Glasgow is the leading city for start-up businesses in Scotland, with 7,845 new businesses launched in 2017, according to data from StartUp Britain, compared with 6,635 in Edinburgh and 1,683 in Aberdeen. Yet start-ups and SMEs in Glasgow are struggling to find suitable offices and we’re seeing a lack of small office suites threaten to hamper the future growth of these businesses in the city.

According to Savills research, against an average annual office take-up of 45,000 sq ft in the 1,000-2,000 sq ft size band, only six month’s worth (28,000 sq ft) of small office suites remains available.The knock-on effect of such a lack of options is rising occupational costs, with rents on lettings in the 1,000-2,000 sq ft size bracket in 2017 11 per cent ahead of 2016 levels on average, and some deals on the best small space fetching north of £20 per sq ft.

The weight of demand from small businesses has helped give way to a rise in serviced office operators across the city including Nexus Business Space opening on West Regent Street, Spaces Charing Cross in Tay House on Bath Street and Clockwise Offices on Renfrew Street – all of which have launched in the last 18 months.

This reflects a wider national trend which has seen considerable growth in the flexible work space sector, with many new entrants. Demand for such space continues to grow as more businesses, including start-ups, SMEs and even larger corporate companies, see the benefits of flexible work space over a more traditional lease.

However, looking longer term, with over 100,000 sq ft of availability in the bigger 2,000-3,000 sq ft office size band, against a lower average level of annual take-up (only 31,564 sq ft), landlords in Glasgow should consider sub-dividing office suites to cater for those looking for sub 2,000 sq ft space that qualifies for full small business rates relief.

Glasgow is a city in which people want to work and businesses want to base themselves, and it is important we support these businesses and allow them to grow through the provision of suitable and affordable office accommodation. While we welcome the arrival of good serviced office options, this shortage combined with the increased rents being achieved makes a strong case for landlords to split larger suites when they are physically suitable.

Further information

Read more: Scottish offices report