Glasgow’s office market has continued to see an increase in uptake during the first quarter for this year, with prime office spaces expected to become more scare, pushing rent higher.
Property firm Savills reported a 49% increase in uptake from the last quarter of last year, with Glasgow recording 63,388 sq ft of take up, with a further 170,000 sq ft of office space under offer.
Despite this, the company revealed take-up was down on the five year average by 67%, although the volume of requirements and current space present "strong prospects" for the remainder of the year.
More than half of take-up came from construction firm Multiplex Europe, which let 34,000 sq ft at 2 Cadogan Square, the largest office deal in Glasgow during the first quarter this year.
Demand for prime office space in Glasgow remained at pre-pandemic levels, with requirements in the market totalling around 800,000 sq ft, revealing significant occupier confidence in Glasgow, according to Savills.
Current availability in Glasgow stands at 1.1 million sq ft. Only 37% of this is Grade A, totalling 426,000 sq ft, with 187,000 sq ft expected to be delivered in the second or third quarter of this year as new build or refurbished space.
Savills expects rents to rise in 2021 as the new developments become available as stock remains limited, reaching £34.50 per sq ft in 2022.
David Cobban, director in the office agency team and head of Savills Glasgow, said: “There is a lack of Grade A offices in Glasgow, and with occupiers seeking out the best offices, we expect continued upwards pressure on rents.
“We have also seen a resurgence of requirements below 5,000 sq ft and expect demand in this market to grow as small to medium-sized enterprises (SMEs) have begun to recover from the disruption caused by Covid-19.”
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