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Scottish commercial property investment drops

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Scottish commercial property investment drops

Investment in Scottish commercial property dipped during the first six months of 2024, as uncertainty over interest rates caused investors to take a pause for thought in the second quarter.

That’s according to commercial property consultancy Knight Frank’s analysis of RCA data, which found that nearly £750m was invested in Scottish commercial property between January and June 2024.




While this was down 19% on the £922m in the same period last year and 22% below the five-year average of £954m, it was more than double 2020’s £447m.

Retail property accounted for the majority of investment by sector type, with a 51% share of the total volume. Hotels made up another 19%, while offices and industrials accounted for 16% and 10% respectively.

Real estate investment trusts (REITs) and listed property companies were the most active buyers, with a 32% share of investment volumes. International investors accounted for another 30%, while private capital made up another 20%.

Despite the overall fall in investment volumes, Knight Frank said there had been a recent pick up in activity, with its capital markets team having recently completed on a flurry of deals totalling well over £100m.

These included the sale of Edinburgh’s 40 Torphichen Street, and in Glasgow the acquisition of 1 West Regent Street and a deal for a large multi-story car-park.

Total investment in Scottish commercial property, H1 2020-2024(Image: Knight Frank)

Alasdair Steele, head of Scotland commercial at Knight Frank, said: “At the start of 2024, it looked likely that interest rates would be cut at least once in the first six months of the year and, as a result, we had a much stronger Q1 than 2023.

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