The Development
Bothwell Exchange presented an opportunity to acquire a ‘full island block’ development site totalling 1.3 acres in size, located on Glasgow’s ‘Commercial High Street’, in the heart of the city.
Formerly occupied by the Albany Hotel (latterly the Holiday Inn) for 30 years, the dilapidation of the building meant it could no longer function as a quality hotel and the site was cleared for redevelopment in early 2008. HFD acquired the site in 2016.
The site was already easily accessible by public transport, surrounded by outstanding local amenities, and within walking distance of everything Glasgow has to offer.
Why HFD? Why Glasgow?
HFD, Glasgow’s largest office developer, is renowned for delivering exceptional, best-in-class office developments throughout Scotland, and 177 Bothwell Street has proved to be a flagship example of the type of premium quality, sustainable office development with which the company has long been synonymous.
Global developers like HFD are keen on Glasgow as a preferred business location in the UK and Europe due to its collective offer of excellent value for money, superior yields and access to a highly networked business, civic and academic environment.
HFD, which has delivered more than 2.8 million ft² of commercial space during the past 30 years, was attracted by the opportunity to capitalise on the strong underlying fundamentals in the Glasgow office market, with high demand and low supply of the best quality Grade A offices.
Stephen Lewis, HFD Property Group’s Managing Director, said Glasgow represented “an optimal investment location as Scotland’s largest city, sitting at the centre of the country’s largest integrated economic region, with around a third of the national output, business base, research power and employment”.
The city has matured as a global investment proposition, attracting investment and major occupiers from a broad and diverse international base.
Other key reasons behind HFD opting for Glasgow included the skills and loyalty of a flexible and qualified workforce, the cosmopolitan feel of a large city, great access and digital connectivity.
“We were also attracted to Glasgow by the level of cost-effective office space, along with proximity to market and customers, as well as the ease of doing business. And having one of the youngest populations in Scotland – and 52% educated to degree level – means companies can readily find and retain talented staff,” added Lewis.
The Scheme – Sustainable, Connected
A 155,000 ft² office building (122 Waterloo Street) was developed by HFD on the southern part of the site and leased in its entirety to Morgan Stanley. This letting was seen as a ringing endorsement of Glasgow by Morgan Stanley, their new office being the investment firm’s fifth largest globally, and its second biggest in Europe.
The northern half of the site (177 Bothwell Street) formed Glasgow’s most prestigious business address, offering around 100m of frontage onto Bothwell Street.
The scheme is Glasgow’s most sustainable office development, with an ‘A’ rated Energy Performance Certificate (EPC) – targeting sub-8, approximately 45% better than the lowest ‘A’ rating. It is BREEAM ‘excellent’, is net zero carbon in operation and utilises 100% green power from a local and identifiable source, namely an HFD-facilitated wind farm located in South Lanarkshire.
Specifically designed to meet the evolving needs of occupiers, 177 has placed a strong emphasis on sustainability. The building is fitted with the latest energy efficient equipment, including LED lighting throughout, together with highly efficient, heat-recovery air conditioning systems to reduce consumption.
177 features an intelligent building management system which reduces consumption and maximises energy data management. Occupiers will sign a green Memorandum of Understanding to work collaboratively to reduce energy usage.
A green travel plan has been developed to reduce car usage and encourage sustainable active transportation, including cycling, walking, public transport, with 318 internal cycle spaces for staff and a further 70 visitor cycle spaces outside, along with spa-quality changing areas.
Two electric car charging points will be located within the development to encourage electric car charging take-up. The building also has the capacity to enable each car parking space to be upgraded to an electric car charging space.
177 is the first Scottish property to commit to attaining the new SmartScore accreditation for smart buildings and has already achieved a ‘Platinum’ WiredScore certification, a standard recognising that future occupiers will have the best digital connectivity available.
The Local Authority
HFD acquired the long leasehold interest in the site and subsequently re-geared the ground lease for 125 years with City Property, Glasgow City Council’s arms-length property company.
Following the completion of Phase 1 (Morgan Stanley’s HQ, at 122 Waterloo Street), HFD converted their long leasehold interest into full ownership of the Phase 2 part of the site on which 177 Bothwell Street is located. To this end it worked closely with Glasgow City Council planning, building control and roads colleagues, as well as wider stakeholders.
Strong working relationships with the council will be maintained following completion of the development as a result of commercial property advice and support provided to both the Glasgow City Centre Recovery Taskforce as well as the Glasgow Development Forum.
Job Support
Independent analysis produced by the economic and social research consultants EKOS indicates that the new building will have a cumulative impact of more than £2.8bn gross value added (GVA) over 25 years across Scotland, contributing £1.8bn to Glasgow’s economy alone.
Construction work is estimated to have provided a one-off GVA contribution of £51m and generated more than 800-person-year-equivalent jobs in the construction sector. The analysis also outlines several wider benefits for occupiers, workers, and the wider economy, from an increased talent pool and opportunities for knowledge sharing, to lower transport costs and economies of scale.
177 Bothwell Street is also expected to help maintain and build on Glasgow’s reputation as a major centre for financial and professional services.
A Tenant’s Tale
Douglas Smith, executive director of CBRE – 177 Bothwell Street’s early tenant – said: “As a responsible and forward-looking business, CBRE’s vision is to realise a more sustainable world for all. Our Green Dimension helps us achieve this by embedding sustainability into everything we do. Across every service and team, both as individuals and as a company, we understand every action matters.”
Smith said his firm’s teams in Glasgow were excited to be moving to 177 Bothwell Street, a building which will have the highest green credentials in the city.
“Our move will also see for the first time our three core business units in the West of Scotland being able to co-locate in new space where our aim is to secure BREEAM Excellent and WELL Gold accreditations.
“The success of 177 Bothwell Street, with its benefits of an excellent CBD location, will be enjoyed in years to come not just by CBRE staff and clients, but also the other occupiers who have signed up to move into 177,” he added.
Community Engagement
HFD Group has a significant focus on corporate social responsibility. This manifests itself in a variety of ways when tackling sustainability, employability/training, community benefits and charitable giving.
HFD created the ‘HFD Charitable Foundation,’ a Scottish-registered charity which has donated £1m over the last 15 years and has set a donation target of £250,000 per annum, with the emphasis this year focusing on the local impact of COVID-19.
The developer has also established a joint venture with the Virgin Money Foundation to establish the ‘Glasgow Community Anchor Fund’, with £700,000 committed by the partners over two years, £500,000 of which has already been distributed. In addition, HFD has created an employee-led fund to encourage its employees to undertake charitable activities, while local retailers have been supported through HFD’s construction health and safety recognition rewards programme.
177 Bothwell Street Project Fact Sheet
Website – https://www.177bothwellstreet.com/
QUICK FACTS
- 177 Bothwell Street is the largest single office building in Glasgow
- Glasgow’s most sustainable office development
- BREEAM ‘excellent’, net zero carbon in operation and utilises 100% green energy from a local and identifiable source
- WiredScore ‘Platinum’ certified
- First Scottish property to commit to attaining the new SmartScore accreditation for smart buildings
- The building will have a cumulative impact of more than £2.8bn gross value added (GVA) over 25 years across Scotland, contributing £1.8bn to Glasgow’s economy alone.
- Key tenants include: Virgin Money, Transport Scotland, CBRE, BNP Paribas Security Services & Aecom
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