Innovation Cities

From hippies to hipsters, the world’s most dynamic city

San Francisco has been crowned the most dynamic city globally, according to a new ranking published by real estate services firm Jones Lang LaSalle (JLL) on Friday.

The company's City Momentum Index looks at the underlying drivers of highly dynamic cities including the presence of corporate headquarters, top universities and technology and venture capital firms.

(Read more: Think big: Is this the future of urban housing?)

The index aims to provide real estate investors with a perspective on city dynamics and captures the signals of change by focusing on the features of a city that are likely to underpin future performance.

Costumed dancers in Carnaval Grand Parade in San Francisco.
Judy Bellah | Lonely Planet Images | Getty Images

"The tech-heavy San Francisco Bay Area is the undoubted winner of our first City Momentum Index, providing a unique and unrivalled reputation for innovation, venture capital and start-ups. Indicative of the metro area's current dynamism," JLL wrote in a report.

San Francisco is expected to show the strongest rate of office rental growth in North America during 2014, according to the firm.

The top 10 cities were scattered across the globe with London, Dubai, Shanghai, Wuhan, ranking second through fifth, respectively.

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Dubai has bounced back from a slump in its economy and real estate market following the global financial crisis, with the city's successful bid to host the 2020 World Expo trade convention also providing renewed confidence.

Meanwhile, the less-talked-about city of Wuhan has built robust momentum as it realizes its potential as the hub of Central China. An industrial powerhouse of global scale, the city is climbing the value chain, helped by one of the country's strongest education infrastructures, JLL said.

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New York, Austin, Hong Kong, San Jose and Singapore rounded out the top ten in sixth to tenth place, respectively.

"The true foundation of highly dynamic cities emerges from such factors as speed of innovation and creation of cutting-edge businesses along with new building construction, property price movement and investment in real estate from cross-border investors and corporations," said Jeremy Kelly, director, global research at JLL.

A city to watch

One city to watch in the United States is Boston, the firm said, which made it into the top 20, ranking in 17th place.

(Read more: The next city aiming to become a high-tech boomtown)

"As the world's top education hub and with a proven ability to leverage talent for commercial innovation, it is a magnet for major international technology companies," JLL said.

"The city has a strong and diverse economy and is addressing key points around affordability and inclusion," it added.

—By CNBC's Ansuya Harjani. Follow her on Twitter @Ansuya_H