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

The BUSINESS of CITIES

Cycle Dynamics and Cities

4th Cycle
3rd Cycle

1st Cycle
Projects & Physical
Renewal
Promote the Metro
Tourism
Events
The BUSINESS
of CITIES
FDI

Managing growth and

diversification
Business Friendly Metro
2nd Cycle
Investment Ready Metro
Assets
Innovation / Universities
Specialist Agencies
Shaping the future
Metro brand
Metropolitan sphere
Larger Events
Broader leadership
New funding tools.
Integrated Brand
Entrepreneurship
Alliances
Economic
Summits
development.
Internationalisation
Strategic Visions
Strategy
Internal governance
reforms

Managing success at the

international scale
Competitive benchmarking
Eco-system management
Business Leadership
Dealing with growth and
externalities
External governance
reforms.
Global Summits
Signature events
3

A new urban age

No longer about
hierarchy,
command and
control
More cities than
ever competing
Size no longer
equals success
Not one model of
success more
ways to win

The BUSINESS of CITIES

Globalization of cities happens in waves

Cities (re)entering a global path

2010 -

1492 1650

Antwerp,
Genoa,
Istanbul,
Venice

1650 1780

Amsterdam,
Guangzhou, London,
New York

The BUSINESS of CITIES

1780 1850

Berlin, Paris,
Birmingham

1850 1914

Bilbao, Liverpool
Manchester,
Rotterdam, Vienna

1945 1973

Munich, Seoul,
Singapore,
Tokyo, Toronto

1985 2007

Bangalore,
Barcelona, Chicago,
Sydney,
Tel Aviv

Colombo,
Nanjing,
Brisbane,
Auckland,
Sao Paulo.

Global Fluency?

Leadership with a Worldview

Compelling Global Identity

Government as Global
Enabler

Ability to Secure Investment

for Strategic Priorities

International Connectivity

The BUSINESS of CITIES

Legacy of Global Orientation

Specializations with
Global Reach

Adaptability to Global
Dynamics

Culture of Knowledge
and Innovation

Opportunity and Appeal to the World

New Globalising Cities

New World of Cities is

about more than just
big global cities
Not only corporate
hubs and financial
centres
Changing global
geographies
New Roles
Hybrids and
transformers
Different types of cities
with distinctive
success models
The BUSINESS of CITIES

The Established World Cities: the Big Six

Uniquely globalised
Corporate clusters with global
reach
Biggest shares of financial and
biz services
Strong infrastructure platform
Cultural appeal
Political and legal frameworks
Magnets for global FDI

The BUSINESS of CITIES

The Established World Cities: leading hubs for

knowledge and talent

The BUSINESS of CITIES

Established World Cities: Destination Power

The BUSINESS of CITIES

10

Established World Cities:

unintended consequences of success
Not the most
Biggest public
liveable
transport, logistics,
utility, IT and airport
systems
Congestion
Housing affordability
Challenge to invest,
crises
maintain and upgrade Higher risks
infrastructure
Externalities within
Metros

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Not the most

sustainable: but
perform well for
size
Improving policies
for resilience
Tackling
externalities at
national level.

11

Emerging World Cities a new economic

geography

The BUSINESS of CITIES

New cities integrating into

global economy

New centres of demand

and supply, new corporate
gateways to large domestic
economies

New HQ locations

Some also becoming

financial centres

12

Emerging World Cities new roles

Closing the
gap as
financial
centres
Tokyo and
Paris being
overtaken by
Shanghai,
Singapore,
and Taipei

The BUSINESS of CITIES

13

Emerging World Cities: diverse roles

The BUSINESS of CITIES

14

A typology of emerging world cities

Shanghai and Beijing nearly emerged
2nd tier competitive megacities many rapidly improving gateways,
challenges remain

3rd and 4th tier high potential but

constrained cities

4th tier struggling megacities or

cities starting 1st globalisation cycle

The BUSINESS of CITIES

15

Emerging World Cities: key priorities

Physical capital =
urgent deficit
To move up value
chains, by attracting
talent not just
investment
From production to
innovation

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16

The new silk road?

The BUSINESS of CITIES

17

Asian cities in two cycles time?

Beijing
Xian

Nanjing

Seoul
Busan

Tokyo
Osaka

Wuhan
Shanghai
Hangzhou
Taipei
Guangzhou
Shenzhen

New Delhi

HK

Mumbai

Manila

Bangkok
Bangalore

Big Six

Colombo
KL

Tech and innovation hubs

Singapore
Jakarta

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Adv. manufacturing + trade

High quality of life

Institutions, diplomacy, domestic firm

Tourism and entertainment

18

New World Cities

Smaller, specialised and agile

Rapidly globalising
Good infrastructure, high quality of
life, fewer negative externalities

The BUSINESS of CITIES

Knowledge centres
Culture/entertainment
High-tech / innovation / R&D
Convention / tourism hubs

19

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

The BUSINESS of CITIES

20

New World Cities: attraction to global investment

Punch above their

weight
Tech and start-up culture
Liveability
Attraction to investors
seeking value beyond
established and
emerging cities

The BUSINESS of CITIES

21

New World Cities: comparative advantages

Business and Investor
friendliness: e.g.
Miami, Santiago
Innovation and tech
sector leadership: e.g.
Melbourne, Toronto,
Boston.
Climate, urban
environment and
lifestyle: e.g.
Auckland, Barcelona
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22

New World Cities: key strengths

The BUSINESS of CITIES

23

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

The BUSINESS of CITIES

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 Sydney
Commission, Barcelona Global Talent Programme, Oslo
Region

Challenges include: rising costs / prices, access to

entrepreneurs, digital infrastructure, congestion, overreliance on tourism
The BUSINESS of CITIES

25

Aucklands key traits and spidergram

Image, brand
and influence

Global Firms
Business friendliness

Visitor and
Destination power

Financial services

Investment
attraction

Culture and
diversity

Talent and
labour market

Transport and
infrastructure

Higher education

Sustainability
Wages
and
costs

The BUSINESS of CITIES

Liveability

Liveability and
sustainability is
its USP
Attraction to
investors, visitors,
talent & tech
Infrastructure
improving

R&D and
innovation

26

Aucklands strong cycle of growth viz NWC

Post-crisis economic performance

Source: Brookings and GaWC

The BUSINESS of CITIES

27

Auckland: smaller but plugged in

GDP per
Global
IBM Most
GDP ($US bns) Capita ($US Connectivity Rank Competitive Cities
000)
(GaWC)
International HQs
No of Cities

300

300

300+

100

Sydney
Toronto
Vienna
San Francisco
Melbourne
Miami
Barcelona
Boston
Munich
Stockholm
Copenhagen
Tel Aviv
Berlin
Auckland
Vancouver
Oslo
Brisbane
Helsinki
Seattle
Denver

223

46

17

276

45

17

184

49

27

18

331

72

28

14

178

40

34

26

263

44

36

24

171

36

37

25

360

76

39

220

56

42

143

56

43

11

127

42

48

15

153

43

60

49

158

36

63

10

50

32

72

35

110

44

76

23

74

53

79

97

42

80

77

48

81

267

73

99

170

62

106

The BUSINESS of CITIES

Small economy by
world city standards
BUT
One of the most
dynamic
Highly globalised for
its size

29

28

An investment magnet
JLL Global 300
JLL
Emerging
JLL City
Investment
Trends in
Momentum
Intensity
Cross
Real Estate Commercial
Index
Index
Border Real
Attraction
Estate
Index
Investment
No of Cities

Sydney
Berlin
Toronto
San Francisco
Munich
Miami
Melbourne
Copenhagen
Boston
Oslo
Vancouver
Seattle
Stockholm
Barcelona
Auckland
Denver
Helsinki
Vienna
Brisbane
Tel Aviv

EU 28, US 75,
Canada 9, AP 22

300

120

25

23

11

48

21

25

29

17

10

11

10

33

13

19

34

35

43

24

18

12

67

45

13

23

10

17

70

54

83

73

40

16

13

20

11

45

12

10

12

56

41

10

102

58

20

39

25

25

16

91

61

23

64

40

78

50

22

90

193

The BUSINESS of CITIES

Punches well above weight

7th in JLL Investment
Intensity Index (investment
relative to size)
Top 10 Investment Promotion
Strategy (fDi)
About to join top 20 cities
globally in 2016 index
29

A liveability capital

No. of Cities

Vienna
Toronto
Melbourne
Helsinki
Sydney
Auckland
Vancouver
Stockholm
Berlin
Munich
Copenhagen
Brisbane
San Francisco
Seattle
Oslo
Miami
Boston
Barcelona
Tel Aviv

Mercer
Quality of
Living
Survey
230
1

Monocle
EIU
Global
Quality of
Liveability Liveable
Living
Index Cities Index
Survey
140
63
25+
2
2

15

16

13

31

10

10

14

17

13

12

19

24

14

20

11

28

22

10

37

18

27

49

44

46

31

23

23

65

37

34

33

23

38

31

29

24

105

76

The BUSINESS of CITIES

Top 10% of most liveable cities

Attracts people and talent
Platform for cultural, tourism and
innovation economy
Cornerstone of The Auckland Plan
30

Key dimensions of Aucklands liveability

Stability

Public services
GLCI

GLCI

Culture and environment

EIU

The BUSINESS of CITIES

Governance
GLCI

31

Specialisation in
newly traded markets
QS Best Student Cities
Melbourne
Sydney
Berlin
Munich
Vancouver
Toronto
Boston
Vienna
Auckland
Brisbane
Stockholm
Copenhagen
San Francisco
Barcelona
Helsinki
Oslo
The BUSINESS of CITIES

Rank
2
4
9
11
13
13
13
16
18
18
24
27
27
30
34
60

Strong infrastructure
platform
IESE Cities in Motion Index
Technology
No. of Cities

Munich
Boston
Copenhagen
Helsinki
Vienna
Berlin
Stockholm
Melbourne
San Francisco
Auckland
Barcelona
Oslo
Toronto
Sydney
Vancouver
Tel Aviv
Miami

Mobility and
Transportation
148

26

10

26

32

29

40

33

17

36

15

18

35

61

24

43

49

20

44

32

30

63

16

95

41

89

102

87

77

133

32

Improving brand with global audiences

City RepTrak Brand scores, 2015

Strong
reputation for
visitor and
resident
amenities
Distance from
key markets
Lacks global
stature, and
reputation for
pulse and
dynamism

The BUSINESS of CITIES

33

Imperative to grow innovation

IBM Worlds
Most
AON
2thinknow
IESE Cities in Competitive
People Risk Innovation Motion 'Human Cities Life
Sciences
Cities Index
Capital'
Index
R&D and
Production
No of Cities

138

Boston
13
San Francisco
Munich
21
Seattle
40
Berlin
3
Toronto
15
Stockholm
16
Oslo
7
Copenhagen
34
Helsinki
21
Melbourne
21
Miami
10
Vancouver
37
Vienna
49
Barcelona
27
Sydney
Brisbane
27
Denver
45
Tel Aviv
40
Auckland
The BUSINESS of CITIES
10

IBM World's
Most
Competitive
Cities
'Software and
Web
Development'

445

148

100

100

11

20

10

13

13

11

36

14

16

57

32

39

80

21

25

53

18

15

23

35

35

25

48

19

34

32

39

59

32

17

60

19

28

56

40

18

23

17

48

36

30

60

70

24

67

39

44

106

94

43

36

Behind other new world cities

in terms of scale
BUT
Strong conditions for growth:
ease of doing business,
diversity, tolerance
High expenditure on R&D
Culture of entrepreneurship
(Source: Solidance)
34

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 diverse
population, young population and its strong push towards tech, all key ingredients for
real 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 conferences
rather than attractiveness. Auckland is just outside top 100 cities for both in
Euromonitor and ICCA rankings. Distance is key issue.
Aucklands 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.
The BUSINESS of CITIES

35

The real estate perspective

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 Cities

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

The BUSINESS of CITIES

36

Strategic
imperatives
for each
type of city

The BUSINESS of CITIES

37

Strategic
imperatives
for each
type of city

The BUSINESS of CITIES

38

Strategic
imperatives
for each
type of city

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39

JLL Momentum Index

Highlights The Rise of the Innovation-Oriented City
Innovation-Oriented Cities Dominate the Top 20
Strong Momentum of Established World Cities and
their Challengers
Increasing Momentum in US New World Cities
Innovation Driving Agile Higher Value Emerging Cities
Smaller Cities Achieving Global Reach
Asia Pacific showing Strength

The BUSINESS of CITIES

40

City Momentum Index Model

Socio-Economic
Momentum

Commercial
Real Estate Momentum

Economic Output
Population
Air Connectivity
Fortune 2000 HQs
Foreign Direct Investment

Construction, Absorption,
Price
Investment Transactions
Transparency

Short-Term
Momentum

High-Value
incubators

Higher Education
Infrastructure
Innovation Capability
International Patent
Applications
Technology / Venture Capital
Environmental Quality

High-Value
incubators

City Momentum
Index
Source: JLL, January 2016

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41

JLL City Momentum Index 2016 Top 20

London
Silicon Valley
Dublin
Bangalore
Boston
Shanghai
New York
Sydney
Beijing
San Francisco

11

12

13

14

15

16

17

18

19

10

20

Nairobi
Shenzhen
Seattle
Tokyo
Nanjing
Austin
Hyderabad
Melbourne
Seoul
Auckland

Population

Connectivity

Technology and R&D

Education

Environment

Economic Output

Corporate Activity

Construction

Real Estate
Investment

Property Prices

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42

JLL City Momentum Index 2016 Sub-Index

Top 5
Real Estate
Momentum

Future Proofing

Socio-Economic
Dynamism

Silicon Valley

Dublin

Hanoi

London

London

Bangalore

Paris

Auckland

Ho Chi Minh City

Boston

Nairobi

Hyderabad

Tokyo

Boston

Delhi

Source: JLL, January 2016

The

Future Proofing: Higher education infrastructure; innovation capability; international patent applications; technology/venture capital;
environmental quality
Real
Momentum: Office and Retail construction, absorption and price; investment transactions; transparency
BUSINESS
ofEstate
CITIES

43

City Momentum Index 2016: Short v Long Term

Tokyo, Hong Kong
Paris, Randstad
Seoul, Los Angeles
Melbourne, Austin

London
San Francisco Bay
Boston, New York
Sydney
Dublin, Auckland
Shanghai, Beijing
Shenzhen, Bangalore

High-Value Incubators

Singapore, Toronto
Brussels, Chicago
Berlin, Taipei
Stockholm, San Diego

Highest

Nairobi, Delhi
Nanjing, Xian
Hyderabad, Chennai
Lowest
Lowest

Short - Term Momentum

Highest

Source: JLL, January 2016

The BUSINESS of CITIES

44

City Momentum Index

Covers 120 Cities
North America

EMEA

31

Vancouver, Calgary, Toronto, Montreal

Washington DC, Baltimore,
Philadelphia, New York, Pittsburgh,
Boston

48

Oslo, Stockholm, Copenhagen, Helsinki

Dublin, Glasgow, Edinburgh,
Manchester, Birmingham, London

Asia Pacific

34

Seoul, Osaka, Tokyo

Beijing, Tianjin, Shanghai,

Chengdu, Wuhan, Guangzhou,
Shenzhen, Chongqing, Nanjing, Xian,
Shenyang

Minneapolis, Chicago, St Louis, Detroit

Brussels, Randstad, Paris, Lyon

Charlotte, Atlanta, Orlando, Miami,

Tampa

Hamburg, Berlin, Dusseldorf, Cologne,

Frankfurt, Stuttgart, Munich, Zurich,
Vienna, Luxembourg

Hong Kong, Taipei

Lisbon, Madrid, Barcelona

Bangkok, Ho Chi Minh City, Hanoi,

Kuala Lumpur, Singapore, Jakarta,
Manila

Denver, Austin, Dallas, Houston

Las Vegas, Phoenix

Milan, Rome, Athens

Seattle, Portland, San Francisco,

Silicon Valley, Los Angeles, San Diego

Latin America
Mexico City
Lima, Bogota
Sao Paulo, Rio de Janeiro
Santiago, Buenos Aires

The BUSINESS of CITIES

Prague, Budapest, Warsaw, Bucharest,

Kiev, Moscow, St Petersburg

Istanbul

Delhi, Kolkata, Mumbai, Hyderabad,

Bangalore, Chennai

Perth, Brisbane, Melbourne, Sydney,

Auckland

Abu Dhabi, Dubai, Jeddah, Riyadh

Casablanca, Cairo
Cape Town, Johannesburg
Lagos, Nairobi

45

Auckland
Celebrate amazing progress.. And momentum
Recognise externalities and organise for them.
Shift from cycle 2 to cycle 3.
Map how the success model will change:
private amenity to shared liveability
mix of densities
growth 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
The BUSINESS of CITIES

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