Share

Aberdeen revealed as UK hotspot for office space take-up

Demand for office property in Aberdeen is among the highest in the UK, according to a report by property consultancy Knight Frank.

The firm’s market review for Q3 reveals that office space take-up was greater than that of Birmingham, Manchester Edinburgh and Glasgow. Demand for property in the city during the first three quarters of 2011 was also higher than figures recorded for the whole of 2010.

In addition to the exceptional take-up in the first six months of 2011, total demand for Q3 was 90,515 sq ft. Total active demand for office space in the city is circa 425, 000 sq ft; an increase of almost a third on Q2 levels.

Katherine Monro, partner at Knight Frank’s Aberdeen office, attributes the increase in demand to developments in the North Sea oil and gas industry.

She said: “2011 is proving to be an exceptionally successful year, with take-up already well ahead of 2010 figures. Aberdeen’s long term prospects have been significantly boosted by the UK government’s backing of the exploration of untapped oil fields to the west of Shetland, which is likely to create 3,000 new jobs and a future commitment of up to 40 years in the region.

“Furthermore, a number of oil and gas companies have each expressed an interest in office space of about 100,000 sq ft in the proposed Drum Property Group’s Prime Four development at Kingswells. This adds more weight to the likelihood that demand will continue to outweigh supply.”

Notable deals announced in the report for Q3 include the lease of the remaining 40,369sqft at Northpoint, Bridge of Don, by ITS Testing Services and Global Maritime Scotland’s lease of the remaining 5,200sq ft at Johnstone House in the city centre’s Rose Street, for a headline rent of £24.50 per sq ft.

Mrs Monro added: “Demand for Grade A office space in the city centre remains at a critical level, with just 36,000ft currently available. The proposed demolition of the former offices of Aberdeen City Council at St Nicholas House will go some way to alleviating this deficit, whilst the refurbishment of Queen’s House on Queens Road, now under offer, will continue to put an upward pressure on headline rent.”

132 views