Overall UK investment in industrial property down 60% on last year as take-up drops back to Q2 2009 levels
Industrial property take-up in Scotland in the first quarter of 2012 dropped to the lowest figure recorded since 2009 a new survey suggests.
Property agent DTZ's Property Times UK Industrial Q1 2012 report shows take-up of commercial property over 50,000 sq. ft in Scotland dropped to just 250,000 sq ft in the first quarter of 2012.
The take-up figure in the first quarter of 2012 was down by more than 50 per cent on previous quarterly averages.
UK-wide, investment activity has dropped by more than 60 per cent to £620 million in the first quarter.
The report found that compared with Q4 2011, UK industrial take-up in the first quarter of the year fell by 1.9 million sq ft to 5.8 million sq ft, the lowest quarterly level since Q2 2009 and almost 20% below the quarterly average.
This is reflected in the total number of transactions, down to 49 compared to 60 in the first quarter of 2011.
The rental outlook for the first quarter was similar to the last quarter of 2011, with levels remaining flat and agents reporting a hardening of incentives on smaller prime units.
Rental growth forecasts have also been revised down, largely due to downward revisions to the economic forecasts.
Peter Fraser, a senior surveyor with the industrial agency at DTZ, said: “Following a strong 2011, Q1 take-up in Scotland reached a disappointing 250,000 sq ft, less than 50 per cent of the quarterly average.
“Just two lettings above 50,000 sq ft took place, the largest being Diageo taking 181,000 sq ft of space at Grangemouth.
“Following news of the creation of Enterprise Zones in Nigg, Port of Leith and Dundee Port, Spanish renewable company, Gamesa has pledged to create 850 manufacturing jobs in the area.
“The market will be watching with interest as to how this inward investment translates to take-up in the coming months.
Fraser added: “Whilst there was little transactional activity recorded above 50,000 sq ft this quarter, there has been relatively good levels of activity for smaller sized units across Scotland.
“There appears to be a consensus amongst occupiers that the economic climate is reaching its lowest point; companies are therefore projecting business growth and, with opportunities to secure good deals, this confidence is converting into relocations to more suitable accommodation.”