Office space Birmingham city centre – quarter 3 2014 take-up
Q3, July to September, was a much healthier quarter for transactions for office space in Birmingham city centre.
With an increase of 37% over the previous quarter, the resulting 156,000 sq ft – although slightly shy of the 177,500 sq ft long term average for a quarter – is a promising sign of growth and recovery, post-recession. Average office letting size also increased by 9.2% to 3,550 sq ft.
Birmingham Jewellery Quarter office space was also particularly active, securing 39% of the office space transactions, with 55% taking place in Birmingham city centre core. Continuing on from last quarter’s high level of activity, the trend of financial and recruitment companies being the key business sectors taking office space continues to be a good sign for Birmingham’s economy.
Larger transactions for office space in Birmingham still to materialise
Although we’ve seen an increase in both the average letting size and the quarter total, there is still a scarcity of larger transactions foroffice space in Birmingham and Edgbaston; Q3 only yielded 3 transactions above 10,000 sq ft. It’s this lack of larger deals that is accountable for the slightly below par quarterly figures, as the frequency of office space transactions is not an issue.
We expect several notable office lettings to appear in the statistics for Q4, the most notable of this is the widely publicised letting of 100,000 sq ft in Two Snowhill to HS2. Whilst a number of articles have already been written about this, the letting had yet to complete at the end of the quarter. Other notable lettings that narrowly missed the Q3 figures are HSBC’s expansion in 120 Edmund Street and Extra Energy’s relocation into Broadway offices in Edgbaston.
In this quarter, however, the largest deal was Vodafone taking a floor of Colmore Plaza, to the tune of 22,924 sq ft. The other two deals over 10,000 sq ft were the Office for Legal Complaints relocating from Baskerville House to more cost effective premises at Edward House in Quay Place; and the Valuation Office Agency’s relocation to Building 2 Broadway offices in Edgbaston.
Speculative refurbishments of office space in Birmingham pay dividends
Speculative refurbishments of office space in Birmingham have experienced good success this quarter. A prime example of this popular trend is the joint venture refurbishment (Bridges Ventures and Evenacres) at 158 Edmund Street offices in Birmingham. Five lettings totalling 19,386 sq ft have been completed there this quarter, with transactions ranging from 1,540 to 5,230 sq ft. Circle Property and Hortons’ Estate have also secured occupiers in their Cheltenham House and Innovation Court developments.
Birmingham office space – an active commercial property market
As expressed in previous commentaries, the influx of smaller deals over the course of this year signals a trend of an active commercial property market in Birmingham, with those larger deals still in the pipeline. We expect that, following completion of the HS2 letting in Two Snowhill, several main contractors and consultants will also seek to acquire a project office in Birmingham city centre to service this contract. We are starting to see searches initiate for some of these parties, who we expect to secure premises by mid-2015.
See full details of the transactions for office space in Birmingham city centre and Edgbaston.
For more information, please contact Mark Robinson on 0121 212 5994 or email firstname.lastname@example.org.