According to real estate adviser CBRE, the coronavirus interrupted a busy start to the year for transactions in the booming office market in Aberdeen.
The largest of 19 first-quarter transactions was Equinor adding 15,000 square feet of office space to its existing base in The Forecourt Office at Prime Four. The Norwegian oil major now occupies 60,000 square feet.
But CBRE has warned that the effects of the pandemic on business and the dramatic drop in oil prices are likely to cause the housing market to slow.
There was a total use of 170,500 square feet from January to March, an increase of 362% compared to the same period for 2019 and an increase of 72% compared to the five-year average for the first quarter.
Most of the transactions, averaging 9,000 square feet, involved Category A offices.
Ponticelli subleased 10,000 square feet to the Rever Offshore office at Atmosphere 1 in Westhill, following contracts won with Total. In the city center, Neo Energy has moved from a 6,000 square foot suite to the eighth floor of the Silver Fin building to occupy the entire upper level of 12,700 square feet.
In the West End, Global E&C signed for 10,000 square feet at 27 Albyn Place and Bank of Scotland took 7,000 square feet at 33 Queens Road.
In Dyce, Stork bought Aker Solutions’ former headquarters, The Quad (55,500 square feet), for owner occupation at auction and Alba Gate (approximately 28,000 square feet) formerly occupied by Helix, sold to Alba Gate Developments.
Supply in the city stands at 2.4 square meters – a drop of 15% compared to the same period last year.
Amy Tyler, land surveyor at CBRE in Aberdeen, said: “It was a very encouraging start to the year, with a healthy final turnout despite a number of transactions reported in recent weeks.
“Activity in the first quarter before the break in activity triggered by the coronavirus pandemic shows that interest in peripheral locations and downtown Category A stock remained strong.
“For the second quarter, the impact of the pandemic on the energy sector as well as a significant drop in the price of oil should affect the market. We expect that the majority of new business will be concentrated on occupants restructuring their leases rather than on new transactions. ”
CBRE works to align office rentals during foreclosure using virtual visualizations.
Tyler added: “For the duration of the lockout period, we are able to offer customers the use of our internal viewing tool, Floored Plans. This allows us to present a space using interactive 2D and 3D immersive views, with the possibility of modifying the layout during virtual visits with instant results.
“This technology is a great way to ensure that potential tenants are always looking at our clients’ properties and we will continue to offer it to clients for free until physical visits become possible again.”