Glasgow’s office market is facing an acute crunch, with demand for quality space far outstripping supply and leading to a dramatic increase in lease renewals and re-gears as businesses scramble to secure their premises.
Office lease extensions and reconfigurations surged in Glasgow’s city centre during the initial half of 2025, as businesses reaffirmed their commitment to current office locations due to remarkably low levels of prime office availability.
Insights from CoStar Group indicated that 14 such transactions were documented in the first six months of this year, rising from eight the previous year and doubling the amount recorded over the last decade’s first half-years.
Despite an overall increase in availability in central Glasgow by one-third since early 2020 to 2.5 million square feet, the stock of five-star rated office space has decreased to 125,000 square feet, marking its lowest point in recent times.
Prior to the last development cycle, prime office space dwindled to 150,000 square feet. The completion of speculative projects at 177 Bothwell Street, Cadworks, and 2 Atlantic Square subsequently raised this figure to approximately 450,000 square feet by mid-2022. However, supply has been on a downward trajectory since then, prompting many tenants to reaffirm their leases in existing spaces.
Lloyds’ five-year extension of its lease at 110 St Vincent Street was the largest transaction of this nature in the first half of 2025. Covering 97,000 square feet, it represented nearly half of the total square footage renewed or reconfigured.
Deloitte’s choice to reconfigure its lease at DWS’s decade-old 110 Queen Street was another significant agreement. The revised lease will end in December 2030, with the previous break option eliminated.
Recent lettings in that area have achieved £33 per square foot, reflecting rental growth in the finest four-star office spaces from earlier development cycles. Capella, a four-star building established over 15 years ago, welcomed IT company Atos and the Strathclyde Pension Fund, each taking around 11,000 square feet in the first months of this year.
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Other public sector organisations have also renewed or reconfigured leases recently, with Healthcare Improvement Scotland and the Scottish Children’s Reporter Administration committing to 16,000 square feet and 13,500 square feet at Delta House and Merchant Exchange, respectively.
Proposed large office developments in Glasgow include CEG’s iQ building at 33 Cadogan Street, which could add nearly 300,000 square feet of essential office space to the local market.
Nevertheless, there are currently no major new office projects underway, as viability continues to be hindered by high construction costs, suggesting that the trend towards renewals and reconfigurations is likely to persist.
