CHICAGO—DTZ Research just published its2015Annual Outlook, and found that US continues tobe the market most favorable for both investors and occupiers. Thecompany examined 60 of the largest occupier markets and 60 of thelargest investment markets, and scored 20 apiece from the Americas,the Asia-Pacific region and EMEA on transaction volumes, relativevalue, market timing and volatility. Seven US cities landed in thetop ten investor market rankings and four of the top five occupiermarkets are located in US. But the firm also expects changes by2017, when Asian and European cities should provide stifferchallenges to American cities for more of the top spots.

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“There is good relative value across most markets, especially inthe US which is why they dominate the list,” said HansVrensen, global head of research. “However, a newgeneration of multi-national corporations are challenging theexisting business establishment and expanding outside their homecities. Based on these occupier market rankings, second-tier citieswill successfully challenge for top ten spots over the next threeyears and occupiers will benefit from increased competition amongcities.”

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It's no surprise that New York andLondon are at the top of the investor marketrankings. However, in addition to more European and Asian retailmarkets competing for the top spots, the firm's researchers expectLondon will switch with New York and occupy the number one positionby 2017. “Asia and Europe provide greater diversity for investorsthan the US, a factor that will play a larger role in the comingyears as macro-economic and market recovery continues to broaden,”the researchers found.

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The company attributes the strong overall performance by UScities in the occupier rankings to the nation's “high scores ineconomic measures including economic diversity, labor productivityand availability of affordable space.” Still,Mumbai beat out all US cities for the top 2014global occupier ranking, and DTZ believes thatShanghai will ascend to the top spot by 2017,followed by Mumbai and then Tianjin. Occupiers,however, don't seem enchanted with cities from the EMEA region,with only Brussels and Dublinmaking the top twenty this time around.

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“The 2017 ranking confirms our expectations that investors willbe able to consider attractive opportunities in a wider range ofsecond tier markets over the next three years,” says Vrensen. “Thiswill be supported by the strong increase in raised capitalavailable to be invested in direct real estate.”

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Brian J. Rogal

Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.