Investors eye Edinburgh office and residential development

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THE property expert leading work on plans for one of the biggest office developments in Scotland for years has insisted it will be a success despite the challenges posed by the fallout from the coronavirus crisis.

Parabola started work on the site of the Edinburgh Park development early last year only to find it had to put activity on hold after the first lockdown was imposed to slow the spread of the virus.

While construction activity is now in full swing, Parabola is working amid great uncertainty about when most people will be able to return to offices.

Coronavirus vaccines are being rolled out rapidly but working from home has become the new normal for many people. Some wonder if there is any future for big office developments.

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Parabola managing director Tony Hordon remains confident there will be demand for the offices that will be built on the Edinburgh Park site, to the south of the existing office district of that name.

Marketing work is still in its early stages but Parabola has been encouraged by the response to plans for the development, which will also include around 1,700 homes and extensive public spaces.

In December, Mr Hordon said interest in the first office building, 1 New Park Square, was very healthy despite practical completion being over 12 months away.

The company has had direct expressions of interest from potential occupiers.

A 30-year veteran of the property business, Mr Hordon has no doubts that the office has a future.

“You will always need the office because, for me, the office is where you promote your brand, it’s where you instil your brand, it’s where you develop staff.

“How do you mentor, especially the younger generation, remotely? It’s really difficult,” he says.

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“The office is a wonderful roof under which you collaborate, you can create new ideas, you can take the business forward. I think it’s very difficult to take a business forward with Zoom. It’s kept the show on the road but I think the office will still have a place, a very, very important place moving forward.”

Mr Hordon reckons Edinburgh needs office space to ensure it can grow.

“We’re very comfortable with where we are because of the quality we have and because of the local dynamics of Edinburgh. There’s very little development pipeline, there’s very little being built, when you consider Edinburgh is such an international city.”

Noting that in 2017 the take-up was one million square feet, he asks: “Where is this demand going to find a new home?”

However, his confidence in Edinburgh Park also owes something to the fact it is not simply an office development.

“Do we need huge business parks? That’s a very good question … that’s why we made the decision early on that we were not going to build a two million square foot business park because I think the theme of business park has started to shift. So around half of the park is residential, which will support the commercial, which will in turn support the residential.”

Mr Hordon reckons Edinburgh Park could provide a satisfying way for people to combine their work and home lives.

“We want to have someone having breakfast in the apartment and getting on their bike or getting on their skateboard and going to the office, which is literally down the boulevard, and picking up a lovely coffee and croissant on the way.”

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Public art works are expected to help create an attractive and welcoming ‘place’.

The location of Edinburgh Park, to the west of the city centre close to Edinburgh airport, is a big plus, reckons Mr Hordon. “It has pretty much every single mode of transport in terms of car, bus, train, tram; an airport on the doorstep.”

Parabola passed a landmark in December when the City of Edinburgh Council gave the detailed planning consent it was awaiting for the residential element. Mr Hordon praises council staff for dealing with the application efficiently amid such challenging conditions.

The plans have attracted strong interest from build-to-rent operators and Parabola expects to agree a deal soon.

Investors have shown enthusiasm for other build-to-rent developments in Edinburgh and in Glasgow.

Mr Hordon thinks Edinburgh Park could keep Parabola busy for years.

The Newcastle-born surveyor has enjoyed getting to know Edinburgh since starting work on the project in 2017. He joined Parabola that year after a successful career in the surveying sector. Working in senior roles at DTZ, he dealt with flagship properties in cities such as London, Leeds and Newcastle.

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Parabola’s other projects include the former House of Fraser building on the west end of Edinburgh’s Princes Street, which it bought in 2017 amid tough times in retailing. Diageo subsequently decided to create a flagship Johnnie Walker visitor centre in the building.

Mr Hordon is confident Parabola founder Peter Millican’s willingness to take the long view will also be rewarded at Edinburgh Park. Parabola bought the assets of the business that owned the site out of administration in 2014.

 

Q&A

What countries have you most enjoyed travelling to, for business or leisure, and why?

For relaxation, it has to be the Maldives. I love Barcelona for the vibe, food, buildings, and particularly the Born District, and I really enjoyed recent stateside visits to Chicago and New York. Wherever I visit, business and leisure are always rolled into one – and part of the fun is actually getting there. I do like a flight!

When you were a child, what was your ideal job? Why did it appeal?

I wanted to be an architect but 7 years at Uni seemed too long at the time. I was attracted by the idea realising a vision in bricks and mortar.

What was your biggest break in business?

Looking back, my most significant break came when I had the opportunity to work in London. It was an eye opener to the office market. I covered Covent Garden, Mayfair, St. James and Soho which had many world class buildings. I enjoyed the London scene, and the network of colleagues and friends I built up during that time has stood me in good stead throughout my career.

What was your worst moment in business?

It was when the recession hit in 2008. I was working with DTZ at the time and we underwent major restructuring which resulted in many redundancies. Too many good people lost their jobs and careers.

Who do you most admire and why?

I have had the absolute privilege throughout my whole career to work with so many people that I have admired. I do respect those who are prepared to tear the rule book up and take a risk and are prepared to go that extra mile for long term benefit. The extra mile could be a piece of art, a piece of public realm or just a touch of quality – items which make the difference and deliver wonderful space for people to enjoy. If you build quality in, it will always look after you in difficult times, and protect your investment in the long term. Kings Cross developer Argent did an amazing job on the regeneration of the area. It was a complicated project, and their attention to detail, the public realm and sheer quality of their work was outstanding. Ahead of Argent, Peter Millican and Parabola delivered the cultural hub Kings Place – and that was truly was visionary.

What book are you reading and what music are you listening to? What was the last film you saw?

The last book I read was ‘Gary Speed. Unspoken’. I likea wide range of music and artists, and do enjoy Craig Charles’ House Party! The last film I saw was ‘Once upon a time in Hollywood’.

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