Who is CBRE and what's your presence in Edinburgh?
CBRE is a global property firm headquartered in Los Angeles. We are the the world’s largest commercial real estate services and investment firm and we have more than 80,000 employees across 450 offices worldwide.
We’ve seen significant interest in all developments that landlords have chosen to speculatively develop. We hope this will encourage more developers to progress office opportunities, whether that be new build or high quality refurbishments.Allan Matthews, advisory and transaction services director, CBRE
We have been operational in Scotland for more than 60 years, advising a wide range of clients in the private and public sector on property sales and leasing, facilities and project management, appraisal and valuation, development services, investment management and research. Our team in Edinburgh consists of 40 professional and support staff.
How is Edinburgh's office lettings market performing and why?
Our research has revealed a strong second quarter for Edinburgh’s office market after a slow start to the year. Figures show Q2 take-up of 351,916 sq ft - a 150% increase in take-up from Q1 2018, with half yearly take-up amounting to just under half a million sq ft (491,885 sq ft).
Total supply remains at a critically low level at 923,540 sq ft, dropping even further to 225,231 sq ft for city centre Grade A space. This represents a 30% decrease on the available space from the same period in 2017, which stood at 1.33m sq ft at the end of Q2.
What key deals have been done in the last quarter?
The most notable deal in the second quarter was asset management firm Baillie Gifford taking over 60,000 sq ft at the newly developed Mint Building in St Andrew Square, with other large lettings including 43,801 sq ft at 11-12 Lochside Place to Diageo and 14,832 sq ft at Atria One to EDP Renewables.
The largest deal of the quarter was Edinburgh Palette occupying 109,153 sq ft of space at 525 Ferry Road. However this deal is on a flexible, short term arrangement.
There are other transactions which continue to demonstrate the strength of the Edinburgh office market, not only in the city centre but in established, out of town locations as well. Another significant deal was The Scottish Public Services Ombudsman taking 16,568 sq ft of out of town space at Bridgeside House on MacDonald Road.
What's the outlook and what does this mean for Edinburgh?
There continues to be a number of larger, unsatisfied requirements for Edinburgh city centre.
While M&G Real Estate has completed the purchase of The Haymarket, and it is anticipated that speculative development will commence on site as quickly as practical, the city still faces a severe shortage of high quality Grade A accommodation in the immediate short term.
2 Semple Street, ready for occupation at the end of July 2018, will be the next development to complete in Edinburgh city centre, providing 38,648 sq ft of Grade A office accommodation.
We’ve seen significant interest in all developments that landlords have chosen to speculatively develop. We hope this will encourage more developers to progress office opportunities, whether that be new build or high quality refurbishments. The trend of pre-letting is now well established in the city.
If you would like to find out more about how we can help you and your business establish, relocate or expand within the city region, or would simply like more information about what Edinburgh has to offer, get in touch today.