A survey by Jones Lang LaSalle identifies the world’s best urban real estate performers — and their findings might surprise you. According to the Chicago-based firm, the three cities that stood out over the past decade are Dubai (United Arab Emirates), Dublin (Ireland) and Las Vegas (U.S), all for "superior" performance.
Dubai came in first as the urban leader in employment and population growth; Dublin scored well consistently in terms of its economic growth and overall real estate activity; Las Vegas rounded out the trio for being "head and shoulders" above other North American cities in nearly every category.
All of these cities have fewer than 2 million people, light regulation and a strong record of attracting skilled and educated workers. Both Las Vegas and Dubai are strong in leisure activities, while Dublin has become a key European short-stay destination.
"Our search for the essence of competitiveness is taking us away from the traditional city with its steady, reasonably predictable markets, to the fast, vibrant, technology-rich city of the future where urbanization and information go hand in hand to create new city forms and functions," says Jacques Gordon, LaSalle’s international director of research.
A second phase of the study, yet to be conducted, will identify the new metrics and predictors of success that are key to unlocking future real estate performance, and a third stage — to be finished next spring — will predict the rising urban stars.
According to Gordon, the top 10 world cities in terms of resident top company volume and high-level services are New York, London, Paris, Tokyo, Chicago, Los Angeles, Frankfurt, Milan, Hong Kong and Singapore.
However, Jones Lang LaSalle cautions investors not to seek out cities strictly on the basis of rapid growth projection. "Of the cities that expanded fastest physically, only Dublin produced strong rental growth. One of the objectives of the next stage of the project is to identify cities that are evolving from ‘developing’ to ‘developed’ status and so are more likely to generate sustained investment performance," says William Maher, investment management’s director of North American research and strategy.