Robust start to the year for key city office markets

Solid demand and a lack of supply has led to a good start to the year for the office markets in Scotland's two biggest cities, new research has shown.

Glasgow's office market enjoyed a strong start to the year, said CBRE. Picture: John Devlin

Take-up in the first quarter in Edinburgh totalled 283,720 square feet – down 19 per cent from the final quarter of 2015 but up 17 per cent compared to the same period a year earlier.

The market was boosted by Edinburgh Napier University’s deal to acquire 107,514sq ft of space across three buildings at South Gyle Business Park, further diminishing the already low level of out-of-town supply, the latest office market research by property consultancy CBRE reveals.

Stewart Taylor, senior director in CBRE’s national office agency team in Edinburgh, said: “With only two speculative schemes under construction totalling 110,500sq ft, completion dates for other proposed schemes continuing to be put back and several large requirements in the market place, there will be tears before bedtime.”

The Glasgow office market also enjoyed a robust start to 2016 with 282,455sq ft of space acquired for occupation during the quarter. This is already past the halfway point compared to the full-year figures for 2015 and the ten-year average for the city.

CBRE highlighted financial giant Morgan Stanley signing a pre-let for 154,814sq ft at Bothwell Exchange – a new development being delivered by HFD Group on Waterloo Street in the city centre.

Take-up was boosted by lettings at Glasgow’s newest office buildings including the Association of Chartered Certified Accountants taking 55,744sq ft across three floors at 110 Queen Street and Registers for Scotland acquiring 17,294sq ft at St Vincent Plaza. At the end of the first quarter, the prime rent stood at £29.50 per sq ft.