AVISON Young has released its global 2020 Forecast, which reveals its commercial real estate predictions for cities including Glasgow and Edinburgh for the coming year.
The report shows that strong occupational office demand is expected to continue in Glasgow as the city benefits from large public sector requirements, private sector enquiries and a spike in lease events. There is also expected to be an increased focus on wellness and sustainability.
“Glasgow is the focus of renewed interest from investors, developers and occupiers appreciating the city’s pro-business attitude,” explained Alison Taylor, principal and MD of Avison Young Glasgow. “The skyline is being re mastered, with approximately 1.5 million sq ft of green offices on site for a variety of government and corporate occupiers. This will help fuel the reinvention of the city’s hotel, retail and leisure base, and bring about a revolution in city living.”
Meanwhile, in Edinburgh, Avison Young anticipates ‘significant’ overseas investor activity to continue with strong appetite from Asia and North America in particular. Limited Grade A office space availability in the capital is expected to affect take-up levels.
“We anticipate that overseas investors will again make up more than 50% of all investment trading in Edinburgh in 2020, a trend started only two years ago,” said Stuart Agnew, principal and MD for Avison Young Edinburgh. “It is possible that German investors will re-enter the market with continuing strong appetite from Middle Eastern and Asian investors.
“Edinburgh’s transportation system is being enhanced further with the extension of the tram line to Newhaven following the recent completion of a £75million expansion at Edinburgh Airport. This, allied to the completion of the St James Quarter and the Johnny Walker visitor centre, will continue to ensure that the capital city retains its status as a major cultural and tourist destination.”
Across Scotland and the UK, the retail sector is going through a period of major change. Avison Young highlighted that Edinburgh will see the delivery of two schemes at either end of Princes Street, with Johnnie Walker’s new global visitor centre in the former Fraser’s department store and the Edinburgh St James development.
Avison Young also anticipates increased focus on environmental matters, with more companies setting zero carbon targets for the year ahead.
Dr Nick Axford, global head of research for Avison Young added, “The political focus is quickly shifting to the debate over the country’s future trading arrangements with the EU, so we are still living with heightened uncertainty on both domestic and international fronts. Occupiers and investors are faced with a complex pattern of shifting forces, with traditional cyclical concerns often outweighed by structural shifts related to the impact of technology, globalisation and climate change.
“Through our research and sector knowledge, we will work to help our partners understand the economic, geopolitical and business drivers, navigate the current market and prepare real estate strategies that have resilience for the future.”