The Scottish estate market has entered a new era, where newly perceived attributes are attracting buyers looking to fulfil their environmental, social and corporate governance (ESG) objectives, according to Savills
Analysis of the firm’s sales data demonstrates a 98 per cent increase in buyers registering with the agency to purchase rural property in Scotland last year.
Lockdown continues to amplify this trend, despite the fact that international buyers’ opportunities to view Scottish property are severely limited due to travel restrictions.
As a result, about 70 per cent of Savills’ Scottish estate buyers last year were based in the UK, although the interest generated was global.
The market is rarefied. Of the country’s rural estates – defined as a land holding that includes a mixture of asset or enterprise types, such as residential, farming or forestry – only 23 changed hands last year.
While this in line with the long-term average, the total value of Scottish estates sold in 2020 increased by 43 per cent to £100 million, in part as a result of stronger demand from ESG buyers.
The beauty of Scottish estates continues to attract residential and amenity buyers and this was particularly apparent last year, with more buyers being drawn to the great outdoors during the pandemic.
However, Evelyn Channing, Savills’ head of rural agency in Scotland, says a new surge in interest in the country’s larger estates can be explained by two key purchasing drivers – natural capital and forestry.
She explains: “New entrants wishing to buy land not for its amenity or sporting potential, but for its green credentials, are becoming more prevalent.
“The ESG agenda is bringing buyers forward of all shapes and sizes, from small Scottish businesses, local communities, large charities, investment companies, and partnerships comprising a combination of these.”
William Hawes, Savills’ head of natural capital in Scotland, adds: “We are working with existing Scottish landowners and communities keen to play their part in the global environmental challenge as well as social issues closer to home.
“We are now working with an increasing number of new buyers who are interested in buying estates for the same reasons.”
In particular, the continued focus on the climate crisis and the drive for net-zero is fuelling demand for land suitable for planting trees. Other buyers are looking to offset carbon emissions produced elsewhere by purchasing natural capital.
According to Savills, the investment focus has largely been on arable land and established forests, but also on the peat bogs which cover a large expanse of Scotland and until recently have largely been regarded as having minimal value.
Channing says: “Scotland is one of the few remaining places in the world where green resources can be acquired on a meaningful scale. There is a lot of focus on addressing the climate crisis both at an individual level and from a national response.
“Scottish estates have an expanding role to play and we anticipate significant diverse interest in the estates that we will be bringing forward to the market over the next 24 months.”
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