Glasgow is on track for a record year of office take-up in 2018, with a number of giant lettings bumping up figures and placing greater pressure on an ever more reduced supply of Grade A office space.

With the Government Property Unit, Barclays and Clydesdale Bank all committing to major deals in 2018, activity at the end of the third quarter totalled 1.185 million sq ft, three times ahead of the same point last year and double the 10-year average.

This has resulted in the vacancy rate for city centre offices shrinking to 9.9 per cent, and rents climbing to £32.50 per sq ft for the new Grade A offices and £30 per sq ft for the best refurbished office space.

Yet, despite encouraging market fundamentals, new office development remains subdued in Glasgow, as has been the case for over three years. Savills is marketing the only speculative office building in the city – a 94,000 sq ft city centre development from FORE Partnership. On completion in 2020 Cadworks will boast Scotland’s first ‘cycle-in’ ramp, allowing employees to ride into the office. Rents for the flagship Scottish development are expected to fetch new headline levels.

Aside from Cadworks, comprehensive refurbishment of redundant and/or tired offices in the city centre will be key in Glasgow in 2019, as has been the case in 2018, with good quality refurbishments letting quickly. This will result in further pre-let commitments on new-build Grade A space and upward pressure on good quality offices by the end of 2019.

Next year will also see the completion of the Ink Building, above, which will offer occupiers up to 35,000 sq ft of ‘defurbed’ office space. Other good quality refurbishments include 30,000 sq ft at 151 West George Street.

Letting activity looks unlikely to wane, with over one million sq ft of named demand from occupiers including JP Morgan, Network Rail, Scottish Social Security Agency and WeWork. The ongoing supply/demand imbalance could see pre-lets kick-starting development sites in the city including Osborne + Co's Argyle Street development (285,000 sq ft).

Further information

Read more: Scottish Offices Report