Prime office rents in Edinburgh have risen year-on-year on the back of solid take-up and an ongoing squeeze in availability, according to the latest research from Cushman & Wakefield.
Grade-A headline rents in the city centre have grown by 12.5% year-on-year to £45 per sq ft during Q1 this year, while prime rents in the non-city centre market have leaped by 20% to £30 per sq ft.
Take-up in the city totalled 209,000 sq ft in Q1, boosted by workspace provider Edinburgh Palette’s 103,000 sq ft deal at 1 Lochside View in west Edinburgh.
Key leasing deals also included the preletting of 14,680 sq ft on the fifth and sixth floors at 30 Semple Street by Hymans Robertson and GE Vernova acquiring 9,464 sq ft at 1 New Park Square, Edinburgh Park.
Researchers said supply continued to prove challenging, with 24 St Andrew Square (48,000 sq ft) and 30 Semple Street (57,000 sq ft) the only prime grade-A office schemes on-site.
The challenging office development landscape and the underlying alternative use value for buildings in Edinburgh has also led to potential development stock being removed from the pipeline.
Edinburgh One, at 60 Morrison Street, was earmarked for 85,000 sq ft of prime grade-A offices, but it was recently purchased by McAleer & Rushe for hotel redevelopment. This followed the 2023 purchases of existing office buildings at 28 St Andrew Square by Dalata Group and 9-10 St Andrew Square by Tristan Capital Partners, also with the intention of conversion to hotel use.
During Q1, Cushman recorded 97 occupier requirements totalling just over 1m sq ft. That included 306,000 sq ft of new requirements since the beginning of 2024.
Adam Watt, associate director at Cushman & Wakefield, said: “We continue to see a competitive landscape in the Edinburgh office market as occupiers vie for the best available space for their talent.
“The office remains central to many businesses as a hub for collaboration and interaction, and with limited prime grade-A options available and a constrained development pipeline, occupiers are having to enter the market well in advance of their lease expiry date.
“Prelets will be required to deliver the development stock not currently on-site, so early engagement from occupiers with landlords is critical in unlocking these opportunities.”
View current office availabilities in Edinburgh >>
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