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Spotlight: Scottish Office Market – Autumn 2016

The office investment market in Scotland has remained active with transaction volumes consistent with 2015 and income returns more attractive than comparable English cities

■ Office take-up within the three Scottish cities remains strong, reaching 1.7m sq ft as at end Q3 2016, the same level as this stage during 2015.

■ Total availability in the Scottish cities has only risen 5% to 5.1m sq ft over the course of 2016, which is largely down to an oversupply within the Aberdeen market.

■ Rents on good quality refurbishments are growing in Edinburgh and Glasgow and the differential between this market and new build stock is narrowing in both markets.

■ As at end Q3 2016, office investment volumes have remained healthy in the three Scottish cities and reached £529m, only 5.5% down on the same period during a strong 2015.

■ Office investment has remained strong in the Scottish cities and has been less affected by Brexit concerns than the UK average.

■ With Scottish commercial property yields around 50 to 100bps higher than comparable English cities, Scotland offers investors a highly attractive yield, at a time when returns will be income led.

6 St Andrew's Square, Edinburgh, completes during November 2016, following a 108,000 sq ft prelet to Standard Life Investments

▲ 6 St Andrew's Square, Edinburgh, completes during November 2016, following a 108,000 sq ft prelet to Standard Life Investments

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