Aside from a limited weighting to office rents and occupational costs, the study analyses European cities in the context of eight non-property metrics. These span categories such as the supply of ‘Fresh Talent’ being generated by each city’s higher education systems and also ‘Employee Aspirational Factors’ which essentially gauge how pleasant a city is to work in.
Along with other more prosaic measures like ‘Economic Output’ and ‘Workforce Catchment’, the report analyses a total of more than 150 data metrics which enables a ranking of Europe’s great cities. While the overall scores tend to favour the cities with larger catchments, the analysis examines different aspects of each city in proportional terms to provide fair coverage to both big and small – and some locations certainly punch above their weight.
With Brexit uncertainty placing a question mark next to the attractiveness of the UK to globalised businesses, it’s comforting to see that London ranks at No.1 in the analysis.
Digging deeper into the findings, it is also interesting to see that – with Europe facing an imminent capacity constraint in terms of very low unemployment levels combined with shrinking working populations - London also leads in the Latent/Future Talent category. In short, it’s best positioned to offer occupiers the best options in terms of latent and future talent to help drive their growth needs.
London is followed closely at the top of the rankings by Paris. The top ten also features a mix of large to small including Madrid, Munich and Moscow. Southern European cities including Madrid, Barcelona, Milan and Rome score strongly courtesy of high youth unemployment which is driving strong latent talent pools. The big question for these cities is whether they can create the right jobs to hang on to this talent, and stem the exodus of workers leaving in search of better employment opportunities across Europe.
The question is: does this combination of largely non-property metrics now influence the flow of investment into property? Well, if the top three ranking cities are anything to go by the answer is ‘yes’. London, Paris and Madrid were also the top three investment destinations in 2017.
There seems to be a clear correlation that investors are buying into cities which not only have some of the best property in the world but also have the best current - and potentially long-term - drivers to capture and retain the talent that can help drive business growth.
Director | Head of EMEA Research