Disagreement over value of German city rankings

MUNICH - Doubts have been cast on the value of a new system which aims to provide investors with a ranking of German cities. The scheme is the brainchild of the German association of public banks (VÖB), which compiled data from around 12,500 municipalities across the country to produce a set of performance indicators for each area.

The results can be accessed online, for a fee, by anyone considering investing in the respective region. But at the Expo Real commercial property trade fair on Tuesday, critics questioned whether the system would be of value to investors.

'There are so many different ratings out there and cities often jump up or drop several places from one year to the next,' said Marc Kleinpeter, Managing Director of Colliers Trombello Köbel Immobilien Consulting in Düsseldorf. 'As such, it's no use investors trying to use them as benchmarks.'

'Also, comparing towns is often like comparing chalk and cheese. Many potential investors already have fixed opinions of places and a ratings system is unlikely to change these opinions,' he said.

Dr Brigitte Wesierski, Director of VÖB, said the new system was based purely on hard facts and did not take subjective soft factors into account. 'We think it will be of great interest to investors,' she said. 'We've looked at it from a purely economical point of view and have come up with performance indicators such as personnel quotas, administration budgets and the investment ratios for fixed assets.'

Norbert Claussen, Lord Mayor of Schwerin, agreed that such systems did have potential.
'These sort of things are doubtless going to become more important,' he said. 'But not the ones which exist at the moment – the quality needs to be improved significantly. What we need to consider is that these things are only as good as the data research that goes into them.'