Aberdeen recorded its highest level of commercial property investment since 2018 in the six months from January to June, according to the latest data from Knight Frank.
Analysis of RCA data by the independent commercial property consultancy found that £181 million was invested in Granite City commercial property in the first half of 2024. This is more than double the £78 million recorded in the same period in 2023 and well above the average of £99 million over the past five years.
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Lone Star Property Fund's £111m acquisition of Union Square accounted for the majority of investment in Aberdeen, with retail accounting for two thirds (67%) of the total over the six month period. Industry was the second most active sector (15%), with hotels in third place (13%).
Aberdeen accounted for almost a quarter (24%) of total investment into Scotland in the first half of 2024. International investors were the most active buyers, accounting for 62% of investment value.
Alasdair Steele, head of Scottish commercial at Knight Frank, said: “Deal activity has generally slowed due to uncertainty about when interest rates will be cut, but Aberdeen's investment market has remained relatively strong, supported by the sale of Union Square. Aberdeen has also seen reasonable activity in the industrial and hotel sectors. More generally, market sentiment is cautiously optimistic and we expect activity to pick up in Aberdeen and across Scotland over the next six months.”
Matt Park, partner at Knight Frank Aberdeen, added: “Aberdeen's occupier market is recovering from the pandemic-era slump and settling into more stable levels of activity. This is also starting to filter through to the investment market and, although the first half of 2024 may have been skewed by the sale of Union Square, we are seeing increased interest in other assets on the market, particularly those with redevelopment potential and opportunities to add value through strong asset management.”