Europe stands among the most urbanised regions on the globe. Trends in urbanisation are increasingly important for investors. However, not all cities are equal. With the predicted growth of disruptive technology, it is vital to identify locations that will show resilience to change.
The Savills Investment Management Dynamic Cities index incorporates cities’ longer-term upwards growth potential rather than focus on the one- to two-year, shorter-term real estate cycle.
Using 60 indicators across 6 subcategories, Savills Investment Management has identified London, Cambridge, Paris, Amsterdam and Berlin as the top five European cities for real estate investment. These winning cities are enjoying infrastructure investments and well-developed knowledge networks. They are supported by a backdrop of universities and enterprise that are influencing innovation.
The cities boast a global talent pool and have strong cultural amenities. Not only does that retain a workforce, but it also continues to attract highly skilled labour, generating innovation that creates wealth over the longer term.
The Dynamic Cities project allows investors to choose cities where most people want to work, rest and play. That can only be good for long-term real estate investment.
All three property sectors - office, retail and industrial - benefit from these characteristics. Rising employment helps support the office sector. Wealth creation is a positive for growing consumer expenditure, benefitting the variety of retail subsectors. Together with structural change in the form of e-commerce and trends in last mile delivery, the demand for the industrial sector can only be positive.
Source : Savills Investment Management