Research into Edinburgh’s new office space highlights ‘imbalance’ of supply and demand
A new study has found that the lack of new office space being built is a ‘threat’ to Edinburgh’s economic growth.
Commercial property consultancy Knight Frank has found that there are no new office spaces being built that have not already been pre-let.
Although there are more than 400,000 square feet of new construction and renovation projects expected to be completed over the next few years, 746,950 square feet of requirements have already been issued in 2022 for the center space. city with an average size of approximately 5,100 square feet
Knight Frank pointed to the success of Haymarket Edinburgh as an indication of the level of demand for office space and the ‘wider flight’ towards high quality housing. The development is fully let before its first building is completed later this year.
The firm’s research from 2019 also highlighted the lack of available Class B space in Scotland’s capital to absorb excess demand, with 720,000 square feet of Class B office space converted thanks to planning for a change of use, mainly to hotels and residential.
Toby Withall, office agency partner at Knight Frank Edinburgh, said: “Edinburgh has a clear imbalance between supply and demand: there is no new building space coming up until 2024, but the level of demand is as strong as it has been for a long time. While some occupiers are downsizing due to the pandemic and incorporating more hybrid working, many are still very keen to have quality space in the city center available to their staff.
“Renovations will improve the situation, but a growing number of occupiers want new building spaces that match their ESG requirements. And, unlike many other major cities, much of Edinburgh’s Class B office supply has been converted to other uses, although this has slowed during the pandemic.
“It is concerning that as a growing capital looking to attract businesses, we are close to a point where there will be no more space to accommodate them. Haymarket Edinburgh demonstrates that there is an insatiable appetite for new, high quality space with access to amenities typically only found in a city centre.
“Edinburgh has become a victim of its own success as a pleasant place to live and visit, which risks stunting the economic growth generated by the development of businesses in the city and attracting them from elsewhere. We need to address the lack of options in the city center as quickly as possible, opening up more development opportunities. »