Edinburgh office market makes 'encouraging start' to 2021 despite seismic impact of pandemic
Edinburgh’s office market got off to a “positive start” in 2021, with several key lettings taking place in the opening three months, new analysis has shown.
Property firm Knight Frank said that some 90,000 square feet of office take-up was transacted in the first quarter across the capital. This compared to 99,000 sq ft in the closing quarter of 2020 and 68,915 sq ft during the same period a year earlier.
Among the deals concluded between January and March 2021 was Motorola taking 10,844 sq ft of office space at Caledonian Exchange, on which Knight Frank represented the landlord.
Other significant deals included Trustpilot taking 9,500 sq ft at 28 St Andrew Square and MacRoberts, the law firm, securing 6,500 sq ft at 10 George Street.
Demand for office space in the city has remained robust throughout the pandemic, property experts noted – with some 500,000 sq ft of requirements still on the market despite the shift to home and blended working practices.
The development pipeline has, however, continued to be restricted, with 281,000 sq ft of new space under construction.
Last year, Edinburgh saw 490,585 sq ft of take-up and a new headline rent of £37 per sq ft was set in the city, despite the economic uncertainty caused by the pandemic.
Simon Capaldi, office agency partner at Knight Frank Edinburgh, said: “While much of the economy remained shut down, it has, nevertheless, largely been an encouraging start to 2021 for Edinburgh office take-up.
“Some of the larger deals this quarter were held up due to ongoing uncertainty, but their conclusion is indicative of pent-up demand and, with many businesses beginning to re-open and schools returning, there is an air of positivity.
“Part of that is because there is still a steady stream of active requirements coming from companies as they start to look beyond Covid-19. Even though few people have spent much time in an office in the last 12 months, they are still playing a central role in many occupiers’ strategies.
“If anything, the flight to quality that took hold last year has only increased as occupiers look to best-in-class space to accommodate the return of staff and provide them with the working environment they need.”