Indian cities dominated the ‘short term momentum ranking’ in JLL’s latest annual global report ‘City Momentum Index’ (CMI) 2018 with Hyderabad and Bangalore occupying the top two positions. Pune has been ranked at fourth, followed by Kolkata (5th) and Delhi (8th) in the top 10 cities out of the 30 top global short-term growth cities.
“Chennai (14th) and Mumbai (20th) completed India’s stellar show on the annual rankings,” JLL said in the report.
JLL said CMI’s short-term momentum rankings identify urban economies and real estate markets, which are currently undergoing the most rapid growth.
Indian cities performed extremely well on key parameters of human resource, connectivity, real estate investments, property prices, economic output, corporate activities, construction and retail sales.
“India maintained it’s pre-eminence in the Short-Term Momentum rankings as these cities registered among the highest rates of demographic and economic growth globally, while also benefiting from government efforts to boost business attractiveness and invest in infrastructure,” the report said.
While Indian cities have performed exceedingly well in the short-term momentum index, it will be a delight to see them become long-term investment destinations in the future, JLL India CEO and Country Head Ramesh Nair said.
While economic energy is propelling India's cities forward, the consultant said that many of these cities also face challenges like strains on infrastructure and local amenities, high levels of economic disparity and affordability issues and environmental degradation.
In order to maintain their growth over the longer term, these cities will need to focus on future-proofing their markets through improved liveability and affordability, regulatory transparency and physical and technological infrastructure.
“The need to take into account a city's future-proofing capabilities is increasingly recognised by real estate investors, developers and corporations. For investors, it is imperative to comprehend which cities will be able to gain from transformations for long-term value preservation and growth,” Nair said.
Hyderabad and Bangalore, have been leading India's prowess in the global IT/ ITeS and BPM domain.
Bangalore remains the largest Grade A office market in terms of leasing activities. Apart from being a major outsourcing location for multinational corporations, it is also home to research and development facilities for a growing number of global companies.
However, in recent quarters, Hyderabad has picked pace on account of favourable government policies that have had positive impact on the office market in the city.
Global brands like Deloitte, Qualcomm and Microsoft, to name a few, have established themselves in the market.
Another trend seen in the report was the relatively lower positions of tier 1 markets of Delhi and Mumbai, which were at position 8th and 20th respectively.
However, JLL said Delhi and Mumbai are stable markets, with great investment and growth potential.
“Despite concerns on parameters like sustainability, ecological and infrastructural development etc, these locations, on account of their size, demand and rental and capital values, may be one of the firsts to move towards the long-term investment quadrant in the future,” the report said.