THE number of office lettings to complete in Glasgow in the first three quarters of 2022 reached 84, according to new research from Savills, which represents the highest number of deals seen at this point of the year since the firm’s records began in 2013.
The next best year was 2019, which recorded 82 deals over the same period. Savills data accounts for 78 office lettings completed at the same point of the year in 2021, and 43 in 2022. Total Q1-Q3 activity amounts to 306,000 sq ft.
Savills said the increased activity has seen occupiers prepared to pay higher rents in exchange for ‘well designed, energy efficient’ space already ‘fitted out’ and including furniture to allow occupiers to move in immediately. 65% of deals this year have been for sub 3,000 sq ft floorplates, which is said to be evidence that occupiers are choosing the most efficient options – higher quality, smaller offices.
The level of demand sees refurbished Grade B offices offering smaller floorplates letting well, with deals at 24 St Vincent Place, The Ink Building and The Beacon highlighting this trend, Savills added.
Rents on this style of small refurbishment are now achieving up to £30 per sq ft with headline rents for brand new Grade A offices about to reach £36 per sq ft.
Colin McGhee, office leasing director at Savills Glasgow, said, “Average rents are strengthening as occupiers continue to show demand for well designed, fit for purpose offices. This weight of demand is unlocking potential to re-purpose tired and redundant offices, by cutting up floorplates to provide for a range of business sizes. Occupiers want flexible lease terms and ‘easy in’ solutions and landlords who deliver this space are being rewarded with strong leasing activity.”