Glasgow and Edinburgh shine as prime retail hubs – Daily Business

Glasgow has defied those who say the city centre is struggling by achieving the highest retail rental rate in the UK outside London.

It has beaten last year’s £295 per sq ft for top quality (prime) rent by crossing the £300 threshold in the early months of 2025, according to data from property consultancy Knight Frank.

Edinburgh has been catching up at £280 per sq ft – a 24.4% year-on-year rise. However, the capital still has the lowest volume of shops among the UK’s major conurbations at 2.12 million sq ft , despite the the opening of the St James Quarter in June 2021, which added 850,000 sq ft.

Glasgow was third with 2.99 million sq. ft., while Birmingham and Liverpool occupied the top two spots.

Edinburgh’s limited space was reflected in its retail vacancy rate, which at 11.8% was the lowest outside of London. Glasgow also performed better than the 18.2% average, with 16.6%.

Edinburgh has the most productive retail floorspace of any major UK city outside of London, with Glasgow close behind. They are first and fourth, respectively, among the nine cities tracked – Manchester was second and Leeds third.

Daily Business reported recently that Heal’s, the London-based contemporary home furniture retailer, is looking to open a store in Edinburgh.

A higher productivity figure indicates strong sales volumes measured against the city’s amount of retail floorspace, while a low number suggests under-performance and/or an oversupply of accommodation.  

The figures offer some hope that the retail sector is more resilient than surveys suggest.

Stephen Springham, head of retail research at Knight Frank, said: “Scotland’s central belt continues to show strength as a retail destination, despite the well-publicised challenges of the last few years.

“But, rather than city centre or shopping centre retail space being where there is an over-supply, our research suggests it is out-of-town pitches that are more challenged and where change of use is most likely to follow. The question is whether this floorspace is viable for alternative use.”

Euan Kelly, capital markets partner at Knight Frank Edinburgh, commented: “Edinburgh seemed to go against the grain of other cities in the UK with the development of St James Quarter – it is the biggest retail development of recent years and no other city or town in the country has anything like this in the development pipeline.

“But the city centre lacked a high-quality retail destination as a focal point and, as our research shows, it has adapted well to the Quarter’s arrival.

“As a result, Edinburgh’s various retail pitches have re-established themselves or carved out their own distinct identities to co-exist, rather than compete.

“George Street is a prime example, showing that it can offer a distinct location for luxury brands. In recent years, we have seen more investor interest in the right type of retail property and expect that to continue as 2025 progresses.”

Douglas Binnie, capital markets partner at Knight Frank Glasgow, added: “Glasgow has long been one of the UK’s top retail destinations and continues to retain that status.

“New brands are arriving in the city – most notably Uniqlo, in the not-too-distant future – and future redevelopment plans in the city centre, along with the council’s plans to double the number of people living in the heart of Glasgow, should only strengthen its offering.

“Buchanan Street, in particular, remains one of the top-performing retail destinations in the UK and has bounced back well from the pandemic years – a fact reflected in Glasgow being top for Zone A rent growth between 2013 and 2023.

‘There have recently been good levels of letting activity on the thoroughfare and, with that, Zone A rates continue to rise. Adding to several recent deals, we expect to see more investment activity on the street this year.”