Take-up

In the fourth quarter of 2023, take-up equated to 77,000 sq ft over 23 deals done. Whilst this was down 23% on the previous year, H2 provided stronger market positivity, with a 30% increase on the H1 total take-up. Overall, 2023 total take-up equated to 310,000 sq ft which was 24% down on the previous year.

Grade A take-up totalled 46,000 sq ft, therefore consisting 59% of the total. This was 122% higher than the total Grade A take-up in Q4 2022. Of the 23 deals done, 30% of these were for Grade A buildings. 2023 Grade A take-up amounted to 135,000 sq ft, which was only 7% down on 2022.

Supply

Total availability in Glasgow City Centre amounted to 1.6m sq ft at the end of Q4 2023, a 2% increase on the same period in 2022. Secondary space continues to dominate supply, with just over 1m sq ft available for Grade B/C space, equating to 63% of the total.

Grade A and Prime supply totalled 586,000 sq ft; 37% of the total. The vacancy rate in Q4 for Grade A buildings has decreased to 2.5%, down from 3% in Q3, illustrating the demand in the market for best-in-class space, but also highlighting that demand is outweighing current supply.

Take-up by business sector

The most active sector in Q4 was 'Business & Consumer Services', which acquired a combined 39,000 sq ft, therefore amounting to 51% of the overall total. This was the sector's highest quarter take-up in the market since Q2 2018. The largest deal in this sector was 19,000 sq ft, in which Cubo acquired space at Aurora, 120 Bothwell Street.

The 'Professional' sector leased 17,000 sq ft of space in Q4, which accounted for 22% of the total. This was largely driven by Aggreko, leasing 9,000 sq ft at Sentinel, Waterloo Street which accounted for over half of the total take-up for the sector. Overall, the sector leased the most space in 2023, totalling 84,000 sq ft, accounting for 27% of the total.

Rents

There was no change in the Prime rent in the fourth quarter of 2023 which currently stands at £37.50 per sq ft. This means that the prime rent has grown by 25% over the last five years. Further rental growth is forecast for 2024 to £38.50 by the end of the year, with latest projections expecting growth to reach at least £45 per sq ft by the end of 2028. This would represent a 17% increase over the next five-year period.

Interested in other areas of the UK?

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