A 48-acre Edinburgh development site has sold for 50 per cent over estimate, reflecting the strength of Scotland’s recovering property market.
Jones Lang Lasalle had valued the 48-acre plot and an adjacent 60,000sq ft building at £10m in response to offers it received in 2012. Recent interest from property firms and sovereign wealth funds resulted in a sale for £15m. The unconfirmed new owner is thought to be investment firm Parabola.
The site had belonged to New Edinburgh Limited, set up in 1990 to build the Edinburgh Park office development at Gyle as a fifty-fifty venture between the Miller Group and CEC Holdings Ltd, a subsidiary of the city council. It was responsible for the construction of 1.3msq ft of office space but collapsed owing the Lloyds Banking Group about £19m in loans. Now in administration, the land and offices were its only assets.
“We had a lot of interest in this opportunity, which reflects how the commercial property market has come back, and how active Edinburgh Park has been,” explained JLL director, Cameron Stott.
Rising city centre prices — and the fact that the capital’s long-awaited trams will stop at the business park and shopping centre — have meant investors and tenants were increasingly looking at the Gyle area. When it finally becomes operational next year Edinburgh’s tram line will have three stops at the Gyle shopping centre and business park.
Parabola is not expected to develop the land immediately, although outline planning permission already exists for offices. Stott said the new owner would probably “pause for breath” and review the situation given the new surge of interest in the park, before making any decisions on development.
The initial phase of the nearby West Edinburgh Business Park is expected to be completed late next year. Its progress has spurred pensions and benefits firm JLT Employee Benefits and Sainsbury’s Bank to secure offices in the area which is predominantly a business orientated mix of office buildings and modern industrial warehousing.
Under construction on the former Pentad site to the south of South Gyle Crescent, Phase One consists of more that 26,000sq ft of industrial space in two terraces with unit sizes ranging from 3,200sq ft and upwards.
Kirsty Palmer is an associate director at Jones Lang LaSalle “As the first speculative industrial development of its kind in Edinburgh since 2008, West Edinburgh Business Park offers a strong signal of optimism in terms of market demand for industrial space in Edinburgh,” she said.
“We are confident that occupiers will be attracted by the flexibility, location, and quality of these competitively priced units.
“Located in one of Edinburgh’s most popular out of town business hubs, the finished development will open up a range of opportunities to new and existing businesses in the area, so we’re expecting demand to be high.”
