Brexit: Could one of these cities replace London as Europe's financial centre?
It has been argued that the separation of the UK from the European Union, when Government triggers Article 50, could jeopardise London’s position as the financial centre of Europe. But how likely is it that other European cities could take on its mantle?
Uncertainty about the future of the country’s access to the EU market and its workers as well as questions about regulatory changes have already rocked London, with several major banks cautioning that they could move staff members out of the UK.
However, John McFarlane, the chairman of Barclays and of business group TheCityUK, has attempted to quell unease by reinforcing the idea that London is “a highly desirable place to do business” globally.
“Europe’s capital markets are not in Paris, Frankfurt or Dublin – they are in London. This is a genuine competitive advantage that has been built over centuries and is incredibly difficult to replicate or displace,” Mr McFarlane said recently.
Nevertheless, a note from UBS on the European real estate market has pointed to the inevitability of a shift in the framework of the financial services sector following the vote for Leave.
“The assumption that London’s financial and business service sector will be able to keep its access to the EU market for services and capital while restricting free movement of people is quite optimistic in our view,” said Gunnar Herm, head of real estate research and strategy across Europe for UBS.
“In summary, Brexit is a threat for London. Financial services companies may not rush through the door to relocate; however, should uncertainties with the UK’s future relationships with the EU continue for too long, companies may re-assess their options and execute in the interest of their stakeholders.”
UBS identified five European cities where real estate brokerage companies are looking for alternative bases and have weighed up whether each presents a viable threat to London’s dominance.
Mr Herm added that none of the five may be able to replace London completely, which will present "a challenge for the whole of Europe".
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The Irish capital is the city of choice, according to UBS's analysis, which called Dublin a "well-established financial centre" although it has yet to compete with London on either a European or a global scale.
Dublin's allure is based around its close ties with the UK and the US – linguistically as well as economically – and its flexible labour and tax laws. However, Ireland's geographical cosiness with the UK and its relative nearness to the US mean that the Fair City is slightly further away from mainland Europe. And although transport links to Europe's capitals are strong, flight connections to the rest of the world are more limited than from other major cities.
UBS also noted that Ireland's economic recovery has led to a surge in office occupancy, leaving little space – less than 6pc – available in the already small market.
On mainland Europe, Germany's financial district would be an obvious choice to replace London – and has the added global reach that Dublin lacks, UBS said.
Already home to the European Central Bank, the Bundesbank and several global financial services firms such as Deutsche Bank and Commerzbank, the EU's biggest economy is well primed to pick up where London might leave off, despite having stricter labour laws than the UK.
The city is already preparing for an influx of 10,000 or so bankers over the next five years – and those from London can look forward to cheaper living costs and shorter commutes.
Frankfurt also boasts the third-largest airport in the EU, with excellent transport connections across the world, and has an office vacancy rate twice that of Dublin at around 12pc, with half a million square metres of work space available in the city centre.
While Amsterdam might lack Dublin's links to the UK or Frankfurt's central location on the Continent, the Dutch capital boasts Europe's best-developed pension system, according to UBS.
Amsterdam competes closely with Frankfurt on transport links, with Schiphol, the EU's fourth-largest airport, located close to the city, while "market friendly policies and the population's excellent English language skills keep barriers for movement relatively low".
Amsterdam offers similar office vacancy rates to Frankfurt -around 12pc - although the city's "Financial Mile", Zuidas, is growing in popularity and could run out of room fast.
All in all, the Venice of the North presents a viable alternative for Europe's new business centre – with one hiccup. Those in financial services might not like the 20pc cap on bankers' bonuses.
The City of Light is not a favourite to become the new financial hotspot thanks to its reputation for rules and regulations, despite its many major banks and asset management firms.
This is not for want of trying: Valerie Pecresse, head of the Paris regional government, wrote to 4,000 British executives the day after the referendum extolling the business virtues and "unparalleled quality of life" offered by her city.
But UBS said that Paris is held back by its relatively rigid regulatory and legal environment and resistance to speaking English, "the global working language".
However, the French capital is the best-connected city on the shortlist, with Charles de Gaulle, the busiest airport in the EU after London, on its doorstep – and unlike Frankfurt and Amsterdam, Paris is the country's political home as well as its economic centre.
Luxembourg's main drawback is its size. With a national population of roughly half a million people, and only 4m square metres of office space, the district would soon be overrun if London's City workers relocated.
Just 4pc of the office space is currently available, presenting a challenge for arriving companies, and Luxembourg's Findel International Airport can barely compete with the bustling flight links of its neighbouring countries.
However, its convenient location – nestled between Germany and Belgium – places it well to draw from both the financial and political capitals of Europe.