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News Release

Edinburgh

Edinburgh Office Take-up Increases as Supply Diminishes


Edinburgh, 16 July 2012 - Occupier take-up in Edinburgh during Q2 2012 has registered its strongest figures since Q4 2007, according to new research by Jones Lang LaSalle.

Occupier take-up in Q2 totalled 244,232 sq ft comprising 41 deals, an increase of nearly 20 per cent from the Q1 total of approximately 204,466 sq ft. Jones Lang LaSalle was involved in over 55 percent of occupier activity during this period. The take-up figures are a significant improvement on the same period last year when take-up totalled approximately 150,000 sq ft.

Occupier take-up in Edinburgh during the first half of 2012 is 50 percent up on the same period last year, and represents 80 per cent of last year’s entire occupier take-up in Edinburgh. This is the first time that Edinburgh has witnessed  a second consecutive quarterly increase in occupier take-up since Q4 2010.

The strong showing by occupier activity in Edinburgh has undoubtedly been bolstered by a number of significant city centre lettings including Blackrock’s move into 79,842 sq ft at Exchange Place 1, the arrival of Skyscanner (27,122 sq ft) and Investec (10,667sq ft) at Quartermile One.

Whilst the positive take-up by occupiers will be seen as a sign of growing confidence in the market, the increased demand for new Grade A accommodation continues to exert pressure on its supply. Jones Lang LaSalle has calculated that there is only approximately 400,000 sq ft currently available of which approximately 25 per cent is under offer or has strong interest.

New Grade A city centre vacancy is edging below 1 per cent. Atria One and Two will deliver much needed supply into the market for Q1 2013. Atria One totals 186,500 sq ft with approximately 25 per cent pre-let to Brewin Dolphin.

Currently there are only two Grade A core city centre offices which can satisfy a requirement over 40,000 sq ft on continuous floors including Exchange Crescent which will provide approximately 120,000 sq ft within the heart of the Exchange. Demand remains focused on accessibility to public transport which is why the city centre is fairing much better than the business park locations.

Ben Reed, Director of Office Agency, Jones Lang LaSalle, comments:

“We’ve been talking for some time about the squeeze on Grade A supply in Edinburgh, but any doubts that previously existed about the legitimacy of this argument, should surely now be quashed. The combination of occupier take-up increasing for the second quarter in a row, and the availability of City Centre Grade A stock dipping below 1%, will create a major challenge to larger corporates looking at relocation during 2013 -2015. Atria One and Two will provide some much needed relief in 2013. However, other than the Ediston scheme at 145 Morrison Street providing 26,380 sq ft, there are no other schemes under development, so we should expect the market to remain tight for some years to come.”