New research from Aviva Investors suggests that London and Paris will be Europe's most sucessful office markets in the near term, with the two capitals topping its 'Future City' ranking.
Aviva said that its proprietary analysis had revealed the 12 European cities expected to experience the greatest future demand for office space, alongside strong long-term rental growth.
'The role of the city has changed drastically and, whilst location matters no less than it did 50 years ago, being a conduit for knowledge exchange and ideas creation will define a city’s success going forward,' said Chris Urwin, director of research, real assets, at Aviva Investors.
'Cities today need three key characteristics – talent, clusters and scale – to thrive. As a global leader in attracting and nurturing talent, alongside its established clusters of financial and professional services, London is positioned strongly across several key metrics in our analysis,' Urwin added.
'With a city’s prospects defined more than ever by knowledge exchange and information sharing, London and Paris are expected to be the strongest magnets for global talent,' the research said. Relative to peers, 'both cities also benefit from superior scale and their status as international hubs, alongside strong governance credentials', the report added.
Other cities that scored highly overall include Munich, Dublin, Frankfurt, Lyon, Stuttgart and Hamburg. Aviva also used its analysis to identify four tech cities – Copenhagen, Berlin, Amsterdam and Stockholm – which it has earmarked for strategic real estate investment.
'The tech hubs we have identified are cities with world-renowned clusters in digital and biotech. Most importantly, these locations are highly liveable, which attracts talent and businesses,' Urwin noted.
The Future City model created by Aviva Investors uses 30 metrics to assess the credentials of each city; including the ability to attract global talent, cultivate clusters of high value-add economic activities, scale and underlying real estate fundamentals.
