First quarter figures for Birmingham and Edgbaston, as released recently by the Birmingham Office Market Forum, although characteristically a quieter quarter, the performance signified a number of positive markers with the forthcoming large office lease breaks and expiries still to become evident.
The healthy level of transactions for office space in Solihull and the M42 corridor were above the annual long term average, with some reasonable sized deals and a number of significant ‘under offer’ transactions to also complete shortly.
Research highlights for offices in Birmingham and Edgbaston
- Three transactions over 10,000 sq ft this quarter compared with just one in the same quarter last year.
- Property, recruitment and financial services featured prominently as business sectors. In contrast, the legal sector has been relatively quiet in recent times, but there may be further news from this sector later this year.
- A marked increase in demand for office space in Edgbaston – 37% by square footage, including two over 10,000 sq ft. Offices in Edgbaston have found their level relative to office space in Birmingham city centre and are enjoying increased demand by retaining businesses rather than losing them to the city centre, as was previously the case.
- Evidence of companies relocating into better quality and more efficient office space – for example, Healthtrust Europe at 19 George Road and Perkins Slade at Tricorn House. There is also evidence of companies expanding, including Weightmans into the ground floor of St Philips Point, and Wesleyan into Colmore Gate.
- Forthcoming large office lease breaks and expiries still to become evident – “We are acutely aware of the number of occupiers who have initiated searches for office space in Birmingham above 20,000 sq ft and look forward to some movement on these later this year”, commented Mark Robinson. “With notable large occupiers still mulling over their opportunities, the recent activity by PWC is also good news. They have re-geared only the space they occupy in Cornwall Court as a 5-year medium term fix, a measure which allows them to assess the future market for Birmingham office space.”
- Birmingham’s Paradise Circus redevelopment can now move forward – the recent announcement of Birmingham Conservatoire’s plans to relocate to Eastside, with an architect designing a new purpose-built facility to be built alongside Millennium Point, means that Argent and Altitude Real Estate can really start in earnest to take the Paradise Circus redevelopment forward. Comprising ground floor retail and offices above, this will be the single, biggest, most notable scheme to dramatically improve and expand Birmingham city centre core and link it to Brindleyplace – since the development of Brindleyplace itself!
- Incentive levels on Birmingham offices are steadily decreasing, particularly on Grade ‘A’ office space, and are also beginning to impact on refurbished office space. Prime office space in Birmingham has the potential for rental growth as major requirements become active.
Research highlights for offices in Solihull and the M42 corridor
- Offices at Birmingham Business Park showed marked increase in demand – 28% of take-up (16,674 sq ft). Part of the resurgence at the Park, which has not experienced this level of demand for many years, is down to attracting new occupiers such as UKDN, Longcross and Chalcroft.
- Companies in Solihull and M42 corridor doing well and expanding – Equiniti increased by 50% its office space at Kings Norton Business Centrewithin Kingsgate House, a location that aligns itself far more to M42/M5 motorway access than Birmingham city centre. UKDN and EUM Consulting both moved up from serviced offices – the businesses are doing well, staff numbers are increasing and so they have moved on to take office space on conventional leases rather than in serviced offices.
- Utilities, property and financial services featured prominently as business sectors.
- KWB continued its strong presence in the market by completing 60% by square footage of the transactions for office space in Solihull and the M42 corridor.
For more information, please contact Mark Robinson on 0121 212 5994 or firstname.lastname@example.org.