October 13, 2014
Glasgow and Edinburgh have both seen more than 80 per cent growth in office leasing activity in the past year. A comparison of Scotland’s two major cities to other major cities on the continent at a recent JLL Research Seminar revealed that leasing activity in Glasgow increased by more than 120 per cent between July 2013 and June 2014, in comparison to the same period from 2012-2013. The increase in leasing activity placed Glasgow at the top of the list of forty comparable European cities. Edinburgh is fourth in the list with an increase in activity of around 80 per cent. The office markets of Edinburgh and Glasgow are expected to see continued high levels of occupier demand, an increase in investment activity and a strong performance from business parks. However, Edinburgh’s weakness is a lack of scale, and Glasgow’s is flat population growth; and though leasing markets in both cities are showing very strong recovery, vacancy rates are falling and Grade A space remains scarce.
Jon Neale, head of UK Research at JLL, explained: “A comparison across Europe shows that both Edinburgh and Glasgow are well positioned to compete, and that their economies and property markets are likely to flourish over the coming years.
“However, there are lessons to be learned too; greater investment in infrastructure, and particularly in rapid transport along the central belt, would help both cities gain greater scale and compete for investment alongside other important European cities and capitals.”
Added Cameron Stott, Director of Office Agency at JLL in Edinburgh: “Both Edinburgh and Glasgow have seen significant infrastructure investment in recent years with Glasgow hosting the Commonwealth Games and Edinburgh investing in trams, railway stations, railway lines and the new Forth crossing.
“However, whilst both cities have clearly benefited over the past 12 months, further investment is required in order to maintain their positions as leading European cities and to continue attracting further inward investment.
“The Universities in both cities will also be central to their future success. We need to see the development and retention within Scotland of quality graduates who can help to maintain the burgeoning TMT sectors.”