Investment in Scotland’s property market remains steady despite market challenges

Investor interest in Scotland’s commercial property market during Q1 steady, despite lack of stock

April 11, 2019

Investor interest in Scotland’s commercial property market during Q1 has been steady, despite a lack of stock on the market and ongoing political uncertainty surrounding Brexit, according to new research from JLL.

Investment volumes were significantly down on the same period in 2018. However, as reported by JLL recently, there are also eight deals currently under office on an off-market or targeted basis in Edinburgh and Glasgow, compared to two at the same time last year. 

Three of the most significant deals of the year to date include the sale of Interpoint at Haymarket Yards in Edinburgh to BP Investment Management for £18.85 million, the sale of Atlantic Quay 2 in Glasgow to Corum XL for £22.25 million and the sale of the Air Cargo Centre at Glasgow Airport for £11.1m.

Commenting on the latest figures, Chris Macfarlane, Director - Capital Markets, for JLL in Scotland said:

“It feels a little like the morning after the night before! With 2018 proving to be one of the strongest years on record in terms of investment volumes, Q1 2019 was always going to have a tough act to follow. So it has proved with the market becoming ‘sticky’ and levels of activity being more subdued. Macro-political uncertainty has exacerbated an easing of investor confidence.

“Vendors are not wanting to openly expose the product to the market at a time when some active buyers are looking for value. Other buyers, however, are viewing the current period as a buying opportunity in a less crowded market.

“Assuming there is some sort of orderly outcome to Brexit, we envisage a more active Q2 and a stronger second half of the year. The weight of capital still to be deployed remains as strong as ever, which should ensure pricing (at least for prime product) remains firm”.

Looking ahead to the remainder of the year, JLL’s Q1 Capital Markets Scotland Snapshot has made the following five observations:

1.  Far Eastern investors will dominate the acquisition of larger office transactions in Edinburgh.

2. Retail warehousing will continue to see improved levels of interest, albeit from a low base, particularly for urban parks with strong underlying alternative use value.

3. UK institutions will continue to be net sellers, although those fronting for overseas mandates will be active in the prime sector.

4. The volume of hotel transactions with management contracts, rather than traditional leases, will increase as investors seeking a yield margin become more comfortable with these structures.

5. And finally – the ‘B’ word. Assuming an orderly form of ‘Brexit’, we are anticipating a meaningful ‘bounce’ when it is finally agreed.


About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. Our vision is to reimagine the world of real estate, creating rewarding opportunities and amazing spaces where people can achieve their ambitions. In doing so, we will build a better tomorrow for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.3 billion, operations in over 80 countries and a global workforce of over 90,000 as of December 31, 2018. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit