REAL estate firm Knight Frank has moved to larger premises in both Glasgow and Edinburgh on the back of delivering two consecutive years of record profits for its commercial property division.

John Rae, partner and head of Knight Frank’s Glasgow office said the market in Glasgow was in good shape after a period of uncertainty following the recession and independence referendum, but a lack of Grade A office space was set to provide a fresh challenge.

He also said a remain vote in today's EU referendum would help the industry.

“We’re expecting to see a bit of pent up demand and activity assuming the vote goes that way,” he said. “If it doesn’t, I don’t know what will happen, it’s difficult to say.”

The global group, headquartered in London, has revealed that in the five-year period to year-end 2016, its Edinburgh office grew turnover by 300 per cent, while staff numbers doubled in its Edinburgh commercial team.

In Glasgow, revenues jumped by 250 per cent over the same period, with 21 staff now working across its capital markets, office agency, property and facilities management, and building consultancy teams.

The new office at 25 Bothwell Street, at 3,000sq ft, provides a further opportunity for growth, said Mr Rae, who added that the Glasgow market is buoyant in all sectors.

So buoyant in fact, that new office space cannot be built quick enough.

“We’ve got a real shortage of Grade A office accommodation,” he said. “We’re now probably two or three years away from the next cycle being completed.”

He said that until then there were a number of landlords who own good secondary buildings who have an eye on doing high-quality, quick refurbishments in a bid to win tenants who would otherwise go to new Grade A schemes.

Mr Rae commented that he believed further new developments would rise in the city.

And he commended speculative developers in Glasgow for investing during the downturn and kick-starting the current boom. “Three buildings came out of the ground before the recession was even over, all of which are either full or nearly full,” he said. “Now people are thinking that Glasgow did well through the bad times, it’s in a much better place now, so let’s crack on [and build].”

Mr Rae said office developments were showing the strongest growth, internally, fuelled in part by its poaching of Colin Mackenzie and Sarah Addis from DTZ last year.

“We went from a standing start to being one of the most active and strongest agents in the market on the operational side,” he said.

In the last few years Knight Frank has merged its property management and building surveying teams across the country, added new services, and worked on some of the biggest deals in Scotland, including the Cuprum office at Cadogen Square, 100 Queen Street refurbishment and the £14m sale of the Ca’d’oro building.

In the capital, Knight Frank has moved to Castle Terrace, in a first floor, refurbished 2,950sq ft suite.

Alasdair Steele, head of Scotland commercial at Knight Frank, said the moves underlined what he called the “exponential growth” the firm has realised over the past five years. The moves would also support future ambitions.

Meanwhile, office construction reached a post-recession peak in the first quarter of 2016, with over £2 billion worth of contracts awarded in the UK, the highest figure since 2008.

According to the latest figures from industry analysts Barbour ABI on behalf of the Office for National Statistics, office construction new orders have been gradually increasing since 2012, where in the first quarter new orders were worth £890 million, compared to more than double in the first quarter of 2016.