Agent remains confident
Number of office deals in Edinburgh down by half
Haymarket accounts for a large chunk of office space let this year
The number of office deals in Edinburgh so far this year is less than half that of 2019, although it is the only UK regional office market that has seen take-up exceed last year.
The 30% rise in take-up, which climbed to 395,585 sq ft, is underpinned by one major deal –– the 280,000 sq ft pre-let at M&G’s Haymarket to Baillie Gifford that completed in Q3. This has distorted the general trend.
Data from Savills also found that between Q1 and Q3 2020, the insurance and financial services sector accounted for over 75% of Edinburgh’s office take-up with other notable deals including: Cadence taking 8,500 sq ft of Grade A space at 40 Princes Street; Forecast Financial committing to 4,300 sq ft at Nova House; and Handelsbanken signing on 3,600 sq ft at Waverley Gate.
Despite the pandemic’s impact on office working, Mike Irvine, director in the office agency team at Savills in Edinburgh, insisted that space in the city centre would remain in demand.
He said: “Despite the disruption to the market caused by the ongoing Covid-19 pandemic, those deals that are happening demonstrate confidence in Edinburgh’s city centre office market that will ride out the current uncertainty.”
He added: “The more relevant metric is the supply of ‘prime’ office accommodation of which there is less than 200,000 sq ft currently available, with limited development pipeline.
“It is this prime accommodation that is tailored to the needs of occupiers moving forwards and it is this section of the market that is likely to see the highest potential for rental growth.”