Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner. Facebook Messenger An icon of the facebook messenger app logo. Facebook An icon of a facebook f logo. Facebook Messenger An icon of the Twitter app logo. LinkedIn An icon of the LinkedIn logo. WhatsApp Messenger An icon of the Whatsapp messenger app logo. Email An icon of an mail envelope. Copy link A decentered black square over a white square.

Commercial property: Experts predict greater investor interest in Aberdeen

More stable oil prices are expected to boost the appetite for investment in the Granite City.
More stable oil prices are expected to boost the appetite for investment in the Granite City.

Commercial property in Aberdeen will attract more investor activity during 2022, a market review has predicted.

Property advisory firm Lismore Real Estate Advisors said investors may start to revisit the Granite City market this year.

It added: “Good levels of interest for quality assets in the retail warehousing and industrial sectors will continue.

“With the oil price looking more stable, the occupational market is showing early signs of improvement and we anticipate opportunistic buyers being tempted by the right building, with quality tenants and the right price.”

Increased investment

New figures from Lismore show investment in Scottish commercial property jumped by 24% in volume terms during 2021.

The total value of deals struck north of the border rose by around £300,000 to £ 1.345 billion, the firm said in its latest quarterly review.

This was despite ups and downs faced amid the Covid-19 pandemic that year, it added.

“Investors continue to grapple with offices, other than those of the very best quality or which can be adapted to meet more challenging ESG credentials.”

Chris Macfarlane, Lismore Real Estate Advisors.

The emergence of the Omicron variant and the return of restrictions continue to bring challenges across the entire property market and global economy.

But Lismore said quarter four trading “remained strong”, with volumes up 27% year-on-year, and worth a total of £520m.

The figures came as Edinburgh-based Lismore revealed its top six Scottish investment market predictions for 2022, based on research.

It predicted the top three performing sectors in 2022 will be retail warehousing, distribution and multi-let industrials.

Support for food stores has “fallen significantly”, Lismore said.

Offices struggle to attract interest

The office sector was the most poorly backed by survey respondents, with concerns over capital expenditure (capex) requirements and future working habits mentioned cited as headwinds.

On the Q4 performance, Lismore director Chris Macfarlane said: “The wall of overseas capital chasing stock continued, and pricing reached pre-pandemic levels in the food stores, logistics and retail warehousing sectors.

“However, there are challenges remaining for significant parts of in-town retail/leisure.

“Investors continue to grapple with offices, other than those of the very best quality or which can be adapted to meet more challenging ESG (environmental, social, and governance) credentials.

The strongest, well-located assets have seen occupancy levels recover.”

“When looking at themes, one part of the market which was hit hard initially but which has rebounded – in part – very strongly is the alternatives sector, covering PBSA (purpose-built student accommodation), management contract hotels and serviced apartments.

“The strongest, well-located assets have seen occupancy levels recover and while net operating income might not be quite back, investor interest has been stirred by their resilient qualities.”

Chris Macfarlane.

Mr Macfarlane added: “UK institutional activity remains very focused on longer income defensive stock including retail warehousing and distribution.

“Overseas investors continue to target Scotland, Edinburgh in particular, with buyers from the Middle East and mainland Europe all remaining active.

“But the overwhelming weight of capital has been from North America.

“The level of distressed selling continues to be very limited, with the more opportunistic buyers looking further up the risk curve, either direct development, vacant buildings or shopping centres.”


Lismore’s top six Scottish investment market predictions for 2022

  • A trend for “off-market” acquisitions will continue – Lismore says buyers are prepared to pay “premium pricing” for the best stock to avoid competition.
  • A greater weight of overseas capital will invest in a Scottish market described as “an attractive and safe destination”.
  • The current gap between prime office yields and the rest of the market will widen as occupiers and investors become “ever more exacting” in their ESG requirements. Top-tier buildings meeting the highest standards will command premium pricing, while mid-tier offices requiring significant capex “will also present opportunities”.
  • Glasgow will overtake Edinburgh in office investment volumes.
  • Aberdeen will see improved investor activity.
  • The leisure market will be “one of the most interesting” during 2022 – the best city centre bars and restaurants are “likely to see a strong bounce-back”, while out-of-town markets, roadside and drive-thru operators “continue to thrive”.

New home for Aberdeen lifting specialist LMS

Lismore review shines a light on sustainability factors in the markets