JLL NWCs Auckland Greg Clark Jan 2016

8/20/2019 JLL NWCs Auckland Greg Clark Jan 2016

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The BUSINESS of CITIES 1


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The BUSINESS of CITIES

Congratulations…….Auckland

City Centre

Housing and Development

Winyard Quarter

City Rail Link

TPP Opportunity

Next cycle is all about the effects of success

2


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Cycle Dynamics and Cities

1st Cycle

Projects & Physical

Renewal

Promote the Metro

Tourism

EventsFDI

2nd Cycle

Assets

Specialist Agencies

Metro brand

Larger EventsNew funding tools.

Entrepreneurship

Economicdevelopment.

Strategic Visions

Internal governance

reforms

3rd Cycle

Managing growth anddiversification

Business Friendly Metro

Investment Ready Metro

Innovation / Universities

Shaping the future

Metropolitan sphere

Broader leadership

Integrated Brand Alliances

Summits

InternationalisationStrategy

4th Cycle

Managing success at the

international scaleCompetitive benchmarking

Eco-system management

Business Leadership

Dealing with growth andexternalities

External governancereforms.

Global Summits

Signature events

3


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A new urban age

4

• No longer abouthierarchy,

command and

control

• More cities thanever competing

• Size no longerequals success

• Not one model ofsuccess – moreways to win


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Globalization of cities happens in waves

5

Cities (re)entering a global path

Antwerp,Genoa,Istanbul,Venice

Amsterdam,Guangzhou, London,

New York

Berlin, Paris,Birmingham

Bilbao, LiverpoolManchester,

Rotterdam, Vienna

Munich, Seoul,Singapore,

Tokyo, Toronto

Bangalore,Barcelona, Chicago,

Sydney,Tel Aviv

Colombo,Nanjing,Brisbane,

Auckland,Sao Paulo….

1492 -1650

1650 -1780

1780 -1850

1850 -1914

1945 -1973

1985 -

2007

2010 -


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Global Fluency?

6

Leadership with a Worldview Legacy of Global Orientation

Specializations with

Global Reach

Adaptability to GlobalDynamics

Culture of Knowledgeand Innovation

Opportunity and Appeal to the World

Compelling Global Identity

Government as GlobalEnabler

Ability to Secure Investmentfor Strategic Priorities

International Connectivity


7/46The BUSINESS of CITIES

New Globalising Cities

• New World of Cities isabout more than justbig global cities

• Not only corporatehubs and financial

centres• Changing global

geographies

• New Roles

• Hybrids andtransformers

• Different types of citieswith distinctivesuccess models

7



The Established World Cities: the ‘Big Six’

8

Uniquely globalised

Corporate clusters with globalreach

Biggest shares of financial andbiz services

Strong infrastructure platform

Cultural appeal

Political and legal frameworks

Magnets for global FDI



The Established World Cities: leading hubs for

knowledge and talent

9



Established World Cities: Destination Power

10



• Biggest publictransport, logistics,

uti li ty, IT and airport

systems

• Challenge to invest,maintain and upgradeinfrastructure

• Externalities withinMetros

11

Established World Cities:

unintended consequences of success

• Not the mostliveable

• Congestion• Housing affordability

crises

• Higher risks

• Not the mostsustainable: butperform well for

size

• Improving policiesfor resilience

• Tacklingexternalities at

national level.



Emerging World Cities – a new economic

geography

• New cities integrating intoglobal economy

• New centres of demandand supply, new corporategateways to large domesticeconomies

• New HQ locations

• Some also becoming

financial centres

12



Emerging World Cities – new roles

• Closing thegap asfinancialcentres

• Tokyo andParis beingovertaken byShanghai,Singapore,

and Taipei

13


14/46The BUSINESS of CITIES 14

Emerging World Cities: diverse roles



A typology of emerging world cities

15

• Shanghai and Beijing nearly emerged

• 2nd tier – competitive megaci ties -many rapidly improving gateways,challenges remain

• 3rd and 4th tier – high potential butconstrained cities

• 4th tier – struggling megacities orcities starting 1st globalisation cycle



Emerging World Cities: key priorities

• Physical capital =urgent deficit

• To move up valuechains, by attractingtalent not justinvestment

• From production toinnovation

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The new silk road?

17

l


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The BUSINESS of CITIES 18

TokyoSeoul

Busan

Beijing

Shanghai

Taipei

Manila

Jakarta

Singapore

KL

Bangkok

Mumbai

New Delhi

Bangalore

HK

Wuhan

Hangzhou

Nanjing

Guangzhou Shenzhen

Big Six

Asian cities in two cycles time?

Institutions, diplomacy, domestic fir

Tech and innovation hubs

Tourism and entertainment

Adv. manufacturing + trade

High quality of life

Osaka

Colombo

Xi’an


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New World Cities

19

Smaller, specialised and agile

Rapidly globalising

Good infrastructure, high quality oflife, fewer negative externalities

Knowledge centres

Culture/entertainment

High-tech / innovation / R&D

Convention / tourism hubs


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New World Cities - Drivers

• Global economic centre of gravity shifting East and South

• Mobility and reach of new global middle classes

• Urbanisation reshaping economic and spatial balances

• New business sectors are internationalising

• Technology driving new systems of production and integration

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New World Cities: attraction to global investment

21

Punch above their

weight

Tech and start-up culture

Liveability

Attraction to investorsseeking value beyond

established andemerging cities


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New World Cities: comparative advantages

• Business and Investorfriendliness: e.g.Miami, Santiago

• Innovation and techsector leadership: e.g.Melbourne, Toronto,Boston.

• Climate, urbanenvironment andlifestyle: e.g.

Auckland, Barcelona

22


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H d h d?


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How do they succeed?Combining global leadership with local quality

• Size: smaller, more agile, and affordable

• Expert specialisation within a more managed metropolis

• Better live-work balance

• Efficient infrastructure

• Problem-solving capabilities

• Low congestion, inflation, and pollution

• Safety, security, education

• Clear leadership identity


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New World Cities: sustaining advantages for 2+ cycles

• Danger of becoming ‘one trick pony’

• Need to address externalities of success, maintain

quality: e.g. Auckland ‘SuperCity’, Greater SydneyCommission, Barcelona Global Talent Programme, OsloRegion

• Challenges include: rising costs / prices, access toentrepreneurs, digital infrastructure, congestion, over-reliance on tourism

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Auckland’s key traits and spidergram

26

Global FirmsBusiness fr iendliness

Financial services

Investment

attraction

Talent and

labour market

Higher education

R&D and

innovationLiveability

Wages

and

costs

Sustainability

Transport and

infrastructure

Culture and

diversity

Visitor and

Destination power

Image, brand

and influence

Liveability and

sustainability isits USP

Attraction toinvestors, visitors,talent & tech

Infrastructureimproving


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Auckland’s strong cycle of growth viz NWC

27

Post-crisis economic performance

Source: Brookings and GaWC


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Auckland: smaller but plugged in

28

• Small economy byworld city standards

BUT

One of the mostdynamic

Highly globalised forits size

GDP ($US bns)

GDP per

Capita ($US‘000)

Global

Connectivity Rank(GaWC)

IBM Most

Competitive Cities‘International HQs’

No of Cities 300 300 300+ 100

Sydney 223 46 9 17

Toronto 276 45 17 8

Vienna 184 49 27 18

San Francisco 331 72 28 14

Melbourne 178 40 34 26

Miami 263 44 36 24

Barcelona 171 36 37 25

Boston 360 76 39

Munich 220 56 42

Stockholm 143 56 43 11

Copenhagen 127 42 48 15

Tel Aviv 153 43 60 49

Berlin 158 36 63 10 Auckland 50 32 72 35

Vancouver 110 44 76 23

Oslo 74 53 79

Brisbane 97 42 80

Helsinki 77 48 81 29

Seattle 267 73 99

Denver 170 62 106


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An investment magnet

29

EmergingTrends in

Real Estate

JLL Global 300JLL City

MomentumIndex

JLL

InvestmentIntensity

IndexCommercial Attraction

Index

CrossBorder Real

EstateInvestment

No of Cities

EU 28, US 75,

Canada 9, AP 22300 120 25

Sydney 2 23 11 8 4

Berlin 1 48 21 - -

Toronto 2 25 29 - -

San Francisco8 17 6 10 11

Munich 10 33 13 - 2

Miami 19 34 35 - -

Melbourne 3 43 24 18 12

Copenhagen 5 67 45 - 6

Boston 13 23 10 5 17

Oslo - 70 54 - 5

Vancouver 1 83 73 - -

Seattle 4 40 16 13 20Stockholm 11 45 12 - 10

Barcelona 12 56 41 - -

Auckland 10 102 58 20 7

Denver 6 39 25 - 25

Helsinki 16 91 61 - -

Vienna 23 64 40 - -

Brisbane - 78 50 - 22

Tel Aviv - 90 193 - -

• Punches well above weight

• 7th in JLL InvestmentIntensi ty Index (investmentrelative to size)

• Top 10 Investment Promotion

Strategy (fDi)

• About to join top 20 citiesglobally in 2016 index


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A liveability capital

Mercer

Quality ofLivingSurvey

EIU

LiveabilityIndex

Global

LiveableCities Index

Monocle

Quality ofLivingSurvey

No. of Cities 230 140 63 25+

Vienna 1 2 - 2

Toronto 15 4 - -

Melbourne 16 1 13 4

Helsinki 31 10 4 8

Sydney10 7 14 5

Auckland 3 9 8 17

Vancouver 5 13 12 7

Stockholm 19 24 5 6

Berlin 14 20 11 3

Munich 4 28 - 9

Copenhagen 9 22 9 10

Brisbane 37 18 - -

San Francisco 27 49 - -Seattle 44 46 - -

Oslo 31 23 - 23

Miami 65 37 - -

Boston 34 33 23 -

Barcelona 38 31 29 24

Tel Aviv 105 76 - -

30

Top 10% of most liveable cities

Attracts people and talent

Platform for cultural, tourism andinnovation economy

Cornerstone of The Auckland Plan


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Key dimensions of Auckland’s liveability

31

Stability

GLCI

Culture and environment

Public services

Governance

GLCI

GLCIEIU


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Specialisation in

newly traded markets

32

IESE Cities in Motion IndexRank

Melbourne 2

Sydney 4

Berlin 9

Munich 11

Vancouver 13

Toronto 13

Boston 13

Vienna 16

Auckland 18

Brisbane 18

Stockholm 24Copenhagen 27

San Francisco 27

Barcelona 30

Helsinki 34

Oslo 60

QS Best Student Cities‘Technology’

‘Mobility andTransportation’

No. of Cities 148

Munich 26 3

Boston 10 26

Copenhagen 32 4

Helsinki 29 9Vienna 40 2

Berlin 33 17

Stockholm 36 15

Melbourne 18 35

San Francisco 5 61

Auckland 24 43

Barcelona 49 20Oslo 44 32

Toronto 30 63

Sydney 16 95

Vancouver 41 89

Tel Aviv 102 87

Miami 77 133

Strong infrastructure

platform


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Improving brand with global audiences

33

City RepTrak Brand scores, 2015 • Strongreputation forvisitor andresidentamenities

• Distance fromkey markets

• Lacks global

stature, andreputation forpulse anddynamism


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Imperative to grow innovation

34

AONPeople Risk

Index

2thinknowInnovation

Cities Index

IESE Cities inMotion 'Human

Capital'

IBM World’sMost

CompetitiveCities ‘LifeSciencesR&D and

Production’

IBM World'sMost

CompetitiveCities

'Software andWeb

Development'

No of Cities 138 445 148 100 100

Boston 10 4 2 - -

San Francisco 13 1 6 11 3

Munich - 7 20 - -

Seattle 21 10 - - -

Berlin 40 13 13 5 5

Toronto 3 11 36 14 9

Stockholm 15 16 57 4 6

Oslo 16 32 39 - -

Copenhagen 7 9 80 8 21

Helsinki 34 25 53 18 15

Melbourne 21 23 35 35 25

Miami 21 48 19 34 32Vancouver 10 39 59 32 17

Vienna 37 6 60 19 28

Barcelona 49 56 40 18 23

Sydney 27 17 48 36 30

Brisbane - 60 - - -

Denver 27 70 - - -

Tel Aviv45 24 67 39 44

Auckland 40 106 94 43 36

• Behind other new world citiesin terms of scale

BUT

Strong conditions for growth:ease of doing business,diversity, tolerance

High expenditure on R&D

Culture of entrepreneurship

(Source: Solidance)


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Auckland - comments

Great progress in benchmarks scores-momentum. For a city of this size and location

Auckland is starting to punch above its weight.

Auckland does very well in JLL Momentum Index principally because of its diversepopulation, young population and its strong push towards tech, all key ingredients forreal estate attractiveness.

The strongest peers based on data to Auckland include Oslo, Vancouver and Helsinki.

Visitor and Destination Power is a reflection of volume of visitors and conferencesrather than attractiveness. Auckland is just outside top 100 cities for both inEuromonitor and ICCA rankings. Distance is key issue.

Auckland’s economic growth is due to:

(i) high in-migration boosting retail and housing demand,(ii) dynamic tourism growth,(iii) high foreign investment in real estate,(iv) a cost-competitive tech sector, and(v) services sectors concentrated in the CBD.

More effective use of land is seen as essential to sustain growth in the next cycle.

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The real estate perspective

36

Established World Cities• Aim to capture footloose people and capital• Challenges: bold urban transformation to stay competitive, land

pressure, affordability, housing

Emerging World Cities• Need catalytic FDI, nurture local capital and talent• Massive Real Estate expansion under way.• Next phase: create a sense of place

New World Cit ies

• Want mobile millennials, students, entrepreneurs.• Millennials have stringent real estate demands• Innovative, sustainable, technologically advanced


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Strategic

imperatives

for each

type of city

37


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Strategic

imperatives

for each

type of city

38


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JLL Momentum Index


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JLL Momentum Index

Highlights – The Rise of the Innovation-Oriented City

• Innovation-Oriented Cities Dominate the Top 20

• Strong Momentum of ‘Established World Cities’ andtheir ‘Challengers’

• Increasing Momentum in US ‘New World Cities’

• Innovation Driving ‘Agile Higher Value Emerging Cities’

• Smaller Cities Achieving Global Reach

• Asia Pacific showing Strength

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City Momentum Index Model

41

Higher EducationInfrastructure

Innovation Capability

International PatentApplications

Technology / Venture Capital

Environmental Quality

High-Value

incubators

Short-Term

Momentum

Construction, Absorption,Price

Investment Transactions

Transparency

Commercial

Real Estate Momentum

Economic Output

Population

Air Connectivity

Fortune 2000 HQs

Foreign Direct Investment

Source: JLL, January 2016

Socio-Economic

Momentum

High-Value

incubators

City Momentum

Index


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JLL City Momentum Index 2016 – Top 20

42

Population Connectivity Technology and R&D Education Environment

Economic Output Corporate Activity ConstructionReal Estate

InvestmentProperty Prices

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

London

Silicon Valley

DublinBangalore

Boston

Shanghai

New York

Sydney

Beijing

San Francisco

Nairobi

Shenzhen

SeattleTokyo

Nanjing

Austin

Hyderabad

Melbourne

Seoul

Auckland

JLL City Momentum Index 2016 Sub Index


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JLL City Momentum Index 2016 – Sub-Index

Top 5

43

1

2

3

4

5

Future Proofing

Silicon Valley

London

Paris

Boston

Tokyo

1

2

3

4

5

Real Estate

Momentum

Dublin

London

Auckland

Nairobi

Boston

1

2

3

4

5

Socio-Economic

Dynamism

Hanoi

Bangalore

Ho Chi Minh City

Hyderabad

Delhi


Future Proofing: Higher education infrastructure; innovation capability; international patent applications; technology/venture capital;

environmental qualityReal Estate Momentum: Office and Retail construction, absorption and price; investment transactions; transparency

Socio-Economic D namism: Economic out ut o ulation air connectivit Fortune 2000 H s FDI


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City Momentum Index 2016: Short v Long Term

44


Short - Term MomentumLowest Highest

Nairobi, Delhi

Nanjing, Xi’an

Hyderabad, Chennai

Dublin, Auckland

Shanghai, BeijingShenzhen, Bangalore

LondonSan Francisco Bay

Boston, New York

Sydney

Tokyo, Hong KongParis, Randstad

Seoul, Los Angeles

Melbourne, Austin

Singapore, TorontoBrussels, Chicago

Berlin, Taipei

Stockholm, San Diego

H i g h - V a l u e

I n c u b a t o r s

Lowest

Highest


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City Momentum Index

45

Covers 120 Cities

Vancouver, Calgary, Toronto, Montreal

Washington DC, Baltimore,

Philadelphia, New York, Pittsburgh,

Boston

Minneapolis, Chicago, St Louis, Detroit

Charlotte, Atlanta, Orlando, Miami,

Tampa

Denver, Austin, Dallas, Houston

Las Vegas, Phoenix

Seattle, Portland, San Francisco,

Silicon Valley, Los Angeles, San Diego

North America 31

Mexico City

Lima, Bogota

Sao Paulo, Rio de Janeiro

Santiago, Buenos Aires

Latin America 7

Oslo, Stockholm, Copenhagen, Helsinki

Dublin, Glasgow, Edinburgh,

Manchester, Birmingham, London

Brussels, Randstad, Paris, Lyon

Hamburg, Berlin, Dusseldorf, Cologne,

Frankfurt, Stuttgart, Munich, Zurich,

Vienna, Luxembourg

Lisbon, Madrid, Barcelona

Milan, Rome, Athens

Prague, Budapest, Warsaw, Bucharest,

Kiev, Moscow, St Petersburg

Istanbul

Abu Dhabi, Dubai, Jeddah, Riyadh

Casablanca, Cairo

Cape Town, Johannesburg

Lagos, Nairobi

EMEA 48Seoul, Osaka, Tokyo

Beijing, Tianjin, Shanghai,

Chengdu, Wuhan, Guangzhou,

Shenzhen, Chongqing, Nanjing, Xian,

Shenyang

Hong Kong, Taipei

Delhi, Kolkata, Mumbai, Hyderabad,

Bangalore, Chennai

Bangkok, Ho Chi Minh City, Hanoi,

Kuala Lumpur, Singapore, Jakarta,

Manila

Perth, Brisbane, Melbourne, Sydney,

Auckland

Asia Pacific 34


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Auckland

Celebrate amazing progress….. And momentumRecognise externalities and organise for them.Shift from cycle 2 to cycle 3…….Map how the success model will change:

private amenity to shared liveabilitymix of densitiesgrowth of evening economy

New opportunities and catalysts. TPP?

Get the story clear at home and tell it abroad. Australia and NZ together? OBOR?Learn with peers

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JLL NWCs Auckland Greg Clark Jan 2016

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