Kevin McKenna: Inside Glasgow's new Atlantic Quay financial district

All the accoutrements indicating wealth, achievement and a robust economy are present. Tall cranes loom over scavenged gap-sights, now cleared of the landmarks of the past: isn’t that where the pawn shop used to be? The City Rendezvous tavern used to be there. There’s where Henry Africa’s nightclub used to be and the Ho Wong restaurant. But where are the actual people?

On Wednesday lunchtime I wandered for a few hours through this district. The old street names are there – if you look hard enough – but they’ve been nudged aside by a big, new fancy neighbour called Atlantic Quay. A simple street sign isn’t enough for Atlantic Quay. Its addresses are picked out in chrome or carved in stone into the largest office blocks.

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The International Financial Services District, to give it its full business honorific, is announced on little green and blue banners fluttering from lampposts. Some of the businesses which have moved in here are more prominent than others. The big hitters are all here: Bank of Scotland/Lloyds, Barclays, BNP Paribas, Morgan Stanley, BT, Clydesdale Bank, JP Morgan, RBS, Santander.

I pop into One Atlantic Quay, the gateway to this settlement. There are five floors but only the first floor has a name attached: the property firm Mactaggert & Mickel. I’ve not been down this neck of the woods for a few years, so I ask the man on the security desk if the other floors are occupied.

“Why do you want to know,” he asks. “I’m from The Herald and I’m writing about this neighbourhood,” I reply. He’s satisfied I’m not packing Kalashnikov and tells me that it’s the DWP – the Department of Work Pensions.

I go back outside and start moving up Robertson Street, taking pictures of the buildings on my smartphone. I’m approached by a woman with a hoodie, bearing the initials of a security firm. “Are you lost,” she asks. Ah, that’s nice, I think: you’re never far away from my city’s famous hospitality. 

“I’m alright, but thanks,” I reply. “Can I ask you why you’re taking pictures, then,” she asks. Now there’s an edge. 

“Who wants to know,” I reply. “I’m just curious as to how you just walked in to the premises,” she says. But satisfied that I’m not packing heat, she wanders off.

Further along, I walk into another silver palace. It bears the imprint of something smooth and understated. There’s a Nespresso coffee bar for the employees. And a wooden terrace with brightly-coloured cushions, indicating one of those chi-chi thinking pod arrangements.

But there are no workers though, only an office manager. Another twitchy exchange unfolds.

“Can I ask which companies work here?

“Can you tell me why you want to know?”

“I’m writing about your neighbourhood.”

“I’m afraid I can’t divulge that information.”

“Why not?”

“If I told you, then you’d understand,” he says. And so I depart wondering if a chemical warfare specialist or a nuclear facility has stealthily moved in here.

The cranes and the busy gap-sites and all of these big-ticket, chrome palazzos seem to bear witness to a Klondyke on the banks of the Clyde. But the Scottish Government has a massive office here and so does the UK Government.

If you were a cynic you’d observe a co-relation between National Government, the DWP, Big Energy and Finance and the world’s largest accountancy firms, a sort of square mile of misery. The winners stash their money in unorthodox tax jurisdictions and the losers head to One Pacific Quay to plead their cases at the DWP. The route of travel – upwards and downwards – can be picked out in these streets.

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The IFSD website proclaims the virtues of Glasgow for the global finance sector. “Glasgow is a world-class business location for business and financial services companies with the property, infrastructure, technology and, above all, the people with the right skills and experience.”

Yes, all that is here and, judging by the construction work, will expand. But again, where are the people? Walking through these swanky satellites of the global elite is an eerie experience. It’s like one of those Chinese ghost cities which sprang up during a boom-time only to remain barren and unoccupied as the trade winds never quite reached them. A solitary Café Nero is free to pick up passing trade.

Yet, David Low, one of Glasgow’s best-known investment consultants, is delighted at seeing this little square kilometre transformed into something he thinks is akin to Manhattan or Philadelphia. “I love these new buildings,” he says. “They make the city look appealing and sophisticated.”

“But where’s the people,” I ask him. 

“I think what’s been happening is that many of these projects and deals were started before the pandemic. And you probably also need to understand that while the city has certainly attracted investment, a lot of the land north and south of the Clyde is cheap. Also, we don’t know what sweetheart deals have been done to attract these big names. I know that at least one big national bank got their premises for a snip.

“However, Covid has shifted the needle. I travel to London and the US a great deal and their finance sectors are facing up to the changes wrought by Covid too. In the post-pandemic world, hybrid working is here to stay. It’s a problem being discussed globally. Will we ever need this office capacity again?”

An article in The Economist backs this up. “The pandemic has sharpened debate about what the future holds for commercial hubs. Key business districts such as Manhattan, the City of London, Tokyo’s Marunouchi and Le Defense in Paris have borne the brunt of the office exodus.” 

The Economist further reported that prior to lockdown the world’s largest business districts housed 4.5m workers and around a fifth of the headquarters of Fortune Global 500 companies. As the pandemic entered its third year the long-term fate of business hubs became unclear. Would they still be able to attract the same rates of investment?

Glasgow’s finance hub is speckled with the fragments of earlier times: a tobacco warehouse on James Watt Street; William Wheatley Warehouse; the old Clydeport building. These places were built to withstand the ravages of time and have aged elegantly. 

I’m not sure many of these ocean-going liners of global finance would easily stand more than a dozen or so West of Scotland winters, if they were left empty and under-used. On almost every new building a sign tells you that thousands of feet of empty office space are available to rent.

The streets that sweep north of the Financial District don’t appear to have accrued much of a spin-off. Argyle Street has grown more decrepit in the two decades since these grey, metal edifices started to rise. And large parts of Sauchiehall Street look like they’ll soon be reclaimed by nature.

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More than £1Bn worth of investment has passed through the IFSD since its creation in 2001 and the private/public partnership which manages it claims that more than 15,500 jobs have been re-routed here. Yet there’s scant visual evidence that this bounty has supported the city centre economy or attracted people to make their homes here.

David Low thinks there may be a Covid dividend opportunity here. “How do you raise the finances when revenues from rent are falling in line with the empty office space? Across the world there is increasing talk of converting disused property to residential spaces.”

Perhaps the answer lies in what’s become known as Extreme Positive Incentive for Change (EPIC). There is a twin approach to this: severely penalising owners of unoccupied properties so that it becomes too expensive to do nothing with them. Or, incentivise them to do something with it through tax breaks for conversion and fast-track planning permission. 

Will Glasgow have the will or the wit to do it?