I have come to believe that the Ultimate City Bike for most people is a folding bike.
There are many advantages of a folding bike over a standard frame full sized bike.
Storing any bike is an issue in an apartment. With the ability to even just fold the handlebars down you bike can be stored in many entryways without being in the way. Fully folding the bike will allow you to easily store it in the bottom of the closet or behind a chair or any odd unused nook.
It can be really handy to drive your car and park in free parking a couple miles from where you work and ride your bike the rest of the way. Or if you ride your bike to school or work in the morning and it is raining hard when you are ready to leave you can easily put your folded bike into any car, you do not need to use a bike rack on the car or find someone with a pickup to transport your bike.
If you are comparing a good quality folding bike to a good quality city bike you will find performance is very close to the same. You might find a little wider ratios in the gearing on a full size city bike than you do on a good folder but for most people 8-10 gears is plenty.
Small Wheel vs Large Wheel Folders