Tokyo bagged the top spot in in JLL’s latest Global Commercial Attraction Index, which gauges a city’s economic and property power based on the weighted score of six indicators: estimated GDP (PPP), total passengers of a city’s airports, number of top multinational corporations (MNCs) headquartered in the city, current office supply and commercial real estate investment volumes over the past three years.
The Japanese capital was followed by New York and London to complete the top three spots.
“Greater Tokyo’s economy exceeds US$1.4 trillion (S$1.81 trillion) and, with nearly 38 million consumers, its domestic market far exceeds even that of New York, London and Paris. The city region is also home to more Forbes Global 2000 headquarters than any other city,” said the consultancy.
According to JLL, aside from Prime Minister Shinzo Abe’s economic policies and the upcoming 2020 Olympic Games that will be held there, another factor that has aided the city in clinching the top status in the firm’s index is the US$54 billion (S$69.81 billion) worth of direct commercial property investments from Q2 2011 to Q2 2014. Additionally, prime office rents and capital values in the metropolis are both expected to surge by 10 to 20 percent next year.
Although Tokyo is one of world’s biggest corporate bases, financial markets and R&D centres, with world-class infrastructure and educational opportunities, it has low levels of market transparency as shown by its lower scores on business-friendliness.
In contrast, its regional peer Singapore was lauded for its ease of doing business, but the city-state only managed to take the 15th spot in the Global Commercial Attraction Index.
“An emphasis on business-friendliness and its status as a regional hub, benefiting from increased capital flows to Asia, has propelled Singapore into a global financial centre and technology research centre,” it noted.
JLL also highlighted that Tokyo was the least polluted city in Asia, followed by Osaka and Singapore based on a study by the World health Organisation (WHO). But Singapore trumped Tokyo when it grabbed the top spot in Siemens Asian Green City Index thanks to the republic’s eco-friendly initiatives.
Moreover, direct commercial property investments in Singapore reached US$27 billion (S$34.91 billion) between Q2 2011 and Q2 2014, while prime office rents and capital values there are both forecasted to rise by 0 percent to five percent in 2015.
Nikki De Guzman, Editor at CommercialGuru, edited this story. To contact her about this and other stories, email firstname.lastname@example.org