Frankfurt is favourite for Brexit jobs while Dublin comes a distant second
A survey published by Ernst & Young last Monday suggests Frankfurt will see the biggest influx of employers from the City of London following the UK's decision to vote in favour of leaving the European Union.
More than 70pc of the survey's respondents favoured the German city over Dublin, Paris and Amsterdam, all three of which have been mooted as potential hosts for the 100,000 financial services jobs which it is estimated could be lost by the UK because of Brexit.
After Frankfurt, Dublin emerged as the second choice with 13pc of the EY survey's respondents favouring our capital city. Paris emerged as the third preference of those surveyed, with 6pc of respondents giving the French capital their vote.
EY surveyed 555 German market participants following the UK's referendum, which took place on June 23. About 40pc of respondents said they're still unable to evaluate the impact.
"The German real estate market and the city of Frankfurt will be among the biggest beneficiaries of the Brexit vote," EY wrote in a statement on Monday describing the survey results.
Property investment volumes, prices and rents across Germany will all rise as a result, with Frankfurt emerging as the biggest beneficiary, the statement added.
Commentators here have expressed mixed views in relation to the degree to which Dublin and other major Irish cities stand to benefit from the potential inflow of companies and employment from London and elsewhere in the UK as a result of Brexit,
In an interview with the Irish Independent last week, Jones Lang LaSalle managing director John Moran summed up that uncertainty, saying there was a danger that potential gains from Brexit could be "overplayed".
In terms of the potential benefits for Frankfurt, however, the Viennese-headquartered real estate company CA Immobilien Anlagen AG believes it will boost the German city's commercial real estate prices, accelerating a trend that has already pushed building values to record highs.
"We've been in a clear upward spiral, and even without Brexit there's a lack of supply on the investment side," Frank Nickel, CA Immo's chief executive officer, said in an interview.
The company is one of Frankfurt's biggest developers, with properties including Tower 185 and the Skyline Plaza mall.
Banks with operations in London are widely anticipated to move at least some of their staff to mainland European cities such as Frankfurt, Dublin, Paris or Amsterdam to counter the risk of losing unfettered access to the single market as the UK prepares to disentangle itself from the EU. As many as 100,000 financial-services jobs could be lost in the UK by 2020 because of Brexit, according to an estimate by PricewaterhouseCoopers LLP.
If those jobs end up in mainland Europe - as firms move functions including securities clearing and derivatives trading to the EU - demand for new office space could reach 1 million square metres (10.8m sq ft), Capital Economics estimates.
Yields for Frankfurt's most desirable offices fell to 4.3pc at the end of 2015, 20 basis points lower than a year earlier, according to data compiled by BNP Paribas Real Estate. Yields, which measure returns from property investment, move in the opposite direction of prices.
"Investors will pull back from the UK a little bit now and choose options in Continental Europe instead," Nickel said. (Bloomberg)