The food and beverage market in Glasgow continued to recover from the impact of Covid-19 last year, with 23 new openings marking the strongest activity for the sector in the city in the past five years.
Research from Savills shows activity is 15% ahead of 2021, with a total of 80,000 sq ft of new restaurant and bar space opening in the city centre.
Independent operators continue to dominate, with 65% of all transactions attributed to local entrepreneurs. Notable openings included Fat Lobster, Gost, Devil of Brooklyn, August House and Bao.
Savills also reported that the larger national operators were also active in 2022, including Cosmo, Fat Hippo and Mowgli.
Bars, as opposed to restaurants, proved to be the most prevalent in their search for Glasgow premises, with Innis & Gunn opening a new taphouse on West Nile Street and The Alchemist launching a new cocktail bar on George Square.
John Menzies, retail director at Savills in Glasgow, commented: “The five year picture of transaction volumes illustrates the bounce back from Covid-19 and is a strong vote of confidence in the ability of our largest cities to evolve and recover.
“These sentiments may sound surprising given the acutely challenging trading picture at present, and the food and drink sectors exposure to rising utility costs and the impact of train strikes on city centre visits.
“With many operators reporting trade down 25% on expectation over the Christmas period, confidence to commit to new properties at the moment is predicated on an underlying optimism that the economic climate will improve as we move past the current year, into 2024 and beyond.”
Turning to 2023, Savills' predictions for Glasgow food and beverage include occupier demand remaining strong. The company is presently tracking 15 unsatisfied restaurant or bar requirements for the city centre, typically requiring large properties of over 4,000 sq ft.
It predicts that the bulk of transactions will take place in the second half of the year, as occupiers look to ride out challenging trading conditions with pipeline projects.
Savills also pointed out that Glasgow has an outdated planning policy which still prohibits food and beverage uses on many key thoroughfares. A review is ongoing and changes are hoped to reflect evolving consumer habits and mixed use shopping areas.
Similarly, delays in obtaining a new liquor licence in Glasgow continue, with Savills warning that operators should plan this year for a seven month turnaround from application; further frustrating opening schedules.
Competition for the best sites around Buchanan Street remains a feature and could result in rents growing by 10% by the end of 2023. Current prime food and drink rents in Glasgow are £40 per sq ft, although this still looks cheap compared to Edinburgh, where they exceed £60 per sq ft.
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