Property update

Office demand in capital almost doubles in Q2

10 George Street

Biggest letting: 10 George Street

Edinburgh office take-up increased nearly 80% in the second quarter of 2021 compared to the first three months of the year as the economy began to emerge from lockdown, according to analysis from property consultancy Knight Frank.

It found that about 160,000 sq ft of office space was transacted between April and June, up significantly on the estimated 90,000 sq ft of take-up in the first quarter and 10,900 sq ft during the same period last year – the height of the first lockdown. 

Professional services was the most active sector, while the Nursing and Midwifery Council’s 11,500 sq ft letting at 10 George Street was the largest deal of the quarter, and the average letting size was 4,100 sq ft. There were also a large number of re-gears and lease renewals during the second quarter, which amounted to 58,000 sq ft of office space.

Knight Frank said that, with lockdown restrictions easing, demand for space remaining consistently high, and people likely to start returning to offices towards the end of the summer, there could be a significant uptick in take-up activity from September. 

Toby Withall, office agency partner at Knight Frank Edinburgh, said: “The second quarter of 2021 has built on the positive start we saw during the first three months of the year.

“It is highly encouraging to see so many businesses commit to office space, underlining the cautious optimism that has emerged with lockdown easing, the economy gradually re-opening, and companies looking beyond the pandemic.

“Part of the rise in activity can also be attributed to a number of the deals that were delayed by Covid-19 starting to conclude, with the handbrake coming off decision-making and office activity likely to increase after the summer.

“This suggests that, although many occupiers understandably put commitments on hold during lockdown, offices remain a key part of their business plans, even if working from home still plays a part in how they operate in the future.

“That said, there are clear office trends emerging from the pandemic. More collaboration space and amenities for staff are becoming increasingly important for occupiers, along with the sustainability and energy efficiency of their property footprint – all of which will be important for landlords to keep front of mind.”

Leave a Reply

Your email address will not be published. Required fields are marked as *

This site uses Akismet to reduce spam. Learn how your comment data is processed.