Edinburgh commercial property rut shows potential 2011 upswing

Edinburgh is going through a slow period with the office market stuck in something of a rut although the tightening supply situation indicates an upswing in 2011. Stewart Taylor of CB Richard Ellis said: “The current phase of slack water which the market is in will prevail for much of this year but this is, in itself, an indicator of changing conditions.” “The most encouraging characteristic of the year to date has been the reappearance of some larger requirements which were almost completely absent throughout 2009. This, coupled with stabilisation within the financial sector and retreating fears over accommodation release, should contribute to the changing tide.” In fact the first half take up of 25,084 sq.metres (270,000 sq.ft.) was reasonable and, according to Ian Lochhead of Drivers Jonas, there is only 55,740 sq.metres (600,000 sq.ft.) available. He noted that “with offices part let it is hard for occupiers to find large spaces so that someone with a 9,290 sq.metres (100,000 sq.ft.) requirement would have a problem finding it.”

At least there is some hope on supply with Edinburgh Council giving the green light to the £85 million expansion of the international conference centre in a design by architects BDP. This will increase the conference space by 9,290 sq.metres (100,000 sq.ft.) and double that amount in speculative offices which are likely to be very welcome when completed in 2013. Kenny Waitt of Jones Lang LaSalle commented: “Nothing else of this stature, quality of site and location is expected to come out of the ground in Edinburgh over the next three years, so it is going to effectively be the market.”

The investment market remains firm and one of the latest deals in the offing is the Swiss investor Afia paying around £20 million (yield 7%) for the 3,948 sq.metres (42,500 sq.ft.) second building in Gladedale’s £450 million development of the former Royal Infirmary site. The building already has a tenant in the law firm Morton Fraser.

The Scotland Commercial Property Register

The Scotland Commercial Property Register for Sctoland is a leading UK business property publication from Martin Austen Publishing. The aim of the publication is to offer a simple and effective means of finding Offices Space, Serviced Offices and Commercial Property in Scotland . You can also find the latest commercial property news for Scotland.