London has been named the most attractive European city for real estate investment by LaSalle Investment Management, one of the world’s top global real estate investment managers.
LaSalle said in its 12th annual European Regional Economic Growth Index that medium term demand for commercial property will likely be stronger in London than in any other city in Europe.
After it fell from first place in 2008 to eight spot in 2009, the UK capital has now jumped back up, beating last year’s top city, Munich. While the financial crisis seriously affected Europe’s largest financial centre, London’s flexible and dynamic economy has recovered strongly, emphasising its role as the leading business hub and pre-eminent global financial centre of Europe.
Simon Marrison, European CEO of LaSalle Investment Management, said: “There are clear signs of polarisation within many European countries and major disparities between city regions as uncompetitive locations fall behind because they can no longer rely on national momentum for sustained growth. This is most apparent in the UK where London tops the Index but no other city gets into the top 30. As a result, investors should be selective about where they invest as some locations will lead the still fragile economic recovery while others continue to fall behind.”
The E-REGI report still favours wealthy locations like Nordic and Swiss cities, as well as European city regions that enjoy strong fundamentals.
The report named the UK the most polarised Western European economy, with one city at the top of the list and all other cities near or at the bottom half of the ranking. UK regional cities including Belfast, Liverpool and Sheffield have struggled with the transition from industrial hubs to service-based economies and have fallen behind in the 2010 E-REGI.
Germany is recovering from recession, thanks to a weaker euro currency and relative competitiveness, with third-place Munich enjoying strong economic growth prospects. Germany is still the country with the highest number of cities in the top 20, which include Frankfurt, Stuttgart and Mannheim-Karlsruhe.
Other highly ranked cities include Moscow in second spot, Paris occupying fourth place, and Stockholm in the fifth spot. Oslo, Gothenburg, Copenhagen/Oresund, Zurich and Luxemburg also made it to the top 10 most attractive European cities for real estate investment.