Glasgow Commercial Property Hits Five-Year Leasing High, Sparks Development

Glasgow’s commercial property market is showing the strongest activity in years, with new figures revealing a sharp rise in office leasing and a landmark deal for a portfolio of city-centre assets. The data, covering the first quarter of 2026, points to a tightening supply of prime space that could drive further development in the months ahead.

Office Leasing Surges to Highest Level Since 2021

City centre office leasing reached 230,000 sq ft in Q1 2026, according to data from CoStar reported by the BBC and other sources. That represents an 85% surge from the previous quarter and the highest quarterly absorption since 2021. For context, total office take-up across 2025 stood at 452,000 sq ft, 3% above the five-year average, despite a slight year-on-year decline. The momentum so far in 2026, if sustained, would comfortably exceed last year's totals, underlining renewed confidence among occupiers.

Rents Climb as Supply Tightens

Supply shortages are pushing rents higher across both office and industrial sectors. Headline city centre office rents have reached a new high of £41.50 per sq ft, while prime industrial rents have increased to approximately £12.50 per sq ft, according to the Glasgow Chamber of Commerce. These levels reflect limited availability of Grade A space, particularly in sought-after locations such as the core financial and retail districts. The trend is encouraging developers to look at both new-build projects and refurbishments of older stock.

Landmark Deal Reshapes Key City-Centre Portfolio

A significant transaction has further underscored investor appetite for Glasgow. Lothbury Investment Management has agreed a £17.4m deal to purchase a portfolio of properties on Buchanan Street and Exchange Place from Lynett Leisure, a property cluster that includes the Rogano restaurant, one of the city's most well-known dining venues. The acquisition signals confidence in the long-term value of prime retail and hospitality assets in the heart of Glasgow, even as the broader retail landscape adjusts.

Vacancy Rate Remains High Despite Activity

Despite the surge in leasing, the overall vacancy rate in Glasgow remains elevated at 12.4%, with the city centre specifically sitting at 15.8%. That relatively high level of empty space is partly a legacy of the pandemic-era shift to hybrid working, which left some older office buildings underused. However, the recent leasing figures suggest that modern, well-located space is being absorbed quickly, while secondary and outdated properties struggle to attract tenants. This divergence is likely to shape investment decisions: developers are expected to focus on upgrading or repurposing older buildings, rather than building new speculative stock.

For now, the strong take-up and rising rents provide a solid foundation for new projects, particularly those that can deliver flexible, sustainable office environments. If the current pace continues, Glasgow could see a fresh wave of commercial developments aimed at meeting demand for high-quality space in a market that, for the first time in years, is clearly short of supply.

This article is general information only and is not personal financial or investment advice. Consider your own circumstances and seek licensed professional advice before making financial decisions.