Scotland In My View – Greater Glasgow and Central Belt Has Seen Strong
Rental Growth by Sven Macaulay Partner Gerald Eve Glasgow This demonstrates that a thoughtfully designed building meeting modern occupier demands in terms of scale, density, ESG credentials and in a good location is still very much sought after by occupiers and I expect to see more speculative schemes coming forward over the next couple of years, subject, of course, to the economic market conditions being conducive to doing so.
The industrial market across the central belt is continuing to show remarkable resilience despite challenging economic times in the UK. It remains in rude health with relatively constant demand and vacancy rates continuing to be very low. This is good news for investors who are generally experiencing high occupancy rates across their estates and strong rental growth in most cases. Developers who have been able to speculatively build are reaping the
rewards with successfully let
schemes, most of them pre-let during construction or soon after completion.
For many years, Scotland has seen very little speculative development of significant proportions. Eurocentral with its economic tax breaks as an Enterprise Zone where the last large building was constructed in 2011 was the biggest for many years. Saying that, over the past two years or so we have seen new buildings of over 40,000 sq ft developed across various schemes at Bellshill and Tannochside - Knight Real Estate, West Ranga, J. Smart and Cedarwood have all developed single or multiple ‘large’ warehouses, and without exception these have all been successfully let. Canmoor is about to complete the speculative development of two buildings of 90,000 sq ft and 200,000 sq ft at their Westway site in Renfrew with the larger building under offer and strong occupier interest in the smaller building.
With every coin there are, of course, two sides – some occupiers face affordability issues in a market that has witnessed steep rental rises over the past 5 years. The combination of continued scarcity, sustained demand, expensive build costs and comparatively soft investment yields have combined to drive rents up to and, in some cases, well above £10 per sq ft. Equally, where there used to be quite a large gap between new build rents and rents for existing older buildings, we have seen the gap for high-quality refurbished accommodation decrease considerably over the past couple of years and there is less than £1 to £2 per sq ft difference in some cases.
In summary, our industrial building market remains healthy for investors and developers whilst being somewhat problematic for occupiers, particularly those looking for space to suit their needs as they are often faced with little choice and increasing occupational costs. Further development will assist with sating the demand for space but it will come at a cost.
By Sven Macaulay Partner Gerald Eve Glasgow
M9 COMMERCIAL PARK, BEANCROSS ROAD, GRANGEMOUTH, FK3 8LH - UP TO 9 ACRES AVAILABLE FOR COMMERCIAL DEVELOPMENT OR OPEN STORAGE
- STRATEGIC LOCATION CLOSE TO J5 & 6 OF M9 MOTORWAY AND WITHIN 20 TO 25 MINUTES OF GLASGOW & EDINBURGH - ALL ENQUIRIES
Sven Macaulay
smacaulay@geraldeve.com 07767 310373
geraldeve.com COMMERCIAL PROPERTY MONTHLY 2024 0141 221 6397
geraldeve.com 19
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60
