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EXPO Real: Cities facing both challenges and opportunities

Cities are facing new challenges in the post-pandemic era, delegates heard at Real Asset Media’s Investing in Cities – Outlook & Opportunities briefing, which took place at the International Investors Lounge at EXPO REAL.

Petra Blazkova

“Our research shows that the performance of many cities is declining for the first time since the financial crisis”, said Petra Blazkova, Head of Research & Strategy, Core and Core Plus Capital, LaSalle Investment Management. “We see quite a big challenge ahead, but not for London or Paris which remain dominant. Growth tends to concentrate in a smaller group of cities”.

The pandemic has changed the landscape and altered people’s priorities and demands.

Clare Thomas

“Working from home was very convenient for many, so now cities have to work a little bit harder to attract people back”, said Clare Thomas, Partner, CMS.

“We do see the challenges but we still see very good opportunities across Europe looking at the long term”, said Florian Bauer, Head Real Estate Project Development, Swiss Life Asset Managers. “Given our insurance background, we have a long term horizon and conservative investors focusing on core”.

Florian Bauer

The latest CMS report on the future of cities shows that 85% of global investors still believe that London is the financial capital of the world.

Now there’s an added incentive to invest in the UK capital, said Thomas: “The weakness of the pound makes assets cheaper for international investors, and we are seeing family offices and private equity companies actively looking for opportunities”.

Solly Gubbay

London’s status is unassailable, but Brexit has brought some advantages to other European cities.

“There has been a small transfer of jobs from London to Paris, but the main benefit has been in highlighting Paris as a major office market and a great business hub in Europe”, said Solly Gubbay, Managing Partner, Solly Gubbay Consultants.

Amsterdam’s standing has also increased after the UK left the European Union. “For the first time in 20 years, Amsterdam is in the top 20 in our city index because it has seen a real influx of skilled professionals after Brexit”, said Blazkova.

[Images: Sabine M Mairiedl, Munich (except *)]