CoStar UK - The Leader in Commercial Property Information

GPU completes 190,000 sq ft Glasgow HQ letting

By Paul Norman - Wednesday, February 07, 2018 13:00

The Government Property Unit has completed its letting for HMRC of circa 187,205 sq ft of offices at Bam Properties', Taylor Clark Properties' and LGIM's Atlantic Square development in Glasgow, with staff told today.

The Government Property Unit chose the 300,000 sq ft Atlantic Square development as part of a relocation of staff and the creation of a regional hub in the city ahead of shortlisted rivals HFD Group’s planned 215,000 sq ft office in Bothwell Street and Drum Property Group’s planned regeneration of the Tradeston Street area at the end of last year. The deal completed two weeks ago it is understood.

BAMTCP Atlantic Square, a joint venture between BAM Properties and TCP Developments, and LGIM Real Assets (Legal & General) confirmed today cthat work will begin in March 2018 on the development of circa 284,000 sq ft of office space at Atlantic Square in Glasgow.  187,000 sq. ft. of the development will house the next UK Government hub and will be funded by Legal & General Retirement, with BAM TCP Atlantic Square funding the remaining 97,000 sq. ft. of speculative space.

Planning consent has already been obtained for two office buildings of 180,000 sq ft and 80,000 sq ft alongside a third building for residential and retail space.

HM Revenue and Customs (HMRC) announced its latest addition to a network of 13 state-of-the-art regional centres to staff this morning, by signing an agreement to lease an estimated 187,205 sq ft of office space in a 10-storey new build at Atlantic Square, Argyle Street in Glasgow for 25 years.

The GPU said the development is easy-to-reach with excellent transport links, in addition to providing HMRC with the digital infrastructure required by a modern tax authority.

The building will eventually accommodate about 2,700 full-time equivalent employees from across the department by 2021.

Steven Boyd, HMRC Estates Director, said: “I’m delighted to confirm Atlantic Square as our 10th regional centre. HMRC has a significant presence in Scotland and we are pleased to grow upon this in Glasgow. The development will help continue HMRC’s transformation into a modern, digitally-advanced tax authority thanks to the site’s high specification office space, central and accessible location and digital infrastructure.”

Leader of Glasgow City Council, Councillor Susan Aitken, said: “This is a significant and long-term investment in Glasgow that reinforces the city’s status as a world-class business location and a major hub for jobs in the financial services sector.”

HMRC instructed JLL to undertake a comprehensive search of Glasgow, and the Atlantic Square development was "found to be by far the most suited and cost effective" the GPU said.

BAM Properties Ltd and TCP Developments Ltd are developing Atlantic Square as a joint venture.

The lease payments on the new HMRC Glasgow Regional Centre will be taxable in the UK.

Cushman & Wakefield is acting for Taylor Clark and BAM and JLL is acting for the government. Knight Frank acted for Legal & General. Construction work is expected to begin in March 2018. BAM TCP Atlantic Square is speculatively developing Building 2 which comprises 96,650 sq. ft. of high-quality office space and which will be complete and ready for occupation in 2020.

This letting represents Legal & General’s sixth Government hub forward funding deal and will see HMRC become one of the largest employers in Glasgow. LGIM Real Assets has secured the funding on behalf of Legal & General Retirement, which invests in high-quality, long-term UK assets that generate income streams that match its commitments to pensioners.

Adam Kerr, Head of Annuity Transactions, LGIM Real Assets, said: “This is a great deal for us and will act as a further catalyst for this area of Glasgow, regenerating a long vacant site, creating new jobs and driving economic growth.”

Hayley Rees, Head of Direct Investments at LGR, said: “It is a great investment fit for us as it enables us to fulfil pension promises to our customers in an efficient way, whilst playing a part in driving job creation and economic growth, which is good for business as well as our customers.”

Dougie Peters, Managing Director of BAM Properties, said: “We are delighted to be working with LGIM and HMRC on this Grade A office development which will become one of 13 state-of-the-art regional centres for HMRC. Simultaneously, the BAM TCP Joint Venture is speculatively developing Building 2 at Atlantic Square because we believe there is a high level of demand in Glasgow for premium office space. BAM Properties has a long and successful history of knowing when the time is right for major commercial developments in Glasgow – such as 110 Queen Street and the Clarion Building and we are confident that Building 1 and Building 2 at Atlantic Square will be equally good news for Glasgow.”

Jon Brand representing Taylor Clark Limited on the JV Board, said: “We are delighted that after a 10 year association with the Atlantic Square site, we are now able to see the development fulfil a strategic role within the Broomielaw area, which has for some time been identified by Glasgow City Council as a major area of future office and commercial development. Taylor Clark has a long history of successful office development in Glasgow, including the nearby Meridian Court and esure buildings on Cadogan Street. We are excited about the future of the Atlantic Square project which further enhances the infrastructure and employment opportunities in this area.”

Angela White, Head of Corporate Services at JLL in Glasgow, said: “The Government’s decision to relocate another regional hub in Scotland is testament to the strength of the commercial property market and standard of living in Glasgow. Atlantic Square was selected following a robust process which considered a broad range of criteria as well as cost efficiencies. Situated in the heart of Glasgow’s International Financial Services District, and within walking distance of both major train stations, the vibrant mixed use development will provide excellent connectivity for staff and visitors.”

pnorman@costar.co.uk

Get in Touch
+44 203 205 4600