Publications

- April 1, 2018: Vol. 10, Number 4

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Performance of global gateway cities, 2007–2016

by Jennifer Molloy

Since the global financial crisis, property investors have sought the perceived safety of portfolio diversity and capital growth in global gateway cities, on the premise these economically-dynamic and well-connected cities would provide greater liquidity and more stable cashflows than secondary markets, according to MSCI.

In its February report, Global Gateway Cities: The Performance Behind the Hype, MCSI found the office sector in global gateway cities “did not provide superior unadjusted returns over the decade ending 2016, based on annualised total returns.” From 2007 to 2016, for example, 10-year annualised total returns for standing office investments in the global gateway cities of London, Paris, New York City and Tokyo all underperformed “regional gateway cities” (Toronto, Sydney, San Francisco and Seoul), “nationally-significant cities” (Johannesburg, Stockholm, Taipei and Oslo) and “other” cities — including Vancouver, Canada; Australia’s

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