Savills Resilient Cities Index, launched as part of its Impacts research programme, identified the ‘challenger cities’ where the international real estate advisor examines which cities will be able to withstand or embrace the technological, demographic and leadership disruption facing global real estate today and in 10 years’ time.
While the ranking finds that New York, Tokyo, London and Los Angeles are the top four most resilient cities today, and are expected to remain so in 2028, Savills highlights ‘challenger cities’ that will enter the top 50 and make the biggest leaps up the ranking over the next decade.
These ‘challenger cities’ are poised to compete with established cities by using disruption to their advantage, as they are often able to respond faster and more flexibly to swift changes in technology and society, says Savills, and are therefore ones to watch by real estate investors ready to take a long-term view.
“Challenger cities are all likely to see substantial increases in their GDP and growth in household incomes, while their dependency ratios – the proportion of people of a non-working age to those of a working age – will either fall or increase at a lower rate than other major cities between now and 2028. This indicates that they are set to be young, prosperous and able to adapt to changes in the way the world operates at a faster pace than some better known locations,” says Ben Maudling, CEO of Savills Czech and Slovak Republics.
The list of the world’s top global cities may feel like it’s almost set in stone, but their real estate assets have become correspondingly expensive and highly sought after. As such, the ‘challenger cities’ could offer alternative investment destinations. While not without risk, these cities are set to accelerate up the ranks as they demonstrate their resilience to the challenges ahead and investors should start investigating how to secure a footing in these markets if they’re willing to sit tight and take a longer-term view.
Savills Resilient Cities Index is a measure of city wealth (GDP), personal wealth (households with an income greater than $70,000), and demographics (population dependency ratio).
- Resilient Cities: These cities have been in the top 20 for at least the last decade and are forecast to remain so over the next 10 years. They are well-placed to withstand or embrace the many disruptive forces facing global real estate today and in the future.
- Emerging Resilient Cities: The new entrants to the top 20, either in the past decade or forecast to be so in the next. Although, they’re not currently as well-established on a global stage, we expect them to match the status of the Resilient Cities by 2028 as they continue their dramatic rise in economic and wealth terms.
- Challenger Cities: Cities that are forecast to make the top 50 by 2028 by jumping at least 10 places. They are poised to rise and challenge the established cities by using disruption to their advantage. For real estate investors with a long-term view, these are the cities to watch.
Impacts is Savills global thought leadership publication and research programme. This year is the ‘disruption issue’, looking at how widespread economic, political, demographic and technological upheaval is changing the world of real estate. How is the rise in populist politics affecting cross-border investment? Which cities are the most resilient to change in the coming decades? How is technology driving the repurposing of retail assets and the rise of new leisure concepts? Where will our food come from? And what are the forces disrupting the world’s prime residential markets? Impacts answers these questions and more.