Hyderabad among top ranked cities in JLL’s 2018 Global City Momentum Index

Hyderabad, Bengaluru, Pune and Kolkata are among the top five cities in the short-term Momentum Ranking of JLL’s annual global survey. Delhi, Chennai and Mumbai also feature among the top 20 in the Global Top 30 index.

Indian cities dominated the short term momentum ranking in JLL’s recently released annual global report City Momentum Index (CMI) 2018. The report ranked Hyderabad (1^st), Bengaluru (2^nd), Pune (4^th), Kolkata (5^th) and Delhi (8^th) in the top 10 cities out of the 30 top global short-term growth cities. Chennai (14^th) and Mumbai (20^th) completed India’s stellar show on the annual rankings, says the report.

CMI’s Short-Term Momentum rankings identify urban economies and real estate markets which are currently undergoing the most rapid growth and ranks them considering their performance based on various parameters.

Indian cities performed extremely well on key parameters of the population – representing human resource, connectivity, real estate investments, property prices, economic output, corporate activities, construction and retail sales. India maintained its pre-eminence in the Short-Term Momentum rankings as these cities registered among the highest rates of demographic and economic growth globally, while also benefitting from government efforts to boost business attractiveness and invest in infrastructure. With continued strong demand from technology, finance and pharmaceutical companies keeping take-up volumes buoyant and investor activity on an upward path.

City Momentum Index, now in its fifth year, tracks a broad range of factors to identify those cities which possess the attributes for success over the short and long term. The Index covers 131 major established and emerging business hubs across the globe, measuring each city’s short-term socio-economic and commercial real estate momentum, together with its ‘future-proofing’ capacity – the ability to maintain this momentum over the longer term.

While economic energy is propelling India’s cities forward, many of these cities also exemplify the challenges facing markets with strong momentum, including strains on infrastructure and local amenities, high levels of economic disparity and affordability issues and environmental degradation.

In order to maintain their growth over the longer term, these cities will need to focus on future-proofing their markets through improved liveability and affordability, regulatory transparency and physical and technological infrastructure. India has set the pace for making its environment business and investment friendly and most cities have robust plans for accelerated growth in social and physical infrastructure which when implemented will provide the right milieu for long-term growth, the report says.

“The need to take into account a city’s future-proofing capabilities is increasingly recognised by real estate investors, developers and corporations. For investors, it is imperative to comprehend which cities will be able to gain from transformations for long-term value preservation and growth. While Indian cities have performed exceedingly well in the short-term momentum index, it will be a delight to see them become long-term investment destinations in the future,” says Ramesh Nair, CEO and Country Head, JLL India.

Developers can contribute to a city’s success by understanding its strategies and capacity to support new economic activities, enabling them to produce transformational projects that facilitate creativity, innovation and the sustainable communities that businesses are now demanding. With India’s access to talent, a key consideration for corporate location strategies, businesses are bound to grow in cities that have the attributes necessary to attract and retain skilled workforces, he says.

Hyderabad and Bengaluru, have been leading India’s prowess in the global IT/ ITeS and BPM domain. Bengaluru remains the largest Grade A office market in terms of leasing activities. Apart from being a major outsourcing location for multinational corporations, Bengaluru is also home to research and development facilities for a growing number of global companies. However, in recent quarters, Hyderabad has picked pace on account of favourable government policies that have had positive impact on the office market in the city. Global brands like Deloitte, Qualcomm and Microsoft, to name a few have established themselves in the market.

Another trend seen in the report was the relatively lower positions of tier 1 markets of Delhi and Mumbai which were at position 8th and 20th respectively. These are stable markets, with great investment and growth potential. Despite concerns on parameters like sustainability, ecological and infrastructural development etc. these locations, on account of their size, demand and rental and capital values, may be one of the firsts to move towards the long-term investment quadrant in the future. To achieve the same, these markets will have to iron out visible challenges of infrastructure, housing, ecological sustenance etc.

San Francisco, Silicon Valley, New York, London, Boston are amongst the front runners on the annual survey as top global markets. Tokyo, Sydney, Melbourne, Seoul and Singapore represented the Asia – Pacific region on the global top 30 survey. Interestingly Singapore and Seattle are the only two markets amongst those surveyed to show growth on both short-term momentum and robust future-proofing potential.