WHY IS NEW YORK REAL ESTATE DOING SO WELL?

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Posted by Leonard Steinberg on March 12th 2012

Everyone keeps asking and e-mailing why on earth I keep posting all these blurbs about how the real estate market is doing so well right now….in March’s LUXURYLETTER I called New York MULTIPLE BID CITY…. Last night I received e-mails about an article talking about how bad bonus season was and how poorly those in the financial markets are doing (which is definitely not true for all!). Maybe one reason is that when it comes to being competitive, New York is No. 1!

New York emerged on top again in a new survey of the 120 most economically competitive cities in the world. London came in second, followed by Singapore, with Paris and Hong Kong tied for fourth.

Leo Abruzzese, of the Economist Intelligence Unit, which conducted the survey on behalf of Citigroup, said New York’s strengths extended beyond its powerhouse financial sector to its long-established infrastructure, social and cultural amenities, record number of tourists and improving educational system. “This is not just about having the fastest growth rate,” said Abruzzese. “If it was, the index would be dominated almost entirely by cities in Asia, cities in China. One of the conclusions we came to was for a city to be competitive, it does need to have a strong economy, but it needs to have other dimensions as well.” Not only does New York have an economic, diversified powerhouse, it also has the soul and culture that makes a city great.

Bloomberg has pushed for investment in many of the same areas where the city scored big points in the study. his focus on the tech sector is bound to produce strong results years from now, and the effects are being felt already.

The two categories where the city fell short were both well beyond the mayor’s control — a talent pool constricted by national immigration policies, and a potential “environmental hazard” in the form of rising water levels that could one day endanger Manhattan.

Bloomberg was naturally very pleased with this survey, but like the smart businessman he is, he cautioned that the city had to maintain its momentum. “The instant you let down your guard or stop innovating, you will see a change in the big mo, and changing the big mo is hard to do,” he said.

Dominance of Western cities will be challenged by Asian cities in coming years, according to Abruzzese. Till then, we may have discovered an important answer to an on-going debate….