How to understand "based'in this sentence? Is it a adjection or noun?
Traditionally, many industries and companies set up business headquarters in the city but as time has changed the need to be city based has diminished.

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city-based here is compound, you can see it as adjective

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you are right but city have all types of resources

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you are right but city have all types of resources

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you are right but city have all types of resources

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In this case, 'based' means 'located'. Here is another way to say the sentence:
Traditionally, many industries and companies set up business headquarters in the city, but as time has changed the need to be located in the city has diminished.

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