Commercial occupier demand intensifies in Edinburgh and Glasgow
The surge has been driven by strong city centre take-up in Edinburgh, with both Glasgow and the capital showing impressive growth in out-of-town demand.
The half-yearly ‘Big Nine’ research from Bilfinger GVA reflects strengthened confidence in the market, particularly in Edinburgh where city centre take-up of 170,277 sq ft is well above the 150,421 sq ft five-year quarterly average.
Out-of-town demand was also high with 44,872 sq ft recorded for Q2 compared with the quarterly average of 39,288 sq ft. Glasgow’s out of town figure of 95,831 sq ft was also well above the average 75,799 sq ft, reflecting the recent successes of peripheral locations such as Finnieston and Clyde Gateway.
Glasgow’s city centre take up at 109,773 sq ft was below the five year quarterly average of 132,210 sq ft, but showed an increase on the same quarter last year.
Alastair Cumming, associate director of GVA James Barr, said: “The first half of 2015 has been positive for the Glasgow office market, demand for Grade A space is at its highest since before the recession with a number of large corporates circling the remaining space in Glasgow’s three new build developments which have now all reached practical completion. The current total Grade A requirement in the city is in excess of 300,000 sq ft.
“This means some companies might be disappointed as the long-standing occupier friendly market evaporates in favour of the landlords.”
Peter Fraser, associate director GVA James Barr, added that there is a similar tightening of supply in Edinburgh’s city centre as many offices are converting to other uses.
“The supply of larger floorplates is becoming sparse as various speculative schemes under construction are gaining interest. Marketing for pre-lets is actively underway at New Waverley with construction progressing on the new Quartermile and Haymarket sites. Out-of-town there is currently renewed interest in business parks to the west of Edinburgh.”