During 2011, a string of high profile deals helped cement
Glasgow's position as one of the UK's most attractive cities for
national and international property investors and developers.
Pramerica Real Estate Investors acquired 141 Bothwell Street, a
175,000 sq ft Grade A office building in the IFSD from Strathclyde
Pension Fund, for around £70 million.
Friedrich von Carlowitz, Portfolio manager of Pramerica,
said, "We believe that the Glasgow office market offers one of the
best risk-return-profiles in UK right now, and, with a relatively
small amount of Grade A space available, this deal represents
excellent value which we are confident will generate good returns
on behalf of our investors."
In December 2011, Abstract (Glasgow) Ltd - a wholly-owned
subsidiary of Abstract Securities Ltd - announced it had acquired a
site at St Vincent Street, Glasgow, to build 170,000 sq. ft. of
'Grade A' office space, speculatively.
Mark Glatman, Chief Executive of Abstract Securities, said:
"Glasgow has changed considerably in the last few years to become a
cosmopolitan city with a great workforce and a high standard of
living. It has a strong pool of graduates and a proactive business
environment, with funding initiatives such as RSA grants making it
a very attractive business location. With tight design and
procurement we are able to bring this building to the market
quoting rentals from £23 per sq ft significantly undercutting the
established Glasgow market to deliver a top quality building at a
competitive price. We have absolute confidence that our product is
in the right place, at the right time and at the right
cost."
In August property investment manager Tristan Capital Partners
backed its confidence in the future of Glasgow's office market,
with the purchase of the newly developed Cuprum building in the
IFSD for around £23 million.
Cameron Spry, Partner, Head of Investments for Tristan
Capital said: "We believe that the acquisition represents a
compelling core plus investment because it's underpinned by solid
current income and the potential for increasing value, due to the
improving occupancy fundamentals in the Glasgow market."
In January 2011, Union Investment acquired the Equinox Building
in the IFSD, its first UK office investment outside London, for its
open-ended real estate fund niImmo:Deutschland.
Dr. Karl-Joseph Hermanns-Engel, a member of the management
board of Union Investment Real Estate GmbH, said, "As Scotland's
business centre, Glasgow is at the forefront of the prime UK
regional markets that we've been monitoring for some time now, as
part of our core strategy and in order to diversify the fund.
Compared to London, Glasgow is characterised by exceptionally low
market rent volatility. For that reason, investment in Glasgow
should focus strictly on office properties let on long-term
leases."