Total transactions during the first quarter of 2016 reached just 34,624 sq ft in Aberdeen, which was the second lowest level in the past ten years as the low oil price continues to impact on demand.
The largest transaction to take place in quarter 1 saw the Crown Office and Procurator Fiscal Service acquire 10,537 sq ft of refurbished space at AB1 on Huntly Street. Further positive news was recently announced with PwC acquiring the 10,040 sq ft top floor of The Capitol, a recently completed speculative city centre office development.
Despite the lower levels of demand witnessed recently, small increases in Crude prices to c.$40, since a low of c.$33 in January, have signalled a more optimistic picture for the year ahead.
Total available supply at the end of the first quarter reached a new high of 2,029,122 sq ft; this represents a year-on-year increase of 59% from the first quarter of 2015 and a quarter-on-quarter increase of just under 11% from Q4 2015.
Prime headline rents in Aberdeen are once again unchanged at £32.00 per sq ft, however the details of the PwC letting remain confidential. As yet there are no signs that headline rents for prime Grade A space have suffered due to the low oil price and are forecast to remain stable throughout the course of the year.
Derren McRae, managing director of CBRE in Aberdeen, said: “Despite the drop in oil price impacting on the general demand for office space, prime headline rentals levels have remained stable. The recent announcement of PwC acquiring space within The Capitol demonstrates that occupiers with lease events are likely to gravitate towards the new high quality office space coming to the market.”