Following the announcement that Great British Energy will establish its headquarters in Aberdeen, interest in office spaces in the city has surged during the third quarter of 2024.
Knight Frank, a leading commercial real estate firm, reported a total of 118,210 square feet of office space was leased between July and September, marking a significant increase over the annual total.
In the first half of the year, there were 91,445 square feet of office leases, with 32,000 square feet signed in the first quarter and 59,436 square feet in the second.
The third quarter saw 21 office deals, with an average size of 5,692 square feet.
Knight Frank Aberdeen partner Matt Park said: “After a sluggish first half of the year, the drop in interest rates and the news of GB Energy’s arrival in Aberdeen have sparked renewed activity in the city’s office market, despite the price of oil falling over the course of the third quarter.
“It is notable that the size of the average deal has increased, suggesting occupiers are beginning to feel more confident about making somewhat larger commitments for the correct property.”
“We would hope to see more deals conclude by the end of year – particularly if interest rates continue on their downward trend. However, the oil price and government policy remain the key driver of office activity in Aberdeen and, with the oil price falling to a lower average during the third quarter, that may cause pause for thought among some decision-makers.”
The biggest office lease during the third quarter was OEG Offshore securing 16,591 square feet at The Stratus Building in Aberdeen Business Park, followed closely by Sword Group with a lease of 16,460 square feet at the Hill of Rubislaw.
The Grade A vacancy rate has stayed at just 2% since the beginning of the year. The supply of Grade A office space in Aberdeen is shrinking as more spaces are leased, existing buildings are converted, and there are no new speculative developments.
