City managed by thug (7)
I believe the answer is:
rangoon
'city' is the definition.
(Rangoon is an example)
'managed by thug' is the wordplay.
'managed' becomes 'ran' (I've seen this before).
'by' says to put letters next to each other.
'thug' becomes 'goon' (synonyms).
'ran'+'goon'='RANGOON'
(Other definitions for rangoon that I've seen before include "old Asian city" , "Burma's capital" , "Alternative name for Yangon" , "Former name of the capital of Myanmar" , "Port and largest city of Burma" .)