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The Glasgow City Centre office market is set to achieve record-breaking annual take-up this year with over 1 million sq ft of take-up according to global property advisors, Cushman & Wakefield.
Whilst these impressive take-up figures might break all-time records, 2018 will more importantly be remembered as a transformational year for Glasgow and in particular the International Financial Services District (IFSD) according to Fergus Maclennan of Cushman & Wakefield.
Since the launch of the IFSD project in 2001, driven by a partnership between public and private sectors, the area defined as the IFSD between St Vincent Street and the River Clyde has attracted major occupiers such as JP Morgan, Morgan Stanley, Esure, Barclays and Hymans Robertson.
Following the global financial crisis of 2007-2008, investor and occupier confidence has returned to Glasgow’s IFSD with significant pre-let activity and ambitious development plans set to further enhance the area. This comes on the back of a strong 2017 when Morgan Stanley moved into their new 154,814 sq ft building on Waterloo Street and both the Scottish Courts & Tribunal Services and Department of Work & Pensions moved to 80,498 sq ft and 84,542 sq ft respectively at Atlantic Quay on the Broomielaw.
2018 has so far brought three major deals to the area with the Government Property Unit (GPU) committing to 187,205 sq ft at BAM Properties / Taylor Clark Properties’ Atlantic Square development which is now under construction on York Street. Scottish developer, HFD Group plan to start their equally impressive 177 Bothwell Street with Clydesdale Bank committing to a 110,955 sq ft pre-let for their new Glasgow HQ.
The Tradeston area on the southbank of the River Clyde will be transformed by Drum Property Group’s £350 million mixed-use scheme delivering 1 million sq ft in 2020. Securing Barclays Bank as an anchor occupier for their new 470,000 sq ft purpose built campus to accommodate approximately 5,000 staff is a massive coup for Glasgow which will regenerate this waterfront site. Barclays are reported to have an option to further extend their campus by an additional 210,000 sq ft in a second phase of the development.
Fergus Maclennan, office leasing specialist at Cushman & Wakefield commented “Despite being 5 minutes walking distance from Central Station, the southbank of the River Clyde has always suffered from being completely detached from the central business district. The River Clyde has been a barrier rather than a feature to draw on which is frustrating when you consider the successful riverfront revitalisation projects in other European cities with similar industrial pasts. Finally Glasgow can transform this area into a commercial hub to extend the IFSD south of the river and draw on the excellent connectivity links.”
“With over 850,000 sq ft of live occupier requirements including significant HQ buildings, we anticipate further pre-let activity in Glasgow City Centre moving into 2019 with the IFSD certain to land the majority of these. Vacant sites and derelict buildings which have made the IFSD project seem piecemeal to date will finally be unlocked with impressive development blocks and streetscape improvements underway.”
Investor confidence has returned to Glasgow with exciting development plans within the IFSD. Fore Partnership are the first to commit to speculative development with CadWorks, a 94,000 sq ft Grade A office building offering 10,000 sq ft floor plates on Cadogan Street. Demolition works have now commenced with the new development set to complete in October 2020.
M&G Real Estate unveiled plans earlier this year for The Grid, a £100 million office development at 33 Cadogan Street which will provide 277,500 sq ft over 12 levels. Demolition works are set to commence shortly with a construction programme of 30 months.
Another eye sore at the former ‘What Every Woman Wants’ department store on Argyle Street, which has been derelict for nearly two decades is also set to be transformed with detailed planning permission submitted by Osborne + Co to develop a 280,000 sq ft office building branded One Central, with a target completion date of 2021.
Another exciting initiative to transform the appearance of Glasgow City Centre is the £1.8 million ‘Avenues’ project committed as part of the £1.13 billion Glasgow City Region Deal. The project’s aim is to transform the streetscapes of the City Centre and how those who live, work and visit Glasgow experience them. Fergus Maclennan added “The ‘Avenues’ project combined with the increased investment from the private sector will be another catalyst for future development. Streetscape improvements on Argyle Street will improve connectivity for cyclists and pedestrians whilst creating a cleaner and safer environment for Glasgow and it’s people to enjoy.”
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