Market snapshot

Office Market Pulse Glasgow Q3 2013

Take-up of office space in Glasgow city centre totalled 124,421 sq ft in Q3, up 50% from the same period in 2012. The city centre also witnessed a welcome return of several grade A deals, the likes of which have not been seen in over two years.

Download a PDF of our latest Glasgow Office Market Pulse, or read and sign up to receive Office Market Pulses from other UK centres.

In this issue:

Q3 sees the return of several grade A deals to Glasgow city centre

City centre take-up in Glasgow totalled 124,421 sq ft in Q3, up 50% from the same period in 2012. This takes the year-to-date total to approximately 325,227 sq ft; 11% higher than the corresponding period in 2012.  The final take-up figure for 2013 will be around the 400,000 sq ft level. 

ATOS IT Services, Midland Valley and HBJ Claim Solutions all took grade A office space in Q3; the first time we have seen significant grade A take up in two years 

Q3 take-up in Lanarkshire was 28% lower than the corresponding period in 2012 with only a handful of deals concluded, including 4,500 sq ft at Maxim and two deals at Cambuslang totalling 4,600 sq ft and 2,900 sq ft. 

There continues to be stronger demand for locations west and south of Glasgow. Kent Foods has taken circa 7,000 sq ft at Titanium, Braehead Business Park, and there have also been a number of deals within the Hub at Pacific Quay ranging from 200 sq ft up to around 3,000 sq ft.

For a detailed breakdown of Q3 2013 take-up by grade, please click here or on Chart 1 to the left of this article.

Significant Glasgow office lettings Q3 2013

Property 

Size (sq ft)

Landlord / Vendor  Tenant / Purchaser 
Ground, First, Second and Third Floors, Capella, 60 York Street

37,582

British Airways Pension Trustees ATOS IT Services
Fifth Floor, 151 St Vincent Street

10,860

Hermes Real Estate Skyscanner

Inovo, 121 West George Street

9,293

Scottish Enterprise Offsure Renewable Catapult
Ninth Floor, 2 West Regent Street

7,294

Kennedy Wilson Midland Valley Exploration
First Floor, Centenary House, Wellington Street

7,255

NFU Mutual

HBJ Claims Solutions

Source: Lambert Smith Hampton

Less than two year’s supply of grade A office space in Glasgow city centre

Grade A availability in the city centre remains constrained at 180,000 sq ft, which accounts for just 1% of the City’s total available office space and represents less than two year’s supply. 

A number of grade A deals are currently under offer, which will reduce this figure even further . Only Cuprum at Argyle Street is able to provide over 50,000 sq ft of space.

Refurbished grade B stock in the city centre currently stands at around 550,000 sq ft. There will be high demand for this space until new development completes in mid to late 2015.

Total out of town supply in Lanarkshire currently stands at around 1.8 m sq ft, with Maxim Business Park accounting for around 36% of this figure.  

For a breakdown of Q3 2013 office supply by grade, please click here or on Chart 2 to the left of this article.

Prime rents remain stable both in and out of town

Prime rents within Glasgow city centre remain unchanged and vary significantly from £22.00-£28.50 per sq ft. It is understood the letting at Capella was done at around £25 per sq ft. 

Rental levels for second hand grade A / refurbished grade B is between £17.00 and £22.00 per sq ft with 151 St. Vincent Street remaining the exception at £25.00 per sq ft quoting. 

Out of town prime rents range from £15.00 – £22.00 per sq ft.

For a breakdown of Q3 2013 office rental values, please click here or on Chart 3 to the left of this article.

How did the national investment market perform in Q3 2013?

Despite London’s relative expense, quarterly investment increased to almost £5bn, which was more than double the amount transacted in the first quarter of the year.

Regional investment levels in Q3 are the highest they have been since Q1 2011. Total investment was £3.71bn, a 14% increase on the Q2 figure of £3.24bn. 

Overseas investors purchased £4.16bn of UK property in Q3: the highest total since Q2 2012. However, early indications are that UK investors are ready to play a larger part in the market, accounting for 55% of the quarterly investment total: a 15 point increase on the 2012 average. 

What does this mean for the market? Find out in UKIT Q3 2013.

Want more information about this Snapshot?

Aasia Mohammad

0141 226 6786

Email me

Regions

Contact us now

Aasia Mohammad
Associate Director - Business Space

0141 226 6786

How can we help?

Submit