Glasgow is enjoying an unprecedented period of growth and development. Having completed the major regeneration programmes that dominated the 1990s and early 2000s, the city is now fully engaged in a further phase of transformation that will ensure Glasgow maintains its status as a leading UK city and economic powerhouse.
Scotland’s largest city generated a very healthy £19.3 billion GVA in 2014, the largest of any Scottish city. Impressively, Glasgow had the fastest growing city economy in the UK in 2013-14 and is third for UK regional commercial property investment outside London (CBRE, Core Cities, Core Strengths). Figures from Quarter 2 2016 indicate that the Glasgow office market has recorded one of its best quarterly take-ups since 2008.
Glasgow has a strong, growing economy with well-established, thriving sectors and sub-sectors. Key strengths lie in Financial and Business Services/Fintech, Life Sciences, Advanced Manufacturing as well as an internationally significant retail sector. In fact, recent statistics indicate that Glasgow’s economy topped major cities in the UK for growth and recovery.
Powerhouse of the Scottish economy
EY’s Attractiveness Survey 2016 for the UK and Scotland reaffirm Glasgow’s position as a leader in FDI. Scotland itself attracts more foreign direct investment than any other UK region outside of London. Last year was also a record year for Scotland in attracting R&D inward investment, with 23 individual projects. This increased from 17 in 2014, putting Scotland in the leading position for R&D projects in the UK. As Scotland’s largest and most successful city, Glasgow makes a significant contribution to this overall success.
Glasgow has achieved an outstanding set of results in the prestigious fDi Magazine “European Cities of the Future Awards” 2016/17”. In the Large Cities categories, Glasgow was awarded: top 10 overall large city; Runner-up for FDI Strategy; Runner-up for Business Friendliness; and Top 10 for Economic Potential.
Glasgow has long been a leader of technological innovation, a trend which continues today and is apparent from the entrepreneurial nature of the business base. So much so, that Glasgow has been named European Entrepreneurial Region 2016, based on the region’s strategies, as the best to promote entrepreneurship and spread innovation among local companies.
Building on this drive to further promote innovation and entrepreneurship in the indigenous business base, Glasgow City Council has recently launched a new innovation hub, known as Tontine. Located in the heart of the Merchant City – a neighbourhood where the legacy of Glasgow’s tobacco merchants coexists with a 21st century creative district – Tontine is an acceleration and growth space for young, aspiring businesses. An ambitious project, the accelerator is expected to generate £53 million for the local economy, support 134 businesses and create 536 new jobs over the five year delivery programme.
The building has been extensively upgraded to provide high quality, flexible work spaces for growing SMEs working in enabling technologies, advanced design and manufacturing, and the creative economy.
Building the future
A key driver in the next phase in Glasgow’s growth is the £1.13 billion Glasgow City Region City Deal. The City Deal is an initiative by both the UK and Scottish governments to invest in the long-term sustainability and prosperity of the Glasgow city region. City Deal projects include enabling construction, infrastructure and connectivity projects that will physically transform the fabric of the city and wider metropolitan region over the next 20 years.
The Glasgow City Region City Deal is now coming to market seeking to lever £3.3 billion of private investment. This once-in-a-generation investment opportunity will significantly transform how the city region functions. While the programme of works has been agreed at Cabinet level and some of the projects are getting underway, there are real opportunities for investors and the Glasgow City Region City Deal partners are keen to engage with interested parties.
The City Deal will help to unlock the economic potential of the city and, as well as new infrastructure, an element of the City Deal has been earmarked to fund innovation, business growth and to support the local labour market initiatives like the Tontine. Put simply: Glasgow is consciously creating the perfect environment for your business to succeed.
Investment opportunities aplenty
Glasgow continues to welcome investment and, through Invest Glasgow, promises to work alongside investors to provide a single point of contact and to assist you from initial enquiry to dedicated aftercare.
All of the essentials for your business – a skilled and multi-lingual workforce; excellent, 21st century connectivity and infrastructure; and top-quality office accommodation – and everything that makes Glasgow great remains core the city’s offer. Glasgow will continue to be a UK and Scottish leader.
Glasgow is the commercial, retail and cultural capital of Scotland. As such, the city is experiencing significant demand for new Grade A office space, hotel and residential commensurate with Glasgow’s global reputation as a business hub, entertainment and tourism hotspot, and the UK’s best retail destination outside London.
The requirement for more large floor-plate Grade A office spaces in Glasgow remains high but a raft of newly-refurbished offices (to Grade A standard) have launched in the city and central business district in recent months, thus ensuring an excellent supply and variety of space for new or second round investors. While there is some uncertainty in the wider economy there are no indications that this will have any effect on occupier requirements.
The capital investment market in Glasgow remains buoyant with highly competitive returns on investment there for the taking. Prime city centre yield for commercial office space is 5.25% (Quarter 1, 2016) while retail yield is 4.5% and prime retail rent is £258/sqft (March 2016).
In response to the city’s growing population and in support of the drive to attract further inward investment, Glasgow City Council’s ambitious housing strategy, People Make Glasgow Home, will build 25,000 new homes by 2025. Key areas of this strategy include land release for affordable homes, helping first-time buyers access mortgages, turning empty shops into housing, and releasing 20 sites for development by housing associations. Significant investment opportunities exist for owner-occupied, social-rented, build-to-rent and student accommodation.
Glasgow had been named in National Geographic’s top twenty locations for 2016 in large part due its vibrant arts and music scene. This is complemented by the UK’s best shopping outside of London, some of Europe’s finest museums and galleries, and a thriving nightlife.
These days the name Glasgow is synonymous with world-class events and entertainment. Recent investment in event infrastructure such as the SSE Hydro and the Emirates Arena has established Glasgow as an entertainment hot-spot and a city of choice for major sporting events. In 2016, the SSE Hydro was voted world number one by Billboard and number 3 by Pollstar. Glasgow will host the MOBOs 21st anniversary later this year and will co-host (with Berlin) the 2018 European Sports Championships. A packed calendar of events and a highly successful conference and conventions market is driving up demand for more new hotels and serviced apartments. Based on current demand, Glasgow needs a further 1,000 hotel rooms on top of the 1,500 currently in development.
There is a critical mass of expertise, passion and innovation in Glasgow today. Coupled with 21st century infrastructure and significant and sustained investment there is no reason to doubt that Glasgow will continue to be at the forefront UK growth and innovation. Choose Glasgow and you’ll be in excellent company.
For more information visit: investglasgow.com