A shortage of modernised stock and an absent pipeline supporting robust rental growth forecasts.
The development pipeline is heavily constrained, with a current shortage of new-build stock. Occupier requirements — particularly those exceeding 100,000 sq ft — remain unmet, making the build-to-suit option the only viable solution, though it still presents its own development challenges.
Ross Sinclair, Director, Industrial Agency
GLA1 in Gourock, where a 296,273 sq ft unit is available to lease.
Supply
Across Scotland, availability stands at 2.68 million sq ft, spread across nine units, which is 294% higher than the same period last year and represents 3.38 years’ worth of supply. Scotland’s vacancy rates have increased from 2.97% at the end of 2024 to 11.72% now — an increase of 875 basis points (bps).
The sharp increase was mainly driven by Q2 and Q3 2025, during which supply grew by 142% and 34% respectively, quarter-on-quarter. The notable rise was primarily due to the former HarperCollins unit, introduced to the market in Q2 2025, comprising 860,892 sq ft of Grade C second-hand space, accounting for 32% of the total supply.
Since Q4 2024, there has been a shortage of new and second-hand Grade A space in Scotland. In fact, 77% consists of second-hand Grade C space, while the remaining 23% is second-hand Grade B space, which significantly limits options for modern occupiers. Regarding unit sizes, five units are available in the 100,000–200,000 sq ft range, two in the 200,000–300,000 sq ft range, one in the 400,000–500,000 sq ft range, and one exceeding 500,000 sq ft.
However, due to a shortage of modernised stock, many occupiers are increasingly worried about rising power demands to meet future energy needs and the ability to improve environmental performance, especially as we move towards net-zero carbon targets. Savills suggests that this will render some units occupationally obsolete, further decreasing the choice and overall availability of functional stock. In light of this, Savills has revised its rental growth forecasts, estimating a 3.4% annual increase over the next five years in our baseline scenario.
Take-up
Full-year take-up reached 516,026 sq ft across three transactions, 38% lower than the previous year. All these transactions took place in the first half of 2025, making the second half of 2025 considerably weaker compared to the long-term H2 average (2007–2019) of 606,278 sq ft.
Assessing the type of space transacted, but given the lack of prime or Grade A second-hand stock, it was no surprise that take-up consisted of lower-quality second-hand buildings, with 41% of the space let being Grade B and 59% Grade C. The year's biggest deal was J&D Wilkes’s purchase of the 211,404 sq ft Foote & Telkes Building located at the Michelin Scotland Innovation Parc (MSIP) in Dundee.
Regarding size brackets, one transaction took place in the 100,000–200,000 sq ft range, and two units were sold in the 200,000–300,000 sq ft range. No additional deals were recorded. Of these transactions, manufacturing-related occupiers accounted for 61% of total activity in 2025, while the ‘other’ sector comprised 39%. There was no activity from third-party logistics firms or parcel companies.
Development pipeline
There has been no change in the speculative development pipeline following the recent completion of Westway 200 (202,000 sq ft) in Q4 2024. This is unlikely to change in the near future, as developers are struggling to manage development viability. However, it is not due to a lack of sites; we are monitoring approximately 629 acres of deliverable land with planning permission, capable of providing a further 9.07 million sq ft, which could offer build-to-suit options to help meet that demand.