Scottish retail property demand grows

Surveyors reported a rise in inquiries from people wanting to invest in retail space. Picture: Ian Rutherford

The Royal Institution of Chartered Surveyors (Rics) reported an “upbeat” picture as increasing optimism about the economy and more accessible lending filtered through to the commercial sector.

Rics’ commercial market survey for the last three months of 2013 found a balance of 48 per cent more surveyors in Scotland were seeing an upsurge in demand for such work spaces.

Retail has also begun to see signs of an improvement, Rics said, as a net balance of 46 per cent more chartered surveyors reported a rise in inquiries from people wanting to invest in retail space. This looks set to continue, with the survey suggesting there will be a further increase in the volume of retail transactions over the next quarter.

But a net balance of 33 per cent of those surveyed spoke of a decline in availability of commercial property, partly reflecting the lack of new developments in recent years.

Alan Gilkison, of Ryden LLP in Glasgow, said: “The greatest activity remains in the prime locations with acute shortages of smaller properties. However, there are signs of growing interest for new build solutions given the absence of suitable stock.”

Rics Scotland director Sarah Speirs said: “The Scottish economy ended 2013 on a much more positive note and this was reflected in stronger demand from tenants for shops, offices and industrial space. The more upbeat picture is even beginning to filter through to rents and investment, although the improvements are still tentative at this stage.

“The shift in the retail market has been largely driven by the improved fortunes of the consumer and this is now feeding through, slowly but evidently, to high street.

“Should the economic momentum continue to gather pace we would expect the recovery in the commercial property market to gain further traction, particularly if interest rates remain on hold.”