NY Times Ranks Amsterdam Number One After Brexit

The race is on to be the new London.

Unless Britain finds a way to undo its decision to leave the European Union, London’s days as the pre-eminent global financial capital, ranked even ahead of New York, may be numbered.

I spoke this week to several high-ranking executives at major financial institutions that collectively employ tens of thousands in London. While none of them have any immediate plans to move their European headquarters from Britain’s capital, all agreed they would eventually shift a significant number of highly paid employees to cities that remain in the European Union.

One executive in charge of relocation (who like the others, spoke only on condition of anonymity because of the political sensitivity of the issue) said the percentage of employees in his firm who might be required to move ranged from 10 percent to 40 percent. “Multiply that throughout the industry and it’s tens of thousands of people and their families,” he said. “And bear in mind that most of these people are millionaires.”

Others said it would take five to 10 years, but a new London would almost certainly emerge in one of the other prominent cities of the European Union. “When I moved to London years ago, it wasn’t exactly cosmopolitan,” said another executive. “It wasn’t a place for great restaurants. The infrastructure has improved dramatically. It will take time, but eventually one big hub will develop.”

Who might win this high-stakes financial sweepstakes?

To handicap the race, I asked relocation experts at major firms to describe what they are looking for in a replacement for London. I also spoke to Mark Yeandle, a director of the Z/Yen Group in London and lead author of the Global Financial Centers Index, which ranks cities based on their attractiveness to financial services businesses. (Before last week’s vote, London was far and away the winner.)

Here are the criteria most frequently mentioned: English-language facility, which is essential for attracting a global work force; a favorable regulatory environment, especially regarding employment; excellent transportation and communications infrastructure; availability of prime office space and luxury housing; good schools; good restaurants and cultural offerings; and finally, an intangible quality that includes a certain energy level and openness to an influx of highly paid, competitive City of London-Wall Street types.

I scored numerous cities in the European Union on a 60-point scale: five points for office space and housing, five points for restaurants and cultural offerings — because it’s easier for any city to build new offices and housing, and import talented chefs and entertainers — and 10 points for each of the others.

For English-language facility, I used the European Union’s 2012 survey, “Europeans and Their Languages.” For the regulatory environment, I used the rankings from the World Bank. For airports, I combined on-time departure statistics with a leading passenger satisfaction survey.

To evaluate schools, I consulted Harriet Plyler, editor of “The Good Schools Guide International,” and the Pearson Learning Curve Index. For restaurants, culture and quality of life, I used Mercer Consulting’s Quality of Living Survey and a ranking of cities based on the number of Michelin-starred restaurants; for cost and availability of offices and luxury housing I used the Global Property Guide.

And the winner is:

Amsterdam (55 points)

Not only do 90 percent of the Dutch speak English, many speak it better than the English themselves. Its schools are ranked the best in Europe, and there are plenty of English-language options. The city has beautiful architecture and housing options, picturesque canals, excellent restaurants, music and theater, lively night life, and a cosmopolitan and tolerant attitude cultivated over centuries as a major global trading center.

It has one of Europe’s best airports, ranked just behind Frankfurt and Vienna, and an excellent rail network connecting major European capitals, including London. It’s a short train ride to Brussels, the capital of the European Union.

Amsterdam is already a center of international commerce and the financial and political capital of the Netherlands. It did lose a few points for its business and regulatory climate: The World Bank ranks the Netherlands 28th, just behind Switzerland and France.

The problem? Badly hurt by the financial crisis, the Dutch have capped bankers’ bonuses at just 20 percent of their annual salaries — a far more drastic curb than was imposed by the European Union. Several bankers told me that unless the Dutch repealed the cap, they wouldn’t consider moving to Amsterdam. “I’d love to relocate to Amsterdam,” one top executive told me. “But I don’t think we’re wanted there.”

Out of curiosity, I examined the same criteria and scored London itself. The result?

London earns a near-perfect 58 points. The only black mark was its quality of life, primarily because of its high cost. Mercer ranks London just 39th (New York ranks 44th).

“London has so many advantages,” Mr. Yeandle said. “I think that will remain true even if it’s outside the E.U. But if the vote costs London its pre-eminence, that will be a self-inflicted tragedy.”

source: http://www.nytimes.com/2016/07/01/business/after-brexit-finding-a-new-london-for-the-financial-world-to-call-home.html?_r=0