Take-up

Take-up reached over 113,000 sq ft in the final quarter of 2023, based on 34 deals done, 10% higher than the number of deals completed in Q4 2022. Q4 2023 take-up was 19% higher than Q3 2023. The largest deal of the quarter was by MFMac, leasing 16,000 sq ft at 9 Haymarket Square, a Prime-graded building.

Grade A take-up in Q4 equated to 69,000 sq ft, which accounted for 61% of the total. Therefore, Q4 was 180% above the same period in 2022, and 4% above the five-year Q4 average, continuing to demonstrate the market demand for higher-quality buildings.

Supply

Q4 2023 availability still stands at over 1 million sq ft, which is 5% higher than the ten-year average. Grade A continues to dominate the availability, with 51% of the total, whilst Grade B accounts for 32%. The vacancy rate for Edinburgh has increased slightly to 11.6%.

Prime availability stood at 183,000 sq ft, which accounted for 17% of the overall total – this was an increase of 3% on Q3 2023 supply; however, there is still only 0.8 years of Prime availablity in the market.

Take-up by business sector

The 'Professional' sector dominated take-up in Q4, accounting for 33% of the take-up total. This is across nine deals, with a combined total take-up of 38,000 sq ft, with 84% of this being Prime space at a total of 32,000 sq ft.

Furthermore, the 'TMT' sector leased 25,000 sq ft based on six deals, accounting for 22% of the total. The largest deal in the sector was by Zonal Retail Systems Ltd, which acquired 12,000 sq ft of space at 1 Tanfield.

Rents

There was an increase in the Prime rent in Q4 2023, to £43 per sq ft, up 1% on Q3 2023, with the rent 6% above the Q4 2022 Prime rent. This established Edinburgh as having the joint highest rent in the UK Big 6 markets alongside Manchester. Looking at the further growth prospects, the five-year outlook for the market is optimistic, with Savills predicting that the prime rent will be at or above £50.50 per sq ft by the end of 2028, representing a 17% increase.

Interested in other areas of the UK?

View all of our latest Q4 2023 Occupational Office Data research here.