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Savills unveils Challenger cities

To continue the series of articles around Impacts 2019 themes, this press release unveils Challenger cities – a category in Savills Resilient Cities Index. Where are these cities? What do they have in common? And what do they mean for global real estate investors?

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.

Impacts 2019 series:


  • Cities in India, China and the Middle East growing more resilient and offer investors long-term opportunities - within 10 years China will occupy 43 spots in Savills Top 100 Resilient Cities ranking
  • New York, Tokyo, London, Los Angeles currently Savills top four cities most resilient to global disruption now and in 2028, but ‘challenger cities’ rising fast

Courageous investors looking for long-term returns should look to Middle Eastern, Indian and second tier Chinese cities, such as Riyadh in Saudi Arabia and Delhi in India, as the markets that are likely to grow in the face of global disruption in the coming decades, but today remain relatively untapped, says Savills.

These regions are home to the ‘challenger cities’ identified in Savills Resilient Cities Index.

While the ranking finds that New York, Tokyo, London and Los Angeles are the top four most resilient cities today, and will remain so in 2028, Savills highlights eight ‘challenger cities’ that will enter the top 50 and make the biggest leaps up the ranking in 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. No contenders from either the US or Europe have been awarded ‘challenger city’ status by Savills, with London and Paris the only European cities ranked within the 20 most Resilient Cities Index.

“What our eight challenger cities have in common, says Sophie Chick, director in Savills world research, “is that they 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.”

Simon Hope, head of global capital markets at Savills, comments: “The list of the world’s top global cities may feel like it’s almost set in stone, but, as is becoming apparent, disruption is on the menu and we are set to see some sweeping changes to the way society functions and how businesses operate in the next 10 years. For real estate investors, our Resilient Cities Index shows that the long-established global cities will withstand much in the next decade, which is why they’ve seen high levels of investment as they are perceived as ‘safe havens’ for capital, with the top 10 global destinations for both domestic and cross-border capital in 2018 reflecting this old world order. However, as a result, their real estate assets have become correspondingly expensive and highly sought after.

“As such, our eight ‘challenger cities’ may 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 long-term view. One in five people in the world are Chinese and as their economy continues to grow they will through the effluxion of time become the world’s largest economy, so in particular our Chinese ‘challenger cities’ will offer a wealth of opportunity.” 

Paul Tostevin, Director in Savills world research, adds: “All our ‘challenger city’ contenders are from China, India and the Middle East. While some of these, such as Delhi, Mumbai, Bengaluru, Riyadh and Jeddah are known internationally, they are generally yet to make it onto the global real estate investors’ radar. Those in China - Hangzhou, Nanjing and Ningbo - aren’t well known at all, despite having large populations. What all of them have in common, however, is that they have young populations, are increasing in prosperity and should be able to swiftly pivot in response to the disruption lying ahead.”

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