Savills names 8 rising global tech cities

Eindhoven, Manchester, Tallinn and Vilnius have been named Europe’s rising stars in the global tech city big league, according to research by Savills.

The rising global contenders highlighted in the Savills Tech Cities report were:

US: Detroit

Devastated by the GFC and the near-collapse of the American auto industry, Detroit is reinventing itself from ‘motor city’ to ‘mobility city’. Detroit is now focussing its attentions on mobility technologies and ushering in a new age of personal mobility. From partnerships between Fiat-Chrysler and Google to GM and Lyft to Ford’s Smart Mobility division and its partnership with EV start-up Rivian, tech is now at the heart of its auto industry. With some of the lowest costs of living of major cities in the United States, Detroit is well placed to offer mobility-tech workers better quality of life and value for money than the major East or West Coast cities.

Asia: Pacific Yokohama

One of the first Japanese ports to open to foreign trade in the mid-nineteenth century, Yokohama has been a centre of shipping and trade in Japan for 150 years. In recent years the city has attracted international investment and company relocations because of the accessibility to Tokyo and other industry centres and its highly skilled workforce. Yokohama is establishing itself as an R&D centre in the Asia Pacific region with Apple, Lenovo, Samsung, Huawei, and LG all establishing R&D operations in the city. While shipping and trade will still play a major role in Yokohama’s economy, the shift to technology and development will only boost the city’s global profile. Yokohama offers residents a lower cost of living than neighbouring Tokyo, but with more space, making it an attractive alternative to the pricier districts of Tokyo.

South America: Bogotá

Rising over 200 places in the global VC rankings in the last four years, Bogotá is the fastest growing city of all the Savills Tech Cities. The Colombian government has been investing heavily in the tech industry by providing training programmes for workers and tax incentives for companies. iNNPulsa and Apps.co, both government initiatives, promote business development in Colombia and provide digital entrepreneurs with resources to increase their chances for success. Bogotá’s strategic geographic position has helped it become a strategic tech hub for the region. A 2019 EY report found that Columbia has the highest fintech adoption rate in Latin America, with 76% of the population using some form of fintech service. This vibrant, walkable city offers residents good access to parks, pedestrianised streets and squares.

Africa: Cape Town

Cape Town is home to several of South Africa’s largest financial institutions, and fintech start-ups are taking advantage of the mature financial ecosystem in the city to scale up and gain notice. Fintech companies are not the only start-ups in the city. According to Invest Cape Town, almost 60% of South Africa’s start-ups are located in Cape Town. VC investment in the city is booming too; from 2016 to 2019, VC investment grew by 147%. A stunning setting at the foot of Table Mountain, low cost of living compared to other tech cities, and inexpensive flex-working space provide Cape Town with ample assets for continued growth in the coming years.

Europe:

Tallin

While many governments worldwide struggle with technology and its ever-growing role in people’s lives, 99% of Estonia’s public services are available online. In 2014, the country pioneered e-Residency permits, which allow individuals to start businesses in Estonia without physically living there. Building on this, Estonia has recently launched a digital nomad visa that will allow remote workers to live and work in Estonia for up to a year. Tech drives not only the national economy but also that of the capital, Tallinn. Tallinn is home to Cooperative Cyber Defence Centre of Excellence (CCD COE) of NATO, the EU IT agency (eu-LISA) and other tech giants. This complete integration of tech with government and daily life provides an excellent environment for businesses and individuals in the tech industry.

Vilnius

A leader in cybersecurity, software engineering, and fintech, Vilnius is another Baltic city with hefty tech credentials. Lithuania has over 1,000 start-ups and 200 fintech companies, all of which are driving investment and growth in the country. E-money start-up Revolut and Google Payments both have offices in Vilnius. Europe’s first Blockchain Centre opened in Vilnius in 2019. The centre is part of a global network of co-working spaces that are being developed to serve as knowledge-hubs for the blockchain industry. Similar to Estonia, Lithuania has initiated a ‘start-up visa’ that makes it easier to attract and retain top tech talent from non-EU countries.

Eindhoven

The location of Brainport, a region in which companies, governments and educational institutions can collaborate on projects, Eindhoven is a centre of tech and innovation in the Netherlands. Some 8 million people are within a 60 minute drive of the city. ASML, Philips and VDL call it home. Eindhoven is also the location of the High Tech Campus which bills itself as ‘the smartest km2 in Europe’. This campus houses over 220 companies and 12,000 researchers. Lower cost of living than Amsterdam and higher quality of life scores will continue to draw talent and businesses to the city. The Dutch have the most bicycles per head than any other country, and Eindhoven, in particular, is a cyclist’s paradise with dedicated cycle lanes and an elevated cycle roundabout called the Hovenring. The openness to tech has boosted Eindhoven’s economic growth and international reputation.

Manchester

Whilst a great deal of Manchester’s international profile comes from football, nearly everyone on earth can recognise a Manchester United shirt, it isn’t the city’s only claim to fame. Manchester has a thriving community of more than 10,000 digital and tech businesses, from start-ups to global companies like Google, Microsoft, IBM and Cisco. Manchester has a strong knowledge economy with three internationally ranked universities, providing highly skilled workers for the tech industry but also allows academics and enterprises to work together on projects. The University of Manchester, in particular, is spearheading the development of graphene for industrial and medical use. This forward-thinking city has set an ambitious zero carbon target of 2038, 12 years ahead of the national target, and is planning a 1,800 mile cycle and walking network across the Greater Manchester area.

Savills Tech Cities, which has run since 2015, previously ranked the best cities globally for tech occupiers and talent. However, given the events of 2020 and the move towards different types of city appealing to different types of occupier, for its 2021 programme the firm has grouped them by tiers instead. This includes a selection of ‘Rising Global Contenders’.

Savills notes that the Rising Global Tech Contenders are the cities to watch in the fast-paced world of tech, characterised by huge leaps in venture capital investment in recent years, with economic growth being fuelled by burgeoning tech sectors. On a global stage, they also offer cost and lifestyle advantages for tech talent and occupiers over their established peers such as London, San Francisco and Beijing.

James Evans, head of Savills Manchester, commented: “We’ve seen a substantial increase in the demand from growing tech occupiers in Manchester over recent years, from start-ups to global companies like Amazon, Booking.com and HPE. With three internationally ranked universities and strong graduate retention rates, Manchester is well-placed to continue to capitalise on thriving tech talent, and with the development of neighbourhoods such as Bruntwood SciTech’s Circle Square, the city is well and truly beginning to make its mark on the global tech scene.”

Paul Tostevin, director and Tech Cities programme lead, Savills World Research, added: “In spite of 2020’s upheavals, a raft of rising tech contender cities are emerging, driven by strong higher education sectors, vibrant neighbourhoods and a good balance of sustainable city living with good regional and international connectivity. What’s more, with many people reassessing their working lives as a result of the events of this year, the appeal of these cities in a post-pandemic world may be a further indicator of future growth.”

For the full research report visit: https://www.savills.com/landing-pages/tech-cities.aspx