Glasgow’s office market is experiencing a sharp squeeze of prime space and record spikes in lease renewals and re-gears, reshaping occupier decision-making and investment strategies across Scotland’s commercial real estate sector. With supply of high-quality, sustainable space falling below critical thresholds, occupiers and landlords are rapidly adapting to a new market reality characterised by premium rent escalation, “wait and see” leasing behaviour, and fierce competition for best-in-class assets.

Acute Supply Shortage

Glasgow city occupier demand stands at around 750,000 sq ft, while just 200,000 sq ft of "prime" space is actually available, a gap highlighted by David Cobban, Head of Savills' Glasgow office in Glasgow Bell. The true Grade A vacancy rate has dipped below 2% for the first time since 2022 according to JLL Office Q2 2025 market update. Despite high total vacancy (up to 8%), the majority is seen in outdated or neglected stock, not in desks that progressive corporate tenants are seeking. The development pipeline for prime offices remains thin, and ongoing projects are unlikely to keep pace with demand from Glasgow’s professional and finance sectors.

Lease Renewals and Re-Gears Surge

In response to limited choice and escalating rents, prime rents now approach or exceed £41.50 per sq ft and grew 5.1% annually. Many occupiers, including leading firms, are prioritising lease renewals and re-gears over relocation. Over 60% of Grade A office transactions in Glasgow during the first half of 2025 were renewals or re-gears, as occupiers responded to supply constraints by opting for short-term extensions and retention of quality space according to a recent CoStar report. This behaviour allows tenants to maintain business continuity and avoid compromising on quality, even as landlords benefit from stable rental income streams and stripped-down legal processes.

Notable Glasgow Buildings Impacted

110 St Vincent Street

The Bank of Scotland agreed to a five-year lease extension for its headquarters. It is Glasgow's most iconic, Grade A, seven-floor building that has been refurbished and managed by Hines/Helix. This renewal was a direct response to scarcity of prime offices in central Glasgow.

Aurora, Bothwell Street

Widely reported as Glasgow’s “most sustainable” office, Aurora has seen high lease take-up immediately after reopening, with major occupiers including PwC and Cubo securing deals. Over one-third of the building was let within two months of launch, reflecting clamour for ‘prime’ buildings.

Cadworks, West Campbell Street

The fifth floor of Cadworks was leased to Savills for 10,800 sq ft in Q2 2025, underscoring demand for high-quality, modern space. The building also adjoins a former city centre office block now slated for student accommodation due to obsolescence. This reflects shifting occupier requirements and the drive to regenerate underperforming assets

191 West George Street

Beam Suntory signed for the fourth floor (15,031 sq ft), part of a wave of sub-3,000 sq ft and larger deals in sought-after city locations.

151-155 St Vincent Street

Addleshaw Goddard completed a lease for the fourth floor (11,648 sq ft) in Q2 2025, reflecting continued interest from professional services firms.

Capella Building, 60 York Street

Prime Grade A offices with flexible/open plan space and recent deals for up to 22,000 sq ft, positioned in one of Glasgow's most prominent locations.

Implications for Tenants and Landlords

Cost pressures and rent acceleration

With prime rents growing by over 5% annually, tenants are bracing for hikes and landlords are better positioned to command higher prices for remaining top-tier assets.

Incentives and negotiations

Re-gears often now feature rent-free periods, landlord capital contributions, and refurbishment packages, reflecting rapidly shifting tenant priorities.

Sustainability and wellness

Occupiers demand modern, ESG-forward space and reject older, non-prime stock, accelerating the “flight to quality”.

Tacit relocation

Scottish property law’s tacit relocation means expiring leases may automatically roll over, providing tenants continuity but limiting landlord flexibility unless break clauses are exercised.

Investment and Market Outlook

Despite supply constraints and investment barriers, Scottish commercial property transactions rose by 33% year-on-year in early 2024, and Glasgow remains a top-ranked city for investment readiness, driven by innovation and pro-business policy. According to CBRE’s mid-year review, there is projected to be continued rent growth, urgent refurbishment cycles, and rising demand for creative lease structures like re-gears until new supply comes online.

Actionable Recommendations

For occupiers

Start strategic lease discussions early and consider capitalising on re-gears to secure business continuity, cost-effective rent adjustment, and improved fit-out standards.

For landlords

Accelerate refurbishment of secondary assets to meet “flight to quality” demand, leverage re-gear incentives, and prepare for active negotiations around renewals, break terms, and fit-out investment.

For investors

Target development and repositioning opportunities, particularly in Glasgow’s city core, as demand for sustainable, best-in-class space continues to outstrip supply and drive long-term rental growth.

Glasgow’s office sector faces a pivotal moment, one shaped by acute supply-side constraints, dynamic occupier shifts, and an urgent industry need for innovation in both leasing structures and asset modernisation. Industry leaders navigating this challenge will be defined by agility, proactive deal-making, and deep understanding of evolving tenant priorities.

Action Steps

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Acute Supply Shortage

Lease Renewals and Re-Gears Surge