Agents pick the most significant deals (for the six months to end of April 2016)
Buchanan Street, Glasgow
Type of deal Retail letting
Landlord TH Real Estate
Tenant Massimo Dutti
Size 11,000 sq ft
Rent £850,000 pa
Chosen by Ross Wilkie, director (retail), Colliers International
It is significant that part of the huge Inditex group chose Glasgow’s Buchanan Street for its first UK store outside of London. Several other cities had been competing for that number two spot, including Birmingham and Manchester, so this deal shows the desirability of Glasgow as a leading retail destination in the UK hierarchy – and that is despite the fact that the Buchanan Galleries extension has been put on hold.
Buchanan Street is the jewel in the crown of Glasgow’s world-class shopping experience and big international brands are keen to be represented there. Other new arrivals have included Kiko, Michael Kors and Swatch, and the presence of such names, combined with very limited availability, mean it is hardly surprising that zone-A rents are growing to make it by far the most expensive location in Scotland. The Massimo Dutti signing is a further demonstration of how strong Glasgow is in retail terms.
Quartermile 4, Edinburgh
Type of deal Preletting
Developer Quartermile Developments
Tenant Cirrus Logic
Size 70,000 sq ft
Rent Undisclosed
Chosen by Mike Irvine, partner, Montagu Evans
Cirrus Logic’s prelet of 70,000 sq ft in Quartermile 4 resulted in the building being 100% let prior to completion, which led to implications for the city’s supply line. The requirement by the US audio and voice technology company was not widely known about and the deal came as a surprise to many.
Quartermile 4 was seen as delivering 130,000 sq ft of essential brand new, grade-A office supply and to have this taken off the market so quickly leaves a significant shortage of such stock. Quartermile 3 will deliver the next new build, but not until October 2017.
The deal is also significant in a number of other ways. It was the largest city centre prelet in more than 10 years. It is also further testament to Edinburgh’s increasingly diverse economy which, before the global financial crash, was driven by the financial sector. That is no longer the case, with other sectors, such as IT, becoming increasingly important.
Atria One and Two, Morrison Street, Edinburgh
Type of deal Office and retail investment
Vendor The City of Edinburgh Council
Purchaser Deka Immobilien
Size Circa 200,000 sq ft
Price £105.25m
Chosen by John Heaver, director, Savills
My choice of top deal for Scotland is Deka Immobilien’s purchase of Atria One and Two in Edinburgh. Located in a 100% prime location in the Exchange District they offer arguably the best office buildings in Edinburgh. They were, therefore, able to satisfy Deka’s requirements for high-quality, prime offices in leading cities. They are occupied by a strong line-up of tenants and, while the majority of the space is well let, 30% remains vacant. The leasing fundamentals in Edinburgh, which saw demand for prime office space increase by 44% during 2015, are, however, encouraging signs for both the vacant accommodation and the new owners.
Frankfurt-based Deka was also attracted to the comparable good value of such a purchase as Scotland’s investment market continues to trade at a discount to the rest of the UK.
So this deal is also significant because it continues a key trend we are seeing for increasing levels of interest from overseas investors.
EG gauges the trials and tribulations of Bristol’s property market
New goal for sports direct
In Glasgow, Sports Direct relocated to 185 Sauchiehall Street, part of the Sauchiehall Building, where KKR and Quadrant Estates were also planning new restaurants.
Murray flies out of site
JLL and Savills were instructed by Murray Estates to sell a development site adjacent to Edinburgh International Airport, earmarked for new offices, housing and hotels.
Dundee makes a splash
Dundee City Council has appointed One Enterprise and Robertson to develop schemes for its £1bn waterfront regeneration programme.
Savills recruits in Scotland
Savills has appointed investment director Nick Penny as head of Savills Scotland and BNP PRE appointed David Simpson, from Cushman & Wakefield, as director and head of property management for Scotland.
Referendum halts exchange
Aberdeen Asset Management took the £85m Exchange Place, Edinburgh, off the market until after the referendum on Britain’s membership of the EU. Apam’s plans to sell City Park in Glasgow were also put on hold.
Slippery slope for housing
House prices in Aberdeen fell by an average of 4.1% in 2015, according to Hometrack – declining oil revenues having had a major effect on employment.
7 things you need to know – vital statistics, facts and figures for Scotland
£574m
investment in £20m-plus Scottish properties by overseas buyers January 2015-16, more than 76% of such expenditure
5.3%
the rise in retail rents in Edinburgh’s Princes Street during 2015, highest increase in the UK, outside London
4.3%
office-based employment growth across Scotland’s three main centres 2015-21, representing 16,000 jobs and 1.3m sq ft new office space
£26m
the amount of Scottish property assets sold at auction by Acuitus during 2015
£1bn
the 2016 City Deal awarded to Edinburgh to promote investment, a £1.1bn deal having been awarded to Glasgow last year
£144.7m
estimated cost of extending Edinburgh’s tram from the city centre to Newhaven, 5.1m journeys having been made on the current system in 2015
£7.5bn
investment-ready development opportunities launched by the Scottish Cities Alliance at 2016 MIPIM.
Sources: Knight Frank, Cushman & Wakefield, EGi, Acuitus Scotland, Savills, STV/British Trams Online
