-sector capital in innovative ways. This new work by the University of Miami group is intended to develop and align innovation to support funding and finance needs that will benefit communities in South Florida, the United States and around the world working to protect themselves and reduce risk,” said Judith Rodin, president emerita of the University of Pennsylvania, who serves as co-chair of the Climate Resilience Institute’s external advisory board.

Berkowitz, who founded and built the Rockefeller Foundation’s 100 Resilient Cities, will lead the day-to-day operations of the lab. Its work will be overseen by a steering committee that brings together founding funders and independent experts representing diverse experience across resilience practice, capital markets, policy and finance.

“The committee already reflects the seriousness of the field’s engagement,” Berkowitz said. He noted that Sarah Kapnick, JPMorganChase’s global head of climate advisory and former chief scientist at the National Oceanic and Atmospheric Administration (NOAA), brings the perspective of one of the world’s largest financial institutions to the lab’s agenda. “And that’s a signal that the capital markets are ready for this conversation,” he said.

“Building the kind of infrastructure at the scale needed for communities to face the challenges of the 21st century will require public- and private-sector investment. While we have ample evidence of strong benefit-cost ratios for resilience investment, monetizing these benefits so that capital markets can support funding has proved challenging. That’s why we are excited to work with the Resilience Finance Lab on innovation to address this,” Kapnick said.

The lab comes as the nation continues to face a multitude environmental crises each year. From tropical cyclones and winter storms to heat waves, flooding and wildfires, the U.S. experienced 27 confirmed billion-dollar weather and climate disasters in 2024, resulting in approximately $182.7 billion in total damages and 568 deaths, according to NOAA’s National Centers for Environmental Information.

“This year, we’ve had a relatively quiet Atlantic hurricane season. But in many other places, we’re seeing considerable climate disasters. And for those reasons, we need to focus on continuing to build our resilience,” Berkowitz said.

“Having worked with Michael to convene on this topic for the past year, it’s clear that there’s massive demand from both project proponents and capital allocators for innovation that moves more private capital, especially to resilience efforts,” said Tucker Van Aken, co-founder of Planetary PS, an impact advisory firm that helped incubate the lab. “The challenge is identifying and, ultimately, expanding the benefits that private capital can effectively value and underwrite, which requires creating innovative financing mechanisms, methodologies and proof points that can help accelerate and scale private investment alongside more traditional public sources of funding. That’s the work of the lab.”

The challenges ahead

Overcoming the obstacles that prevent some resilience projects from going forward remains a formidable challenge, and the reasons for those obstacles can run the gamut, according to David L. Kelly, professor of economics and academic director of the Master of Science in Sustainable Business at the Business School.

“Coastal communities may not have the necessary tax base to finance resilience investments, which, like all infrastructure these days, is very expensive,” Kelly said. “Resilience investments may affect several communities at once. It is difficult for the communities to get together and agree on how much each will pay. Each has an incentive to understate the benefits and free ride off the investments of others. Many financing mechanisms require that the investments show tangible benefits to the community—for example, reduced flooding. And it can be difficult for communities to show this in a convincing way to financiers.”

Kelly also noted that some residents do not always believe academic or government studies that show the benefits of resilience projects outweigh the costs. But some studies by University of Miami researchers, including one by Kelly himself, have demonstrated how such projects are, in fact, beneficial.

In a recent publication looking at about 160 projects and more than 400,000 property transactions in Miami-Dade County, Kelly and a colleague showed that resilience infrastructure increases property values. “In this sense, the projects are beneficial because people are willing to pay more for properties near newly completed projects. In particular, after infrastructure is built, property values in newly protected areas increase by about 5 percent more than unprotected areas,” said Kelly.

“Large visible projects like raising streets have the highest benefit, up to about a 20 percent increase, with benefits highest near the coast,” he said. “The gain in property values exceeds the cost of infrastructure for the vast majority of projects.”

Berkowitz said the importance of natural infrastructure shouldn’t be forgotten in the overall discussion about resilience. Coral reefs, he noted, act as “blue barriers” that shield coastal communities, protecting thousands of miles of coastline from erosion and storm surge by absorbing a significant amount of wave energy.

Berkowitz said the new Resilience Finance Lab is prepared to meet the challenges that lie ahead.

“Our ultimate goal,” Berkowitz said, “is to change how capital flows so that it more organically finds resilience projects that we know provide long-term value. We’re committed to operating as a public good. Our research outputs will be openly available, our data platform will be accessible to the full resilience finance community, and our convenings will be designed to serve the field rather than any single funder or institutional interest. We’re committed to this becoming one of the University’s flagship programs.”

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