Amidst severely restricted supply in the city centre, west Edinburgh may provide a solution for certain office occupiers in the Scottish capital.

While some will always seek to locate in the city centre, this isn’t true of all sectors. In recent years west Edinburgh has seen significant public sector infrastructure investment and now benefits from excellent public transport links with three rail stations, a tram and bus terminus.

Of all the Scottish cities, Edinburgh in particular suffers from a lack of Grade A office supply in the city centre. While there are a limited number of high quality new build office schemes such as M&G’s Haymarket (350,000 sq ft) and BAM/ Hermes’ Capital Square (53,000 sq ft remaining), these alone are not enough to address the longer term structural supply issues within the city centre.

Moving forward, the lack of available sites for development and restrictions on the height of new development in the city centre will continue to be major contributors to supply issues. Similarly within Edinburgh, the well-documented erosion of office space to alternative uses has contributed to supply restrictions.

The market has perhaps been guilty of crying wolf for too long and many occupiers do not fully appreciate the nature of the shortage of supply. Occupiers now need to implement property searches significantly earlier than previously – at least 12-15 months prior to lease events – giving the opportunity to consider both city centre and out of town options.

Occupiers also need to appreciate that rental inflation is a reflection of rising build costs rather than greedy developers. Regarding costs, there needs to be a move away from dated property metrics such as rates per sq ft and a move towards cost per desk and securing the right space for business/staff amidst severe supply restrictions.

Supply may be addressed to a limited extent by refurbishments but developers and owners need to ensure that any refurbishments are well considered in respect of changing occupier requirements. Old refurbishment models no longer apply and in fact some older buildings are simply not capable of being refurbished to modern standards.

While some occupiers require to be in the city centre, not all do and west Edinburgh provides the car parking and large floorplates that many occupiers seek, at discounts of up to 40 per cent when compared to the city centre.

Numerous long-term occupiers such as Aegon, Sainsbury’s Bank, HSBC and JP Morgan are testament to the success of the location, with many property commentators arguing that at 15 minutes from the city centre, west Edinburgh is not actually a true out-of-town business park but is simply peripheral to the city centre. As a result we may see more occupiers put the west to the test in Edinburgh.

Further information

Read more: Spotlight: Scottish Office Market