Giving citizens a voice in urban development processes is crucial for enabling socially sustainable cities and communities. However, citizens’ opportunities to express ideas are often limited to communication channels that offer poor incentives for participation. In this paper, we conducted an in-the-wild technology probe study (N=16) using a generative AI (GenAI) tool to allow citizens to visualise and submit urban development ideas by taking pictures and manipulating them with GenAI. The results highlight the potential of GenAI to empower, engage, and inspire citizens‘ creativity. We then conducted additional expert interviews (N=6) with city representatives and community associates. They voiced GenAI’s value in early-stage citizen participation but raised concerns about excluding senior citizens. Building on these insights, we present the design and evaluation (N=10) of UrbAI, a co-creative system tailored to urban development participation and conclude with lessons learned to inform how GenAI could be embedded in future citizen participation processes.