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News Release

London

‘Deep innovation economy’ keeps London at the forefront of dynamic global cities

San Francisco, London, Dubai, Shanghai and Wuhan lead the list of dynamic cities in Jones Lang LaSalle’s City Momentum Index


London , 23 January 2014 — Research released today by Jones Lang LaSalle at the World Economic Forum in Davos examines the impact that urbanization, globalization and technology are having on the economic shape and future potential of cities across the globe.   Recognizing that commercial real estate is no longer just a consequence of a city’s success but a driver of it, Jones Lang LaSalle has identified San Francisco, London, Dubai, Shanghai and Wuhan as being at the forefront of cities that demonstrate the combination of strong short term socio-economic, commercial real estate momentum and longer term foundations for success.


The index, that covers 111 of the globes cities, found that only four  successfully combined strong short-term socio economic momentum with a deeper innovation economy: San Francisco, Austin, New York and London. The UK capital has the highest amount of foreign real estate investment than any other city, standing at over $65 billion dollars over the past three years. The index concludes that the city is riding a ‘wave of optimism’ following the 2012 Olympics and has growing status as a centre for technology and innovation.

Jeremy Kelly, Director in Jones Lang LaSalle's Global Research team commented: “City momentum is about far more than just raw GDP growth.  The true foundation of highly dynamic cities emerges from such factors as speed of innovation and creation of cutting-edge businesses along with new building construction, property price movement and investment in real estate from cross-border investors and corporations. 
 
“The new City Momentum Index offers a fresh and uniquely comprehensive perspective that identifies the signals of change and characteristics of city momentum. By focusing on the features of a city that are likely to underpin future performance, the CMI stands apart from the standard historic performance upon which most indices are based. It is such measures of dynamism in infrastructure, connectivity and innovation that we believe will be steering many investment and location decisions in the future, though investors and corporates should note that high momentum can pose both risk and opportunity.”   
The cities that top the index are characterized by the following dynamics: elite investment cities, which account for one quarter of the world’s direct commercial real estate investment, technology-rich cities, smaller, innovation friendly cities, rapidly urbanising cities in China and growth hotspots.      
 
While Continental European cities are under-represented at the very top of the list and show lower momentum in comparison with emerging cities, several powerful and successful European cities possess the attributes for longer term success as validated by the ongoing high levels of real estate capital inflows.  Demonstrating success factors relating to education, innovation, sustainability and transparency, Paris, Berlin and Amsterdam, for example, are distinguished by their strengths in talent and new technologies, while Copenhagen has among the world’s strongest ‘green’ credentials.
Jeremy Kelly added: “While most indices provide only a static picture of city competitiveness, by taking a unique look at the combination of short-term variables and sustainable long-term characteristics the CMI provides a look into underlying city dynamics, adaptability and real estate market characteristics.”