di Thomas Beyerle
Moscow as an international financial
centre is a topic often discussed at real
estate conventions, congresses, exhibitions.
However, with Moscow is associated
a lot, but nearly nobody has in mind
a business district like Canary Wharf in
London or La Defense in Paris—pictures
that arise automatically in front of the inner
eyes of everybody hearing the names
of the two cities. But it is not only the
struggle against an established image
blocking Moscow’s development into one
of the big financial centres of the world.
Let’s be honest: which pictures arise in
front of your inner eyes when you have
to describe Moscow? Kremlin and the
Red Square, Saint Basil’s cathedral, the
Cathedral of Christ the Saviour, the department
store GUM—and endless traffic
congestions. These associations are
strongly linked with the city on Moskva
River, mainly in those who are dealing
with the capital city of the Russian Federation
in some way. The pictures reflect
tourist highlights and an infrastructure that
is hardly able to keep up with the city’s
When asked about the Russian capital
city only few will associate the skyline
of the new business district Moscow-City
with meanwhile 12 skyscrapers. Among
the ten tallest buildings in Europe seven
are located in Moscow, and all these
seven skyscrapers are part of Moscow
International Business Center (MIBC)
Moscow-City, the biggest urban development
in Europe at the start of the millennium.
The names of these skyscrapers?
The answer to this question is mostly silence.
And who is able to describe the
skyline of Moscow-City? Rather nobody.
This little test shows that pictures, associations
or perhaps preconceptions are
changing only very slowly. That during the
last 20 years there has been a construction
boom in Moscow seems to be comprehensible.
However, has there been
some kind of communication strategy?
Whether in China, USA or Western
Europe, everywhere spectacular buildings
are showcased prominently. The
most recent example is The Shard in London.
Spectacular buildings are (nearly)
always architectural masterpieces, mostly
spectacularly high but as well they often
have spectacular vacancies. But who has
already heard about Mercury City Tower
or Federation (Federazija) Tower with its
twin towers named Wostok and Sapad?
What are they representing? And what is
At this point the answer to the question
what is happening in these buildings is:
“something with banks”. That is true in
Moscow as in nearly every part of the
world. Because most capital cities are
also the commercial and financial centre
of the respective country—a fact generally
known. However, least of all are
linking the concept of a financial centre
with Moscow. The reason for that is—
strictly spoken—nearly not to express in
facts and figures. At first glance the capital
city of Russia is meeting the requirements
of an international financial centre.
But to become an international banking
and financial centre there is more to offer
than office space, achievement-oriented
people and high salaries.
But what exactly are the characteristics of
an international financing centre? Some
basic parameters are: The respective city
is headquarters of the national stock exchange
and the national bank, and it is
the network hub of international policies.
An international financial centre also has
to offer extraordinary cultural life and a
well-developed, extensive transport infrastructure
including international airports.
And the respective city should have a distinctive
This nearly monocentric definition of an
international financial centre is mainly
about the ‘hard facts’. Nevertheless there
are still other requirements, more ‘soft
facts’ that are complementing and more
and more replacing the ‘hard facts’.
‘Soft’ are these facts called because they
are difficult to measure and furthermore
hardly to change at least in the short or
medium term. When cities almost everywhere
are offering the same quantity and
quality of ‘hard facts’ like office space,
sufficient labour force or ‘affordable’
rents, then international centres and especially
financial centres differ by aspects
as diversity, speciality and connectivity.
Looking at the international selection of
business locations or at international job
postings these three requirements can always
be found albeit in a more simple
translation: diversity means a widespread
economic structure with a business climate
that is characterized e.g. by low
density of regulations and low bureaucracy
and/or a low grade of corruption.
Speciality includes very diversified and
intensive business activities in general
and/or a special focus on a certain business,
for example on foreign exchange
trading. And connectivity is the short term
for the network connecting with other financial
centres and offering a high amount
of communication opportunities.
This outline of an international financial
centre is accompanied by other requirements
that are measurable, but seem to
have no direct context at the first glance.
These requirements are international
schools and kindergartens, leisure and
sport facilities, low crime rates and last
but not least a very open-minded atmosphere
in general. There is to discuss if
and how far all these requirements are
really fulfilled in the one or other financial
centre. However, it is fact that nearly no
international manager will go to a country
or city where everyday life for his family
is not really running. Even a very high
salary is no compensation for these deficits.
That might be one of the reasons why
Dubai and Abu Dhabi are still on their
way to become an internationally important
real estate and financial centre. At
least there the realisation of the project is
not a question of money. That might also
give Moscow a hint what is still to optimise
to be promoted to the first league.
Moscow definitely fulfils the qualifications
of an international financial centre. Although
Russian economy is still depending
on commodity markets most of the
international companies have established
an office in Moscow and especially in
Moscow-City, because MIBC is exactly
the kind of business location international
companies are familiar with at home.
Furthermore international companies
are well aware of the fact that the most
spectacular office or shopping centre locations
is standing or falling with the transport
infrastructure offering good access.
In this point a still closer cooperation of
developers and the city’s planning authorities
could be helpful, especially because
so far only 40 percent of the whole area
dedicated to MIBC Moscow-City project
are already developed. That offers
inconceivable opportunities given the
fact that Moscow-City is an inner-city
district and not a business district located—
like in many other cities—far away
from the city centre. An example of an
international business district relatively
far away from the inner city is Canary
Wharf in London. A counter-example is
La Defense in Paris, with which MIBC
Moscow-City is comparable.
Looking at the real estate market fundamentals
the schizo of the current situation
in Moscow is becoming evident. While
the development of rents, lettings and
vacancies is corresponding to other capital
cities, there is still to bridge a broad
gap regarding modern office stock. Moscow
is offering half of the office area
of Frankfurt am Main, it has a quarter of
Paris office stock or only 20 percent of
the modern office area located in New
York. Therefore it will be still a long
road: There have to be more constructions
cranes rotating in the sky and at
least there has to be a global communication
strategy to bring Moscow and
its skyline on the front pages all over the
world and to promote the city to the first
league of global capital, real estate and
(Courtesy of SPH –Schiller Publishing House )