2020 was an unprecedented year of disruption for the food and beverage (F&B) market which is set to continue well into the first quarter of this year as new lockdown restrictions become more protracted than expected.

In Glasgow, those affected over the last 12 months include well-known operators including Zizzi, Handmade Burger Co, and Las Iguanas. Some of these brands have survived through company restructuring while others have disappeared, resulting in rising vacancy rates in the city centre.

However, the city has not been bereft of recent transactions. Our research shows that in 2020, 11 new eateries opened for business with eight in the second half of the year. Although this was a third less than 2019, it points to a market which has remained surprisingly active, with occupiers taking a long-term view of trading prospects. 90 per cent of these new openings came from local rather than national chains. Highlights include Mamasan who opened their South East Asian inspired restaurant on Ingram Street and Bread Meats Bread who relocated to larger premises in December on St Vincent Street.

So what do we predict for 2021?

1. Rents in Q1/Q2 will remain under acute pressure and will track at approximately 50 per cent of their pre Covid-19 levels. With the current positivity surrounding the vaccination programme, by the start of 2022 rents could recover to approximately 75 percent of pre-pandemic levels.

2. Tenant demand will be strong for fitted restaurants in the city centre.   Attracted by the significantly lower set up costs and the chance of attractive lease terms, savvy operators are casting an eye over opportunities. One fitted Glasgow City Centre restaurant we marketed received four offers within four weeks of launching to the market.

3. Independent food and beverage operators will once again lead the way. Unfettered by over-expansion or paying premium rents, these operators now have a fantastic chance to grow their business. Some operators to watch out for are Maki & Ramen, Wolf, Scoop Restaurants, Mowgli, Innis & Gunn, Boom Battle Bar, Heavenly Desserts, Ting Thai Caravan, Lemongrass Group, Tony Macaroni and Cosmo.

4. Development activity is coming on stream which will change the dynamic of the market this year. Top of this list is St Enoch, where a new leisure & restaurant quarter is set to open in the spring. This will be the first fully under-cover leisure destination in the city centre where VUE will be joined by Cosmo, Nando’s, Donut King, Boom Battle Bar, Delhi Darbar and Philly Steaks & Shakes.

5. United Nations COP26 will provide a boost for F&B in Q4 2021. Glasgow has a strong business district and pre-pandemic short stay tourist traffic had been growing significantly. While the first half of 2021 will be quiet, eyes will quickly turn to the UN COP26 summit in November – the largest ever summit to be held in the UK.

6. Finally, turmoil will bring opportunity. For occupiers who are prepared to accept a degree of risk given the pandemic, 2021 is arguably a time of real opportunity. There are prime restaurant opportunities available to lease, and landlords are offering attractive terms to help kick-start the market. For the brave among us, 2021 could be the year to make these big decisions. 

Further information

Contact John Menzies

Savills Retail