Edinburgh commercial property boom

Three of the largest city centre deals in the UK have meant a record-breaking quarter in commercial property take-up in Edinburgh – but with a warning that the property pipeline is drying up.

The city saw a “staggering” 175 per cent rise in take-up over the five year quarterly average in the second quarter of 2017, with a total of 432,350 sq ft.

Commercial property advisory business GVA said the rise was driven by the Government Property Unit’s agreement to let 189,000 sq ft at New Waverley and investment manager State Street’s decision to pre-let 65,600 sq ft at Quartermile 3.

Peter Fraser, GVA’S director of business space in Edinburgh, said the city had “massively outperformed all other regions in the UK in terms of square feet take-up”.

He said: “Pleasingly there has also been inward investment transactions among the large deals, with an Australian financial services firm taking 41,000 sq ft of space at the newly refurbished Edinburgh House, North Street.”

However, Fraser added: “No new stock is coming through to replace let or pre-let space and there is now a significant shortage in Edinburgh.”

He said the merger between Standard Life and Aberdeen Asset Management could be “crucial” in freeing up space.

“Combined, they occupy just under 1 million square feet of space in the capital and theoretically they could downsize when they merge, which would bring additional space to a market starved of new supply.”

St Andrew 0 Peter Fraser of GVA – ‘exceptional’ quarter