Surveys

Silicon Valley, Singapore Most "Future-Proofed" Places - Study

Tom Burroughes, Group Editor, 9 January 2019

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A study looking at how well prepared certain cities/areas are prepared for disruptive technological change, and to handle other forces at work, puts San Francisco, Silicon Valley, London and New York in the top four.

San Francisco and the Silicon Valley area of Northern California rank first and second, respectively, in a global of rating of areas that are most likely to cope with big technology and other changes affecting business and society, while New York and London come in third and fourth place. Singapore ranks 29th out of 30.

The study, by global real estate firm JLL, tracks the cities/areas of the world deemed to be most “future-proofed” to cope with a variety of challenges, including the impact of disruptive technology. Boston, Los Angeles, Paris, Amsterdam, Toronto and San Diego rank behind the top-four in the City Momentum Index for future proofing. Not a single major Asian city is in the top 10, suggesting that this part of the world has progress to make for all the vaunted strides made over recent years. Hong Kong does not even make the top 30.

The rest of the rankings are as follows, in descending order: Chicago, Seattle, Tokyo, Sydney, Munich, Berlin, Melbourne, Austin, Vancouver, Denver, Washington DC, Copenhagen, Stockholm, Edinburgh, Philadelphia, Montreal, Helsinki, Seoul, Singapore and Zurich.

“The cities which top the CMI 2018 Future-Proofing rankings are at the forefront of the innovation economy. By investing and leveraging their strengths in technology, physical and digital connectivity, quality of life and sustainability, they are positioned to maintain their performance into the future in this new competitive landscape,” JLL’s report said.

JLL said northern European cities’ high visibility in the rankings was driven by “high levels of knowledge-intensive employment, physical and digital infrastructure, and sustainability credentials”.

The report’s high scores for San Francisco and Silicon Valley on the “future-proofing” front are unsurprising. The results also suggest that for all the concerns about how the UK leaves the European Union, the country’s capital and financial hub is seen as being in robust shape to cope with change.

In scanning the measures for future-proofing, JLL tested for the following ingredients: Technology firms, transparency, education, environment, infrastructure and international patents.

Short-term momentum
JLL’s rankings of places chalking up the fastest pace of growth show that Asia-Pacific cities are a big draw for global capital, and markets in the region made up 25 of the global top 30. The top city is India’s Hyderabad, followed by Bangalore, Ho Chi Minh City, Pune, Kolkata, Hanoi, Nanjing, Delhi, Hangzhou and Xian. In 30th place is Bucharest.

On the Indian cities featuring in the rankings, JLL said: "While economic energy is propelling India’s cities forward, they also exemplify some of the challenges facing markets with strong momentum, including strains on infrastructure and local amenities; high levels of inequality and affordability issues; and environmental degradation, which can all be compounded by a lack of planning oversight and transparency.”

When short-term momentum and future-proofing scores are blended, Singapore and Seattle deserve particular praise, JLL concluded. 

“Singapore has registered the greatest improvement in short-term momentum of any market over the past year. Rising global trade levels have boosted economic momentum and contributed to an improvement in corporate demand, with net office absorption in 2017 doubling from the previous year. Singapore is projected to record the largest rental growth of any major office market globally in 2018”. It added: “Significant demand from growing tech companies is continuing to boost economic momentum and real estate take-up in Seattle. Supported by growth in its share of US tech market jobs, more than 60 per cent of the office space currently being sought by tenants is required by technology companies, boding well for continued strong performance of the Seattle office sector. Tech tenants’ ongoing need for additional space has placed a premium on centrally-located, creative offices with high-end amenities and transit accessibility and is contributing to among the highest rates of forecast office rental growth globally over the next three years.”

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