The recent rise in interest rates has made life a lot more difficult for many home owners and firms seeking finance to expand.

But not everyone has been put on the back foot following a flurry of rises that has taken the base rate from 0.1% in December 2021 to the current 5.25%.

Analysis issued by Knight Frank today has underlined a recent and growing trend of high-net-worth individuals and well-heeled family offices in Scotland investing in prime commercial property assets in Edinburgh.

According to the property consultant, which has acted on a number of these deals, these investors are stepping into a void vacated by people who would normally invest in assets of this kind, but because of increased interest rates, the high cost of debt, and attractive bond yields are, temporarily at least, staying away from the market.

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Recent deals have seen wealthy individuals and families snap up a raft of prominent addresses in the New Town, Knight Frank noted, including the building home to the award-winning Contini restaurant on George Street, and another which is occupied by jeweller Swarovski on Princes Street.

The activity has come amid what appears to be the continuing recovery of the commercial property sector as a whole in Edinburgh, defying the broader downturn seen in most UK cities. Figures issued last week showed that by mid-November the total value of deals finalised in the capital this year had exceeded the 2022 tally, at £596 million versus £555m.

“There are great commercial property opportunities for high-net-worth individuals looking to invest at the moment,” said Euan Kelly, capital markets partner at Knight Frank Edinburgh.

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“If you know Edinburgh and believe there is value in its main thoroughfares, you are looking at an opportunity that hasn’t existed since 2008, with other buyers keeping their powder dry in the current economic climate.”

With interest rates forecast to remain higher for longer, it is a trend which Knight Frank expects to continue.