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News Release

Edinburgh

Edinburgh and Glasgow lead European leasing activity as JLL predicts bright future for office markets


Edinburgh, 10 October 2014 – Glasgow and Edinburgh have both seen more than 80 per cent growth in office leasing activity, according to new research presented at the JLL Research Seminar, held yesterday in both Glasgow and Edinburgh.

Scotland The event which compared Scotland’s two major cities to other major cities on the continent and found that leasing activity in Glasgow had 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.


Placed in the context of broader economic indicators, JLL predicts a bright future for the office markets of Edinburgh and Glasgow with continued high levels of occupier demand, an increase in investment activity and a strong performance from business parks.
Key findings from the commercial property seminar included:

  • Both cities compare well on most economic criteria including retail sales growth and GDP growth. Between 2014 and 2019, retail sales in Edinburgh increased at around 2.8 per cent per annum, quicker than any other European city.
  • Edinburgh’s weakness is a lack of scale, and Glasgow’s is flat population growth.
  • Whilst leasing markets in both cities are showing very strong recovery, vacancy rates are falling and Grade A space remains scarce.
  • Rental growth is still not as strong as some markets and yields are still comparatively high.
  • Edinburgh is ‘punching above its weight’ for investment but Glasgow has some room for growth.

Jon Neale, head of UK Research at JLL, added: “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.”

Cameron Stott, Director of Office Agency at JLL in Edinburgh said:

“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.”