Moscow Ranks as Top European City for Companies Looking to Expand
4 Oct, 2010, Europe
Although London, Paris and Frankfurt remain the top three European cities to do business in, Moscow has been named the most favourable city in Europe for companies looking to expand according to a survey by Cushman & Wakefield. More companies (47) intend to next expand in the Russian capital than any other European city, a jump from 35 in 2009.
The findings reveal that Vienna, Austria, is the biggest riser this year - moving up six places to rank 22nd best European city for business. London is once again ranked the top business city overall, a position it has held every year since the survey started in 1990. Paris and Frankfurt are again ranked 2nd and 3rd. Brussels moves back into fourth place ahead of Barcelona with an improved score over the year.
In its 21st year, the European Cities Monitor is based on interviews with board directors and senior management in charge of location for the 500 largest companies in Europe. It includes an overall ranking of which European city is considered by the business community to be ‘best for business’ and the ‘best city in which to locate a business today’. In addition to this, 36 cities are ranked against criteria such as quality of life, access to markets, availability and quality of staff, cost of office space, telecommunications and transport links.
The 10 best cities in which to locate a business
Moscow is the top European city for companies looking to expand. Warsaw, which fell to second place in this ranking, was mentioned by 30 companies as their favoured location – a decline from 36 the previous year.
Tim Millard, Managing Director of Cushman & Wakefield in Russia, said: “Major corporates now see Moscow as their top target for future expansion. Strong GDP growth and large scope for increased consumer spending make it an important driver for future company growth and its oil and gas sector retains its allure. This upcoming demand is not yet priced into the market so there remains a small window of opportunity for occupiers to secure their current and future requirements at reasonable rates. Likewise, investment yields are likely to compress rapidly, although it is almost too late to do the best deals.”
London is ranked the number one city in six of the 12 major rankings including access to markets, availability of qualified staff and international and internal transport links. It scores poorly, however, on the cost of staff, the cost of office space and levels of pollution.
James Young, Head of Cushman & Wakefield’s City office in London, commented: “Despite the financial crisis that has gripped the world over the last few years, London has retained its position as the number one place businesses want to be in Europe. Ultimately this is a city that has huge cultural, geographic and language advantages, although it must work hard to ensure that businesses are attracted by government policy and not over-regulated or taxed away."
Germany has performed especially well this year. Düsseldorf has broken into the top 10 for the first time, moving up by five places. As a result, German cities account for four of the top ten cities.
Martin Brühl, Managing Partner Cushman & Wakefield Germany, said: “Of the ten most favoured business locations in Europe almost half - Frankfurt, Berlin, Munich and Dusseldorf - are in Germany. This underlines the high regard for Germany's economic performance and adaptability as well as its politics in these crisis-stricken times."
The top four factors for companies deciding where to relocate their business are, in order of importance; ‘easy access to markets, customers or clients’, ‘availability of quality staff’, ‘quality of telecommunications’ and ‘transport links with other cities and internationally’.
Those surveyed also said that ‘new opportunities from the emerging markets for products and services’ was the factor most likely to impact on business over the next five years. With concerns regarding an ageing population across Europe, ‘demographic and workforce change’ is the second highest ranked.
Elaine Rossall, Head of Business Space Research, Cushman & Wakefield, said: “As companies continue to consolidate and restructure their operations, they are finding that being in the most efficient location can have an overriding impact on the immediate success of their business in achieving its business objectives. As such, companies continue to overwhelmingly favour those cities that principally provide easy access to markets, transport infrastructure and qualified staff. London, Paris and Frankfurt continue to be ranked as the best three cities overall because they yet again score well on these individual factors.”
Key rankings by different criteria
Source: Cushman & Wakefield (full ranking contained in the report)
A copy of the full report can be downloaded from www.europeancitiesmonitor.eu.