KWB predicts that the number of deals for offices Birmingham city centre will spike in the next two years. This is despite projections that 2018 will fall short of both the average annual number of transactions and take-up of office space.
Writing in KWB’s Q3 2018 Birmingham office market research, Malcolm Jones, KWB’s Head of Office Agency, said: “Lack of availability of office space, Brexit and the impact of serviced office operators are all having a quietening effect on the Birmingham office market figures this year. However, we predict that a large number of lease events and new office space becoming available will boost the office market in 2019 and 2020.”
Q3 2018 saw another steady performance in Birmingham’s office market, with a take-up of 158,935 sq ft over 28 transactions. The market in 2018 has been consistent, with Q1 (148,483 sq ft over 22 deals) and Q2 (169,929 sq ft over 31 deals). However, without a landmark deal, the market would likely achieve a total of around 640,000 sq ft. This would be some 110,000 sq ft and 26 transactions less than the long-term average.
“This is nothing to worry about,” Malcolm continued. “2014 saw 148 deals, so we anticipate that lettings will spike in 2019/2020. This is as office occupiers, who took five-year leases in 2014, look to relocate. There’s also a number of larger requirements for offices Birmingham city centre, which we expect to complete next year.
“Having already attracted several pre-lets, 1.8m sq ft of new Birmingham office space will complete in the next two years. This will provide more choice for larger occupiers, particularly important for those looking to move into the City.
“It’s notable that the largest three transactions in Q3 2018 were to public service organisations, too. The government, General Dental Council and Network Rail, took some 73,000 sq ft between them.
“We don’t know the number of occupiers taking serviced office space. What we do know, is that serviced office operators continue to take large amounts of space in the city centre. However, suites under 3,500 sq ft are in demand, accounting for 15 of the 28 transactions in Q3. Small businesses remain highly active in the City and remain keen to sign traditional leases.”
Each quarter, KWB publishes research into the Birmingham office market, listing all the office transactions and providing its view of the current and future market. KWB’s complete Q3 research for Birmingham can be found here, and for the full list of transactions click here.
For more information on the market for offices Birmingham, contact Malcolm Jones on 0121 233 2330 or email email@example.com.