Los Angeles has been named as the top global city for the second time in the fourth publication of the Schroders Global Cities 30 index.

LA narrowly beat Hong Kong which took second place, knocking London into third.

The Schroders Global Cities 30 index is compiled on a range of factors, including the projected growth of the economy, university rankings, disposable incomes over the next decade and demographic measures.

US cities

US cities continued to dominate the index taking 17 of the top 30 places, including five of the top ten spots. New York, the most populous city in the US, jumped one place from fifth to fourth. However, Boston and Chicago both fell from third place to sixth and fourth place to seventh, respectively.

US cities have been in the spotlight recently as Amazon looks to find the best city to host "HQ2", its second headquarters in North America. Twenty cities have been shortlisted by Amazon and of those, eleven feature in the Schroders Global Cities 30 index.

Chinese cities

Chinese cities saw the most improvement, taking four of the top 30 places, including two in the top ten. Shanghai jumped from tenth spot to fifth, Beijing climbed from 11th place to fourth and Shenzhen increased its place in the index from 24th to 20th.

Australian cities

Australian cities struggled to maintain their positions in the index and were among some of the biggest fallers. Negative revision to population growth and GDP affected Brisbane and Perth in particular. Perth dropped 15 places from 36th to 51st whilst Brisbane fell from 22nd to 30th.

Melbourne lost its spot in the top ten, falling from 8th to 16th. Sydney was the only Australian city to improve its ranking, climbing from 14th place to take the tenth spot in the index.

• Read more: Could Melbourne's house price boom derail its global city status?

European cities

London was once again the top ranked European city, despite falling by one place to third place in the overall index. Paris, the only other European city to feature in the top 30, climbed one place from 16th to 15th.

• Read more:: Why Paris is on the up: tourism, transport and Brexit. 

Why the rankings have changed

The Schroders Global Cities 30 index looks at scale and growth of a city. We believe that cities with scale have a structural advantage. However, the model also captures fast growing cities. This means the ideal city would be medium sized with identifiable economic growth.

It’s no surprise that Los Angeles has reclaimed its place at the top. This is due to a combination of large scale and excellent economic growth. The scale and economic depth of LA makes it a compelling location to work and live.

Chinese cities continue to do well in the index with Shanghai and Beijing taking top ten spots. It remains clear that the increasing wealth generated in leading Chinese cities is being reflected in the index.

• Rising global cities: ones to watch in 2018

The scale and growth of Chinese cities is supportive of their high ranking. Shanghai, Beijing and Shenzhen all moved up the index on the basis of small improvements in the income factor. This improvement shows that the populations of the major Chinese cities are growing wealthier, as the Chinese economy transitions from manufacturing to consumption.

Australian cities generally fared quite poorly. On the positive side, Sydney continues to do well. This further supports our view that employers focus on locations with the best educated workforce and transport infrastructure to compete in the knowledge economy.

London has slipped from second place to third. This is due to a slightly lower score on the university section of the ranking. We have made no negative revisions for London due to a perceived loss of growth from the vote to leave the EU. London remains one of our favoured places to invest.

Our aim in devising the index is to identify the cities in which to invest – those with restrictions to sprawl, be it geographical limits or planning rules, such as London’s green-belt, represent the most compelling opportunities.

Our global cities team launched the Global Cities blog in 2016, which acts as a resource to track the longer term trends impacting global real estate.

For further reading please visit the Global Cities website.

Global Cities Index