Office space Birmingham city centre – quarter 4 2015 research
970,458 sq ft – a record year for office transactions within Birmingham city centre. The second city is experiencing its highest level of property and infrastructure development in 13 years.
The forward purchase of 212,000 sq ft of office space in Birmingham city centre by HSBC at 2 Arena Central was the standout transaction of the year, representing the largest example of both the relocation and consolidation trends that have dominated key transactions in 2015.
A new city
With the progression of the city’s Metro system – due to run through to New Street as of March 2016 – bringing the key areas of this large city closer together, it’s clear to see Birmingham is changing. 2015 saw the launch of the new New Street Station and Grand Central Shopping Centre, galvanising both the high street and railways – ahead of HS2 in a few years’ time, which will surely do the same.
New money – inward investment
Birmingham’s recent and ongoing investment in infrastructure, transport and amenities have made the city very appealing. The inward investment transactions we have seen in response include HSBC’s forward purchase of 212,000 sq ft at 2 Arena Central and Advanced Computer Software taking 45,045 sq ft at The Mailbox. Relocations such as these are big news – bringing new money and the promise of many new jobs to the city.
It’s also worth noting that, just 5 months since its opening, Grand Central has been sold by Birmingham City Council to London based retail property firm, Hammerson, for £335 million.
HSBC takes over 200,000 sq ft of office space, Birmingham city centre
HSBC’s relocation from Canary Wharf and huge inward investment was, understandably, the biggest story of the year. The 220,000 sq ft forward purchase kick-starts the Arena Central programme. It is likely that the move to Birmingham was encouraged by Deustchebank’s relocation 2 years ago, to 5 BrindleyPlace – which provided them with 134,000 sq ft of Birmingham city centre office space. HSBC will see reduced costs of occupation and staffing in the relocating of its retail division – and, in doing so, will create 1,000 jobs for the city. We anticipate HSBC’s relocation having its own halo-effect, as with HS2; lettings of this magnitude often create ripples – galvanising the property market.