INSIGHTS
World Cities Review
MARCH 2013
NEW
HORIZONS
The key destinations for
global real estate wealth
world cities
contents
02-03
04-05
06
07-09
10-11
12-13
14
15
wElCOM E
THE bRIEfIN g
OffICES
RESIdENTIAl
11.3%
bIllIONAIRES
Sp OTlIg HT
AT A gl ANCE
CONTACTS
key
percentage of world
billionaires
0.0%
22.2
228
EuROpE &
SCANdINAvIA
450
NORTH
AMERICAS
3.3%
00
66
number of actual
billionaires
SOuRCE: fORbES
CENTRAl
& SOuTH
AMERICA
New geographies of wealth creation have caused a
worldwide change in demand for real estate. New
nationalities are now seeking to buy in Asian cities,
as well as the old world, meaning the last fve years
have seen a signifcant shift in real estate markets.
2008 was a turning point in the investment
behaviour of the worlds ultra-wealthy citizens. Te
search for safe stores of wealth took money out of
equities into gold, bonds and real estate, including
the worlds most lite houses. It also marked a shift in
the creation of wealth. As indebted North Atlantic
countries commenced a long process of austerity,
there was little or no increase in the numbers of ultra
wealthy individuals there. But, in the relatively
unafected and fast-growing new world economies,
new billionaires were created with some velocity.
Since 2008, falling currencies have made real
estate look even cheaper for a number of nations, so
certain old world cities began to behave more like
their new world counterparts. As a result, the past
four years have seen a huge appetite for ultra-prime
residential property in the worlds premier cities.
Inevitably, this increased activity by wealthy buyers
has caused signifcant price rises in many locations.
- 02 savills.com
world cities
5.3%
108
cis
46.5%
943
china &
hong kong
2.4
2.6%
52
48
indian
sub-continent
middle east
& africa
6.5
131
asia pacific &
australasia
It is possible that 2013 may be another turning
point. Many of the super-wealthy have nearly fully
invested in the key cities, meaning that activity could
abate in some quarters and shift to new locations.
We have detected a stabilisation in many of the
world city markets, sometimes assisted by deliberate
cooling policies. Tere has also been a shift in Asia
Pacifc buyer interest toward the USA, for example,
which currently looks good value. New investment
may be less dominated by China, India and
Singapore, as emerging nations such as Malaysia,
Indonesia and the Philippines play an increasing role.
Watch
our exclusive
World cities
video report at
WWW.savills.com/
Worldcities
- 03 savills.com
the briefing
counting the costs
the true costs of global commercial and residential real
estate are an increasing consideration for many industries
eal estate is just one of the many
costs associated with setting up,
expanding or relocating global
businesses. While it is unlikely ever to
be the sole motivating or deciding factor
in the choice of a city, it is increasingly
signifcant for a number of industries, but
in a way not seen before.
Staf have become the single most
important asset for many organisations in
all parts of the world, particularly in the
service sector. Consequently, the quality of
the environment in which employees work
and live has become a key success factor for
those industries. In the intensely
SavillS ExEcutivE unit
(SEu) conSiStS of...
Middle
Aged
ex-PAt Ceo
Senior
ex-PAt
direCtor
loCAlly
eMPloyed
direCtor
loCAlly eMPloyed AdMin StAff
competitive global market for top talent,
the cost, quality and desirability of a city
lifestyle is an important unit of currency.
making a comparison
We have looked at the relative
competitiveness of our 10 world cities, not
only on the basis of the annual rental costs
associated with ofce and residential
accommodation, but also the additional
costs like service charges, local taxes and
other items that might be associated with
such tenancies. We have looked at this for
two diferent types of employer, using our
Savills Executive Unit as a unit of
comparison in each case (see above).
total rEal EStatE
occupancy coStS
at dEcEmbEr 2012
for onE financial &
onE crEativE company
As usual, Hong Kong ranks number
one in total annual real estate costs (see
left), roughly three times the cost of
locating in Mumbai or Shanghai. Te big
surprise is the position of New York as the
third most expensive city by this measure.
While headline residential capital values
look cheap by international standards, rents
have grown fast and the taxes and other
costs associated with occupancy are high.
a measure of success
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- 04 savills.com
(uS$1
Te total costs measure reveals that most
of the new world is relatively cheap, with
Sydney standing out as a particularly good
value old world city, well-placed to attract
expanding companies in the Pacifc region.
Tis is perhaps why it has shown strong
growth in total costs since 2008, backed by
a strong demand, in turn buoyed by a
strong local economy and advantageous
regional positioning, as well as all the
safety, stability and transparency of an
established market. We may well see
Sydney becoming an increasingly global
city as it proves attractive to new and
expanding businesses on the Pacifc Rim.
Te main obstacle to this is the citys
restrictions on foreign purchasers buying
homes. Some choices of business location
have as much to do with where the CEO
wants to live as economic considerations.
Diferent types of company have
diferent requirements, so we have also
compared the costs for both a fnancial and
creative SEU company to live and work in
each city (see above), with difering and
sometimes surprising results.
variable growth
Overall, the growth in total costs since
2008 has been variable. Premises for
creative businesses in Mumbai and New
York are over 20% more expensive now,
having grown lower bases on the back of
strong economies, while Singapore and
Tokyo are up to 20% cheaper. Total real
the briefing
Some choices of business location have
as much to do with where the CEO wants
to live as economic considerations
yolande barnes, savills world research
total cost change since 2008
financial sector creative industry
-20%
-15%
-10%
-5%
0%
0%
5%
hong kong
-11%
mumbai
8%
1%
0%
22%
14%
new york
paris
3%
11%
-15%
16%
singapore
-4%
14%
14%
sydney
-20%
21%
6%
shanghai
-18%
20%
moscow
-6%
-19%
15%
7%
4%
london
10%
-14%
tokyo
-10%
-5%
estate costs in most countries have stayed
roughly similar since the North Atlantic
debt crisis struck, although the costs of
fnancial company premises have cheapened
more suggesting demand has increased
further among new creative industries.
Te relative cost freeze in rents and
associated costs is changed by currency
0%
0%
fuctuations (not shown), which have
served to make some cities, such as Sydney,
look more expensive to euro and sterling
denominated businesses. Although
competitive and static real-estate costs
might be expected in recession-hit old
world cities, it is perhaps surprising in view
of the high levels of capital growth seen in
- 05 savills.com
5%
10%
15%
20%
new world cities. Generally, we see this as
indicative of the more elastic supply-side
response in these locations, which have
suppressed rental growth, despite an infux
of investor equity. It also refects the extent
of the yield contraction in many new
world cities, where rents have not kept
pace with capital values.
offices
the price of success
extra costs can add significantly
to office accommodation overheads
here can be signifcant diferences
between the headline rent on
commercial premises and the total
costs that tenants end up paying. In New
York, for example, although the basic rent
for an executive unit operating in a creative
industry is the ffth most expensive in the
world, on a per sq ft basis, this rises to the
second when whole space and associated
costs like local taxes, letting costs and
service charges are considered. Tese extra
costs add 53% to the headline rent.
London is another city where headline
rents per sq ft are very high and additional
costs can signifcantly add to real-estate
overheads. Tese conspire to make
Londons whole space costs the second
most expensive of the 10 cities for a small
fnancial company, such as a hedge fund,
locating in the most prime district of
Mayfair. However, London ofers a much
wider range of rental levels than some of
our world cities and therefore is among the
cheapest cities for a small creative company
start-up. Paris, on the other hand, looks very
cheap for the fnancial unit, ranking third
cheapest of the 10. However, it has a much
smaller range of rent levels across diferent
geographies meaning that it is the third
most expensive for the creative company.
As seems to be usual now in all our
global real estate rankings, Hong Kong
ranks as the number one most expensive
city for both types of company, by a
big margin, for a whole ofce (as opposed
to per sq ft). Hong Kongs ofces are
particularly expensive for small companies
in the prestigious central fnancial district
and total costs here are two and a half
times the average for the other 10 cities
and nearly twice that of its nearest rivals.
Tis is despite Hong Kong having the
lowest additional, hidden costs of any city.
Of the 10 global cities, Sydney, Shanghai
and Mumbai have the lowest associated real
estate costs, while London, New York,
Moscow and Singapore have the highest.
commercial real estate and associated
costs for different seU types in dec 2012
financial company rent psft financial company costs psft
creative company rent psft creative company costs psft
total cost of office
space ranking
rents and costs
by per sq ft
50
100
150
% costs over
headline rent
hong kong
1
1
london
2
6
moscow
3
10
new york
4
2
tokyo
5
5
shanghai
6
9
singapore
7
7
54 12
37 9
22%
25%
paris
8
3
36 7
37 8
19%
20%
mUmbai
9
8
sydney
10
4
113 15
40 8
31
108
14
31 11
20
52
35
77
18
48 2
25 2
26 1
15 1
40 0
27 0
- 06 savills.com
63 6
13%
20%
51 47%
44%
39%
35%
26
34%
53%
100 5
5%
5%
9%
9%
2%
5%
0%
0%
residential
strong prospects
HealtHy demand in all our world cities
equates to solid rental returns
ental growth is a good indicator of
the underlying demand for homes.
Te interaction of demand and
supply is readily apparent in rental growth
without the noise created by purchasers
with motives other than occupation.
Overall, demand for accommodation in
all our world cities is healthy. Te rents
paid by the seven households in our Savills
Executive Unit (SEU) rose by 5.1% on
average across all cities. However, there was
large variation around this average.
Te biggest growth was in Mumbai
where the opening of new transport links
has changed the nature of a whole sector of
the city, north at Andheri. Te new metro
link will increase connectivity and decrease
travel times to the centre from two hours
to 20 minutes raising real estate prices in
that area signifcantly. Te priming of the
neighbourhood has already led to a rise in
rental values of up to 50% in 2012 alone
for certain types of property and is
expected to increase further. Tis illustrates
the dynamic and evolving nature of many
global cities and the dramatic impact that
signifcant infrastructure improvements
can have, especially in emerging economies.
Investors looking for signifcant value
uplift will try to anticipate such changes in
any of our world cities and speculate on
their impact. Indeed, it would seem that
infrastructure improvements in Mumbai
had already been priced into capital values
tenants respond much later than investors.
For those looking for solid returns and
rental growth, our world cities have
performed well, especially in the
mainstream markets that serve the
administrative staf of our executive unit.
Any more recent, weaker rental growth
seems to have been concentrated in the
prime sectors of the cities, where the CEO
and directors are more likely to live. In
Hong Kong, for example, the mainstream
market grew strongly in 2012 while prime
rental markets fell. Generally, the top end
properties of Hong Kong, Paris, Singapore
and Tokyo have been weak, perhaps
refecting falls in the relative level of
corporate activity in these cities.
Prospects for rental growth are strong
where the outlook for economic growth is
positive, as this naturally leads to people
seeking employment and accommodation
in the city in question.
Growth prospects are also further
strengthened where there is a limited
supply of new or available housing. Rental
growth in old world cities is more likely
to be driven by such a lack of supply.
Meanwhile, those new world cities with
the space and infrastructure to expand, like
Shanghai, will see weaker growth than
those that are more land-constrained, such
as Mumbai and Singapore.
2012 residential rental growth for our world cities
mumbai
ceo
directors
admin
staff
total saVills
eXecutiVe
unit
14.3%
41.7%
8.6%
18.9%
moscow
12.9%
11.9%
6.2%
8.8%
london
-0.3%
3.8%
6.3%
4.7%
new york
8.0%
6.3%
2.7%
4.6%
sydney
3.8%
3.5%
4.6%
4.2%
shanghai hong kong
7.1%
5.3%
2.9%
4.0%
- 07 savills.com
-3.6%
-8.3%
12.6%
3.0%
paris
0.0%
0.0%
0.0%
0.0%
singapore
tokyo
-9.2%
-2.2%
2.0%
0.5%
-0.1%
-5.2%
-0.1%
-2.0%
all cities
3.6%
7.0%
4.5%
5.1%
residential
Paying dividends
global ProPerty investors are turning their
attention to income-generating residential assets
s global wealth has been pouring
into real assets, including world
real estate, since 2008, so the
motives for real estate acquisition have
shifted. while investors used to be
primarily seeking safe haven assets in
which to store wealth, we now detect an
increasing interest by global investors in
income-producing assets.
Tis shift means that the fundamentals
of rental growth and yield are becoming
more important to buyers whose search
is moving down-market, away from
prime and trophy properties to mainstream
markets, from commercial to residential
and away from the city core to fringe.
in demand
while rental demand and growth show
that the fundamentals of demand and
supply are reasonably strong in most of
the cities studied, there are considerable
The fundamentals
of rental growth
and yield are
becoming more
important
to buyers
variations in yields. Tese disparities arise
due to the quirks and diferences between
capital value and rental markets, as well
as investor sentiment. Understanding
these anomalies will assist buyers who
are looking to make diferent types of
investment play.
Variations in yield tend to occur because
of diferences between owner and tenant
behaviour. owner-occupiers tend to
value diferent property features to those
considered desirable by tenants and, at the
same time, investors are more active in
some markets than others. Tere are also
ways in which investors favour some
markets over others. For example, foreign
investors are focusing on prime rather
than mainstream London, and singapore
over shanghai.
variable yields
across all our world cities, yields are
more variable now than they were seven
years ago. Back in 2005, most cities, in
the old world and new world, were
showing an annual gross rental return of
around 5.5%. Tere is now a huge range
of returns, from 2.4% to 6.4%.
yields have moved dramatically in many
new world cities because rental growth
has not kept pace with very high levels of
DECEMBER 2012 REsiDEntial yiElDs (gRoss)
1
5=
new york
moscow
London
sydney
Paris
6.4 5.6 5.2 4.9 4.8
%
- 08 savills.com
RESIDENTIAL
We now detect an increasing interest by
global investors in income-producing assets
PAUL TOSTEVIN, SAVILLS WORLD RESEARCH
A WORLD OF CHOICE
capital growth, caused by the weight of
money bearing down on Chinese and
Indian markets in particular.
WORLD CITY YIELD SPREAD
ALL OLD WORLD NEW WORLD
HIGHER INCOME
7.0%
6.0%
5.0%
INDEX: GROSS YIELD
While falling interest rates in the East and
West have caused some yield contraction
in the old world, this has not been nearly
so dramatic. Te higher income returns
available can be seen as compensating for
the much lower rates of old world capital
growth. In North American cities, where
the prospects for capital growth may be
seen as increasing, the combination of
these yields, ongoing rental growth and
low capital values are considered by many
overseas investors to be a strong buy signal.
Any investors nervously regarding future
capital growth in Asian markets may start
to view low yields as a sell or hold signal,
at least until or unless rental values start
closing the gap.
4.0%
3.0%
2.0%
1.0%
0%
DEC
05
DEC
06
DEC
07
DEC
08
DEC
09
DEC
10
DEC
11
DEC
12
5=
10
TOKYO
SINGAPORE
MUMBAI
HONG KONG
SHANGHAI
4.8 4.1 3.6 2.8 2.4
%
- 09 SAVILLS.COM
billionaires
r ich pickings
the valUe of Ultra-prime homes in key areas
has DoUBleD thanks to Billionaire BUyers
lobal billionaire activity in world
real estate markets has been so
intense over the past seven years
that it has led to a doubling of residential
property values in this sector.
Although overall, aggregated world
values fell after 2007 and price movements
seem volatile, recovery has been signifcant
since 2009. As a result, billionaire markets
have exceeded the growth seen in the
mainstream markets of the same cities.
Driving growth
Te activity of billionaires in international
real estate markets refects the creation of
global wealth and the economic success
of particular regions and cities. Tis means
that the cities in newly emerged economies
have signifcantly outperformed those in
the old world economies of the US,
Japan, Australia and Europe.
Only Londons ultra-prime market
stands out among the old world cities
as having shown signifcant growth
since 2005, totalling 107%. New Yorks
billionaire real estate stands only 47%
higher and Tokyo ultra-prime residential
is only 8% more expensive (in local
currency) than it was in 2005.
Rising commodity prices and the
creation of new, ultra-rich classes in China
and Asia have precipitated the highest
growth in ultra-prime real estate values.
Singapore and Mumbai stand out as having
seen the highest growth in ultra-prime
values since 2005 (at 232% and 176%
respectively). Both grew from relatively low
base values. Te highest overall values are
Billionaire markets
have exceeded the
growth seen in
mainstream markets
seen in Hong Kong. Te record deal there
was 8,200 (US$13,100) per square foot for
a house in Deep Water Bay Road in 2011.
Billionaire Boltholes
Billionaire activity has been concentrated
on high-end urban centres rather than
leisure properties in the surrounding
countryside or regional sunbelts.
Consequently, the index for billionaire
leisure homes has not yet quite recovered
to its former 2007 peak and only stands
34% higher than it did in June 2005.
Ultra-prime is staBilising
2012 saw signifcant curbs imposed on
billionaire buyers in some cities. Tis has
resulted in slowdowns rather than falls in
most of them. Singapores ultra-prime
growth slowed to about 5% in the year,
while Hong Kongs stalled and Londons
also slowed signifcantly, both in the second
half of 2012. Moscow prices slowed
alongside commodity prices, which are
closely linked to the value of Russian
ultra-wealthy individuals.
In France threatened tax measures
seemed directly to have curbed activity.
Our ultra-prime index in Paris is down,
nearly -8% on the year, while billionaire
Riviera properties ended down -10%.
Overall, the ultra-prime billionaire
markets are stable. Real estate, especially
in old world countries, is seen as a safe
store of wealth. Te US, in particular, looks
ripe for growth.
Ultimately, the worlds richest
inhabitants will continue to set up homes
in the most cosmopolitan and wealthiest
cities, which ofer commercial advantages
and quality of life. Leisure resorts and
country property purchases tend to lag
behind city values, but they have the
potential for recovery. Leisure properties in
the most fashionable billionaire boltholes
and prosperous world regions are likely to
see the highest growth.
- 10 savills.com
record deals
around the world
the highest prices
achieveD in each of
the 10 gloBal cities
(At Dec 2012 exchange rates)
london
kensington palace
gardens, 2008
8,500
psft
(us$13,700)
honG KonG
8,200
deep water bay road, 2011
psft
(us$13,100)
new yorK
8,100
15 central park west, 2011
psft
(us$13,000)
BILLIONAIRES
Cities in newly emerged economies have significantly
outperformed those in the old world economies
YOLANDE BARNES, SAVILLS WORLD RESEARCH
A WORLD APART
BILLIONAIRE HOUSE PRICE GROWTH OLD WORLD v NEW WORLD
TOKYO
NEW WORLD CITY BILLIONAIRE HOMES
OLD WORLD CITY BILLIONAIRE HOMES
4,700
roppongi hills, 2007
PSFT
NEW WORLD BILLIONAIRE LEISURE HOMES
OLD WORLD BILLIONAIRE LEISURE HOMES
300
(US$7,600)
250
200
INDEX: 2005=100
PARIS
3,900
quai anatole france, 2009
PSFT
SINGAPORE
the marq on
paterson hill, 2011
DEC
05
3,500
DEC
06
DEC
07
DEC
08
DEC
09
DEC
10
DEC
11
DEC
12
PSFT
MOSCOW
crystal house, 2011
2,300
(US$5,600)
HOME AND AWAY
PSFT
(US$3,800)
BILLIONAIRE CITY v LEISURE PROPERTY PRICE GROWTH
BILLIONAIRE WORLD LEISURE HOMES
BILLIONAIRE WORLD CITY HOMES
NON-BILLIONAIRE WORLD CITY HOMES
8=
SHANGHAI
300
1,700
tomson riviera, 2010
PSFT
250
(US$2,800)
200
SYDNEY
wolseley road,
point piper, 2011
1,700
PSFT
10
MUMBAI
INDEX: 2005=100
8=
(US$2,800)
100
50
(US$6,300)
150
150
100
tahnee heights, 2012
50
(US$2,200)
1,300
PSFT
DEC
05
DEC
06
- 11 SAVILLS.COM
DEC
07
DEC
08
DEC
09
DEC
10
DEC
11
DEC
12
CITY SPOTLIGHT
TOKYO
JAPANS UNUSUAL RESIDENTIAL MARKET
MEANS FALLING YIELDS ARE DECEPTIVE
okyo saw modest rental growth in
the run-up to 2008, followed by
steady falls ever since. Capital
values were much more volatile, booming
further than rents and falling more.
As a result of the capital market volatility
and decline in rents, there has been a
signicant downward yield shift in the
SEU properties from 6.8% in 2005 to
4.8% now. While this may seem bizarre in
a weakening market, it realigns Tokyo with
world city norms and also makes sense in
the context of very low bond rates at home.
Tokyo is one of the least global of the
cities in this study. Recently, the strength
of the yen has been a major barrier to
un-hedged overseas buyers who have feared
losing value in adverse exchange rate
movements. Yen-denominated assets also
look expensive compared to other cities.
Te current average value for the Savills
executive unit is 51% higher in sterling
terms than it would have been if sterling/
yen exchange rates had remained at their
December 2005 levels.
Another peculiarity of the Tokyo market
is the way that real estate is valued in Japan.
A QUESTION OF VALUE
TOKYO RENTAL VALUE INDEX
TOKYO CAPITAL VALUE INDEX
105
100
95
90
85
80
75
70
65
60
DEC
05
DEC
06
DEC
07
DEC
08
DEC
09
DEC
10
DEC
11
DEC
12
SOFT RETURN
TOKYO AVERAGE YIELD FOR SEU
8.0%
7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
DEC
05
DEC
06
DEC
07
DEC
08
DEC
09
- 12 SAVILLS.COM
DEC
10
DEC
11
DEC
12
Te bulk of a propertys value is in the land
it stands on and, while this may also be true
in other countries, it is often not recognised
in appraisal methods, which combine the
buildings and land in a single entity.
In Japan, the building itself is considered
separately from the land, so the building
value depreciates. Tis depreciation occurs
over a relatively short period because the
tradition is to rebuild every 30 years or so.
Tis is a logical way to proceed in an
earthquake-prone city where the only
lasting variable in the real estate equation
may be land. But it makes it dicult to
make a comparison with Western markets.
Rental growth can be more revealing of
underlying demand, but even here there
tends to be a deationary eect due to a
cultural preference for new properties.
Tis means the natural tendency of
Japanese house prices, as a whole, is to
decline. A Japanese index, measured by
conventional means, will appear to be falling
due to this depreciation. Tis could mislead
any investor willing to take a residential
development value at the end of 25-30
years, as in most commercial property.
CITY SPOTLIGHT
NEW YORK
THE BIG APPLES HEALTHY RESIDENTIAL
RETURNS ARE ATTRACTING INVESTORS
ew York stands out among other
American cities because, although
values there fell signicantly after
2007, it did not see quite the same level of
extreme falls as some others. New Yorks
recovery has also been rapid. Te last year
has seen high levels of growth in the
properties that make up the Savills World
Cities Index. Overall growth was 12% and
the value of residential properties occupied
by the seven SEU households is now back
at its 2007 level.
New York stands out among world cities
as looking particularly good value,
especially from an income return point of
view. As residential prices have seen much
lower growth than other World Cities,
New York has fallen in rank from one of
the most expensive to a distinctly cheap
old world urban centre. Current values
are only 23% above their 2005 levels and
the average rental yield on properties
occupied by the seven households in the
Savills Executive Unit is 6.4% gross.
At the same time, the relative weakness
of the dollar against many Asian currencies
naturally encourages trans-continental
CHANGE IN WORLD CITY
RANKINGS SINCE 2005
RANK
2012
INDEX
2005
RANK
INDEX
HONG KONG
237.4
173.7
LONDON
130.1
131.4
SINGAPORE
112.8
82.8
TOKYO
101.5
149.9
PARIS
93.3
110.3
SHANGHAI
76.2
54.6
NEW YORK
72.7
114.9
MOSCOW
67.7
48.9
SYDNEY
64.0
103.2
MUMBAI
10
44.6
10
30.3
10 CITIES AVERAGE=100
- 13 SAVILLS.COM
investment ows. Terefore the strong
interest from Asia for real estate in
North American cities is of little surprise.
Tere are, however, some possible
impediments to investment in New York.
Tese fall into two main categories:
associated costs and housing tenure types.
Te entry, holding and exit costs associated
with property are relatively high and the
prevalence of the co-operative tenure for
apartments means foreigners may nd it
more dicult to buy. Tey are relatively
restricted to the 30% of stock that is
condominium tenure. Were it not for these
peculiarities New York would be an
extremely strong starting point for North
American recovery investment.
On the face of it, New York looks a
good investment for those seeking good
medium-term capital growth prospects and
healthy returns. For many Asian buyers,
there is also the advantage of a weak dollar.
It is hardly surprising that the number of
overseas buyers is increasing. What makes
the city a continuingly attractive deal
is the steady rental growth since 2009,
indicating healthy underlying demand.
AT A GLANCE
ALL IN THE DETA ILS
A SNAPSHOT OF THE SEU IN WORLD CITY ANNUAL MARKETS IN 2012
TOTAL COST RANK OFFICE AND RESIDENTIAL RENTAL VALUE GROWTH
RESIDENTIAL CAPITAL VALUE GROWTH
NEW YORK
office rental
value growth:
9.0%
4.6%
12.2%
residential rental
value growth:
residential capital
value growth:
10
MOSCOW
MUMBAI
office rental
value growth:
office rental
value growth:
residential rental
value growth:
residential rental
value growth:
13.9%
8.8%
9.0%
residential capital
value growth:
-9.7%
18.9%
0.7%
residential capital
value growth:
SHANGHAI
office rental
value growth:
4.3%
4.0%
-0.5%
residential rental
value growth:
residential capital
value growth:
LONDON
TOKYO
office rental
value growth:
office rental
value growth:
residential rental
value growth:
residential rental
value growth:
residential capital
value growth:
residential capital
value growth:
6.5%
4.7%
2.7%
7.0%
-2.0%
-0.7%
PARIS
office rental
value growth:
5.0%
0.0%
-3.4%
residential rental
value growth:
residential capital
value growth:
SINGAPORE
SYDNEY
office rental
value growth:
office rental
value growth:
residential rental
value growth:
residential rental
value growth:
residential capital
value growth:
residential capital
value growth:
-8.5%
9.1%
3.5%
- 14 SAVILLS.COM
2.8%
4.2%
4.2%
HONG KONG
office rental
value growth:
-3.7%
3.0%
15.2%
residential rental
value growth:
residential capital
value growth:
contacts
expert commentary
illustrations: adam pointer. images: corbis, getty images, shutterstock
savills agents are at the heart of
the global property market
Hong kong
London
moscow
mumbai
new york
raymond Lee
savills Hong kong
+852 2842 4518
[email protected]
Jonathan Hewlett
savills London
+44 (0) 20 7824 9018
[email protected]
alexander shatalov
intermark savills
+7 (495) 775 22 40
a.shatalov@
intermarksavills.ru
alan bell
savills indian associate
+91 9900 234 348
[email protected]
elizabeth stribling
stribling associates
+1 212 452 4400
[email protected]
a high-growth city
that continues to
attract investment,
especially from
mainland china.
europes fastest
growing city,
london appeals to
investors as well as
safe-haven buyers.
moscow has
a domestic market
with strong growth
fuelled by
commodity prices.
economic
development and
population growth
plus limited supply
are driving values.
one of north
americas mostrecovered cities, we
expect to see further
value growth.
Paris
sHangHai
singaPore
sydney
tokyo
Jean claude caputo
savills riviera estates
+33 (0) 493 874 115
[email protected]albert Lau
savills shanghai
+(8621) 6391 6688
[email protected]
christopher marriott
savills singapore
+65 6415 3888
[email protected]
shayne Harris
savills sydney
+61 (0) 2 8215 8879
[email protected]
chris mancini
savills tokyo
+81 (0) 3 5562 1700
[email protected]
tax policies have
dealt a blow to prime
domestic demand.
values are weak and
may soften further.
in 2013, shanghai
will be boosted by
renewed wealth
creation and relaxed
cooling measures.
a strong and
high-yielding city,
despite raised taxes
and restrictions
for foreigners.
sydney remains
good value by old
world standards and
is attractive to pacificrim investors.
tokyos deep
occupier markets
offer investors
stable income
returns.
research contacts
yolande barnes
+44 (0) 20 7409 8899
[email protected]
simon smith
+852 2842 4573
[email protected]
Paul tostevin
+44 (0) 20 7016 3883
[email protected]
eri mitsostergiou
+31 (0) 20 301 2087
e.mitsostergiou@
savills.nl
Insights is published on behalf of Savills PLC by Seven, seven.co.uk. All information correct at time of going to press. All rights reserved.
Articles may not be reproduced without written permission from Savills PLC. While every care is taken in compiling the content, neither the
publisher nor Savills PLC Ltd assumes responsibility for efects arising from this publication. Property Misdescriptions Act: Savills recommends
applicants discuss their interest in a property with the negotiator who can answer your specifc questions and advise if it is under ofer.
Tis is important if you are contemplating travelling some distance. All descriptions, dimensions, references to condition and permissions for use
and occupation, and other details are given without responsibility, and any intending purchasers or tenants should not rely on them as statements of
fact, but must satisfy themselves by inspection of the property. Investment advice: Te information and opinions contained in this magazine do not
constitute professional advice and should not be relied upon. Specifc advice relating to your individual circumstances should be obtained.
- 15 savills.com
