An Aberdeen property expert has revealed why more than one-third of the city’s take-up from industrial occupiers last year were in the Energy Transition Zone (ETZ).
Knight Frank said 97 deals were concluded in 2024, with the total space amounting to 768,000 sq ft.
The ETZ saw a take-up of more than 272,000 sq ft, 35% of Aberdeen’s total.
Knight Frank industrial agent David Gavan expects the “hot demand” to continue in Altens, which has overtaken Westhill and Dyce as the number one desired location for most of his clients.
He believes the ETZ is “rejuvenating the city’s southside” and helped to deliver the third best year of the last decade.
‘There’s plenty of opportunities’
The Energy Transition Zone comprises a 250-hectare site in close proximity to the brand new £420 million Aberdeen South Harbour.
It initially enabled 40 hectares of “premium development opportunities” through a combination of revitalised commercial properties.
Mr Gavan said there are a number of reasons for the popularity of Aberdeen’s ETZ which has “transformed commercial property” in Aberdeen.
He said: “Since the south harbour has opened there has certainly been an increase in activity across different industries.
“Being located between the old and new is attracting people, which we weren’t seeing before the creation of the ETZ.
“The property improvement fund, tax incentives, green project funding and strategic partnerships.
“The feedback from occupiers is all of the above benefits are driving them to the area.”
Mr Gavan believes attention has moved away from the likes of Westhill and Dyce, which were previous hotspots, in favour of Altens and the ETZ.
He added: “More often than not the requirement for clients is now to find somewhere in Altens.
“It’s changed the image of the area and the work which has been done has had a tangible impact.
“The hot demand will also continue. There is a push to ramp up what’s currently been done.
“There’s still around 500,000 sq ft left in the area so there’s plenty of opportunities left in the area for businesses and developers.
“The ETZ has had strong backing and the market data is stressing the trend will continue.
“With the supply of good quality space tightening and occupier expectations rising, competition for the best stock is intensifying.”
Aberdeen ETZ Knight Frank research
The take-up in 2024 was the third strongest since 2015, only beaten by a post-pandemic surge in 2022 and 2023.
Availability of space fell to below two million sq ft for the first time in recent years.
Dyce has the highest share of vacant space at 31%, while Altens and East Tullos saw 23%.
Westhill continues to be “one of the most popular” industrial locations in the region, with historically low vacancy figures.
Created in 2021, the ETZ aims to support Aberdeen and the wider region’s energy supply chain, delivering new and brownfield development sites through a coordinated revitalisation of the existing industrial estates at Altens and East Tullos.
Before the formation of the zone, these areas accounted for an average of 22% of take-up, which has since seen a 45% increase according to Knight Frank.
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