Yes. Templates are available for constructing 3D urban landscapes using the 3D Analyst extension at ArcGIS 10 and beyond.
Fundamentally, a city is composed of four components: (1) a detailed cartographic basemap as a primary reference to place and location; (2) high resolution imagery showing actual features on the ground to provide visual realism; (3) detailed terrain information, generated from airborne LIDAR, Digital Elevation Models, or contours; (4) and building models in 3D with attributes relating to their name, address, and type. Additional elements, such as trees and street furniture, can also be included where available.
These features all live in the geodatabase as feature classes, or as cells in raster data sets, and can be shared with others, either locally for editing and maintenance or through the Web for use in project planning and visualization.