Saturday 25 February 2017

Brexit may force UK tech firms to move here

Peter Flanagan

Peter Flanagan

Skyscrapers in the Canary Wharf business, financial and shopping district, including HSBC Holdings Plc, center left, One Canada Square, center, and Citigroup Inc., are seen in this aerial photograph.
Skyscrapers in the Canary Wharf business, financial and shopping district, including HSBC Holdings Plc, center left, One Canada Square, center, and Citigroup Inc., are seen in this aerial photograph.

Dublin's commercial property sector could see an influx of technology firms from London if the UK votes to leave the European Union, but the predicted transfer of finance jobs is unlikely to take place, a new report has found.

Data from CBRE, which looks at the potential impact of a so called "Brexit" on the European commercial real estate market, shows that Dublin's tech industry could be one of the main beneficiaries if companies decide to shift operations to another EU country.

"London, with its Tech City and Silicon Roundabout is the tech start-up capital of Europe but it is not without competition.

"London does not just compete in aggregate size, however, but in the focus of jobs and companies on new applications based technologies, a beneficial mix of an entrepreneurial climate, and an established venture capital industry and an attractive environment for a very cosmopolitan workforce.

"The main competitors are not necessarily the biggest and the cities most often cited as competitors are Berlin, Dublin, Stockholm and Amsterdam," CBRE say.

With that in mind, the firm believe Dublin is in a position to capitalise on any sense that the companies may wish to move to within the EU.

The IDA has already made clear it is trying to tempt financial companies to relocate to Ireland in the event of a Brexit and CBRE believe the fintech sector in particular may see significant movement towards Dublin and other cities around the continent.

"To some extent this has developed because of the available pool of talent and finance that comes with being part of a bigger digital tech cluster, but proximity to one of the world's biggest financial services centres is also likely to play a part.

"However, the implication is that if London loses banking jobs to competing centres then fintech jobs could go too.

"Frankfurt is not a major digitaltechnology centre so if a Brexit is followed by a substantial re-location of financial services jobs to Paris it would also give a shot in the arm to the city's growing digital tech industries.

"Some of the second-tier financial centres such as Amsterdam or Dublin might be well placed to pick up these jobs," CBRE adds.

"While much of the hype around firms moving to Dublin after a Brexit has been focused on finance and the CIty of London, CBRE see little appetite among bankers to move to Ireland.

Frankfurt and Paris are the most mentioned likely destinations if international financial services jobs leave London. Milan and Madrid actually have more financial services jobs than Frankfurt but Frankfurt is seen as more internationally orientated.

"Lending and trading are more important in Frankfurt than in other European cities, London excepted. A number of UK-based banks have already said that they have contingency plans to re-locate some of their staff out of London in the event of a "leave" vote.

"HSBC have said that they have contingency plans to move 1,000 investment bankers to Paris.

"JPMorgan, Bank of America Merrill Lynch and Goldman Sachs have also talked about relocations but have been less specific about the location. Dublin and Amsterdam could come into the reckoning too," the report states.

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