While investment decisions will always depend on the individual – their appetite for risk, their level of experience and expertise and the level of return they’re looking for – away from the main global gateway cities such as London, New York, Tokyo and Paris, a growing number of exciting locations is emerging, with all the ingredients needed to make them attractive long-term commercial real estate investment choices for the private investor.
In this article we highlight three cities in the Americas that are leading the way in developing a compelling mix of education, lifestyle, infrastructure, technology and real estate and, in the process, becoming the kind of vibrant, attractive locations where people want to work, shop, play and live.
While each of the cities featured here is unique, they do have certain characteristics in common. In particular, the rapid growth of technology companies is driving a wave of regeneration and development that echoes through all real estate sectors.
Cities that can provide a favourable environment for this type of business are seeing significant investor interest.
A large part of the attraction for these in-moving tech firms is the prospect of becoming part of an ecosystem that has been designed to attract the best talent. Education is a critical component, ensuring a regular flow of the type of highly skilled employees so sought after by fast-growing companies in the global “war for talent”.
And hand-in-hand with this comes demand not only for office space, but for housing, retail, logistics, hotels and other types of income-producing real estate.
Often thought of as a tourist destination and home for wealthy residents, drawn by healthy tax incentives and an abundance of sunshine, rather than as a commercial property hotspot, Florida’s most famous city is reinventing itself as a creative and technology hub.
In-movers such as Microsoft’s Innovation Centre, the company’s first in the US, in 2014 and the emergence of a lively art scene around Art Basel have led to new districts, restaurants and galleries and attracted a new generation of residents.
The retail sector in particular is thriving with the recently opened Brickell City Centre supermall, part of a wider US$1.05bn mixed-use development, adding new names to the roster of global and boutique retailers already located in the expanding Miami Design District and Wynwood Arts District, plus the new Miami Worldcenter development, scheduled to open in 2017. In addition, the city’s education offer continues to improve with the University of Miami’s business and law schools rising up the rankings.Properties for sale in Miami
Mexico City: Mexico
Supported by a broad base of corporate industries such as automotive, telecommunications, logistics and retail, Mexico City continues to attract significant foreign direct investment as the gateway to emerging markets in the rest of Latin America.
The city’s growing middle class is spurring significant redevelopment and regeneration. Large mixed-use projects are transforming neighbourhoods including Paseo de la Reforma, Polanco and Insurgentes and include modern housing and offices as well as shopping centres.
Indeed, the office market has grown by 200% since 2000, with 170 new buildings. And with a new international airport under construction, Mexico City is investing in the future. The first phase of development, scheduled to be completed in the early 2020s, is expected to provide capacity for up to 50 million passengers and 550,000 flights a year. This has the potential to rise to 120 million passengers and 1 million flights by 2015.
Austin is fast becoming a global model for forwardthinking cities and has gained the title of Silicon Hills, the Silicon Valley of the south. It’s not hard to see why: its innovative mindset, enterprise-friendly environment, entrepreneurial focus and unique culture have transformed it from a government-dominated economy into a technology leader.
Companies with bases in Austin range from tech titans such as Apple, Google, Facebook, Oracle, Cisco Systems, Dell and Hewlett-Packard through to seed-stage and start-up ventures. This environment, along with the steady flow of graduates from the University of Texas and other nearby schools, plus in-migration that is increasing the population by 150 people a day, is attracting further corporates looking for a young and educated workforce.
A wave of construction is attempting to keep pace with demand, with a focus on both workspaces and co-working environments and high-density multifamily housing.