THE vital commercial office market in Glasgow is back to the activity levels it reached before the financial collapse of 2008.
Thanks to an impressive start to 2018, levels of office occupier take-up have hit a 10-year high, according to data from JLL.
In the market’s busiest six months for a decade, total take-up across Glasgow’s city centre reached 326,313 sq ft between April and June, spread across 32 deals, representing an increase of 50% compared to the same period last year.
In the largest deal of the quarter, Clydesdale Bank took 110,955 sq ft pre-let at 177 Bothwell Street. Other notable deals in the city saw Scottish Executive, Regus and Webhelp sign new deals for city centre space. In the first three months of 2018, take-up of city centre office space amounted to 251,910 sq ft. It was boosted by a major government pre-let at Atlantic Square at the start of the year, setting the tone for the year ahead.
According to JLL, sustained activity in the first half of 2018 has led to an increasingly tight supply, with current market total and new build vacancy rates 6.92% and 0.21% respectively.
In a sign of economic health, there is active demolition and construction of Grade A buildings across Glasgow, including the development of some 284,000 sq ft of prime Grade A office space at BAMTCP Atlantic Square in Glasgow, 187,000 sq. ft. of which was pre-let to house a UK Government hub. JLL also advised on the deal at Atlantic Square – the 10th of 13 new UK regional centres HMRC has announced.
Earlier this year M&G Real Estate unveiled plans for The Grid, a new 12 storey, £100 million Grade A office development spanning 277,500 sq ft in the heart of Glasgow’s city centre.
Alistair Reid, Director at JLL, said: “Glasgow’s office occupier market has had a stellar start to the year, with an incredibly busy six months. While the majority of deals recorded in Q2 were below 5000 sq ft, nine deals over 10,000 sq ft took place, indicating a healthy thirst from larger corporates to secure the city’s best space.
“High demand is causing occupiers to consider their options as early as possible, leading many occupiers to consider refurbished stock.”
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