Savills recently announced the second iteration of Impacts – Savills global thought leadership publication and research programme. This year is the ‘disruption issue’, looking at how widespread economic, political, demographic and technological upheaval is changing the world of real estate. How is the rise in populist politics affecting cross-border investment? Which cities are the most resilient to change in the coming decades? How is technology driving the repurposing of retail assets and the rise of new leisure concepts? Where will our food come from? And what are the forces disrupting the world’s prime residential markets? Impacts answers these questions and more.
From May 2019, Savills Vietnam has been sending out a series of articles around Impacts 2019 themes that are most relevant to our market.
Impacts 2019 series:
NEW WORLD ORDER IN 2028
The world order of top global cities may feel as though it is set in stone. But with disruption on the menu through technology, demographics and leadership, all that is set to change in the next decade.
For traditional leaders such as London, New York and Tokyo, the battle will be about resilience. How can they continue to harness favourable qualities such as strong economies and demographics to maintain their position?
Emerging locations in China and the Middle East are snapping at their heels, challenging the status quo with rising personal wealth and fast-growing economies. They are joining an increasingly crowded field. In the past decade, the number of cities with gross domestic product (GDP) of more than $50 billion has grown from 177 to 248, under scoring the vital role that cities will continue to play in these disruptive times. By 2028, this number is expected to jump to 317. Those cities with GDP over $50 billion accounted for 83% of global GDP in 2018, an increase from 79% a decade ago. This is forecast to increase to 89% over the next 10 years as the importance of cities continues to accelerate.
Their geographical distribution has shifted significantly over the past decade, too, and is expected to change again. In 2018, Asia-Pacific had the largest share of cities with GDP over $50 billion, overtaking the Americas. By 2028, more than half of these influential cities are expected to be in this region.
A second threat to the traditional order is cities working together. The creation of mega-regions has seen cross-border collaboration in the US and Mexico and across Europe. China can do this all on its own by linking populous metropolises.