Take-up

Q1 2022 take-up, totalling 196,000 sq ft, was an increase of 115% on the Q4 2021 total. Furthermore, this was the highest Q1 total in the last ten years, and a significant 95% above the five-year Q1 average. Overall, this represents a strong bounce-back after a difficult 2021 in terms of market activity. After just one full quarter, 2022 take-up is only 1% below the annual total for 2021.

Grade A take-up, totalling 129,000 sq ft, equated to 66% of Q1 take-up. In terms of proportion of total take-up, this was 45% above the five-year Q1 average Grade A proportion.

Supply

Total supply decreased by 7% in Q1 2022 to a total of 2.6 million sq ft. Furthermore, Grade A supply also decreased by 9% to 785,000 sq ft. This is the lowest level of total available supply since 2019 and is in line with the five-year average for the market.

The total vacancy rate decreased by 1.9% to 25.3% in Q1 2022. Additionally, Grade A vacancy rate increased by 0.8% to 7.6% at the end of the quarter.

Take-up by business sector

The 'Extraction & Utilities' sector was the most active in Q1, accounting for 68% of total take-up. This included the 100,000 sq ft acquisition at the Silver Fin Building by Shell.

Elsewhere, it was also a strong start to the year for 'Public services, Education & Health' who took a 13% share of overall take-up. This included an 18,000 sq ft letting to North Sea Transition Authority at Marischal Square.

Rents

The prime rent remained stagnant in the first quarter of 2022, which currently stands at £32.50 per sq ft. Between 2016 and 2022, prime rent has grown by 3.2% in the Aberdeen market. That being said, average Grade A rents have fluctuated during this period, reaching a high of £27.38 per sq ft in 2017 and hitting a low of £21.64 in 2019. In Q1 2022, average Grade A rents increased to £23.50 per sq ft, which suggests there is cause for optimism and potential for further growth in the coming months.

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