M42 and Solihull office market research — Q2 2021
Q2 saw the Solihull office market secure almost double that of the previous quarter, with 10 transactions totalling 39,970 sq ft. And with our knowledge of the deals to come, the only way is up.
A good improvement this quarter on the previous one, although, as always, lack of supply continues to be a fundamental issue. However, market activity is set to continue to improve, with 4 deals we expect to take place in Q3, totalling c. 80,000 sq ft.
Q2 2021 stats
3 9 , 9 7 0
total take-up (sq ft)
1 1 , 7 0 1
largest deal (sq ft)
Solihull office market at a glance
- Key transactions – occupiers topping the stats in the Solihull office market
- Rivus are ‘Kings’ of Q2 – fleet management company takes most space in Q2
- Construction on the up – construction and related sectors active this quarter
- Redditch and Bromsgrove – back in the figures, with 26% of take-up
- Impact of industrial – as warehouse market booms, we look at its effect on the M42
- Big things ahead – several larger transactions due to complete in coming months
- Rising rents – as supply diminishes, rents are on the increase
- Outlook – what lies ahead for the Solihull office market
Key Solihull office market transactions
|Size (sq ft)
|2620 Kings Court
|Units 9 & 10 Quartz Point
|Briggs & Forrester
|Unit 2 Topaz
|Fleet and warehouse management software
|55% of take-up
Rivus are ‘Kings’ of Q2
Fleet management company, Rivus, formerly BT Fleet, has taken 11,701 sq ft at 2620 Kings Court on Birmingham Business Park. This letting represents the largest transaction of the quarter.
Rivus had been in the market for new offices for a while, needing to relocate out of the space it occupied within BT’s offices at 4520 Solihull Parkway, Birmingham Business Park and have stayed on the Park.
In 2019, BT sold its fleet management arm, BT Fleet – responsible for over 80,000 vehicles – to Aurelius Group. The now renamed business, Rivus, handles the requirements of BT as well as a variety of other customers, including Highways England.
Rivus chose to stay in the area because they particularly like the location and its proximity to Junction 6 of the M42. This is an excellent fillip for Birmingham Business Park, which will soon have a vacancy rate of just 4%. The recently added second entrance has significantly helped existing occupiers accessing the Park. Progress Way provides flexible access to and from the business park, easing congestion at peak times and futureproofing the local road network.
Construction on the up
Businesses in, and related to, the construction sector have made a strong appearance in the stats for Q2. The list of construction and construction-related businesses taking space are listed below:
|Size (sq ft)
|Units 9 & 10 Quartz Point
|Briggs & Forrester
|Unit 10 Empire Court
|31 Homer Road
|Solihull Town centre
|39% of take-up
Briggs & Forrester took 5,296 sq ft across Units 9 & 10 Quartz Point
The building services provider, which has locations stretching from Leeds to Exeter, already occupied Unit 11 at Quartz Point office campus. They have now expanded into two additional units to accommodate the Group’s business activities, representing 25% more space at the office park.
Wates took 3,869 sq ft at Unit 10 Empire Court, Redditch
Wates chose this location in response to being awarded a contract by Worcestershire County Council. By selecting offices in Redditch, the business now has a location within the county of Worcestershire. Unit 10 Empire Court had undergone an extensive refurbishment programme to combine its original features with modern office standards.
Glencar Construction took 3,405 sq ft at 31 Homer Road, Solihull
The construction firm, which specialises in delivering turnkey commercial property developments, had previously occupied 1,300 sq ft at 6110 Knights Court on Birmingham Business Park. As such, this transaction represents an increase of over 160% in their total office space in Solihull.
Redditch and Bromsgrove – back in the figures
Whilst, in recent years, we’ve regularly seen quarters with no transactions in Redditch or Bromsgrove – again due to lack of stock – this quarter, we saw three deals totalling c. 10,500 sq ft, representing 26% of take-up within the M42 corridor.
This included the third largest letting of the quarter, to Vigo Software at Unit 2 Topaz in Bromsgrove. Vigo provides transport software and vehicle tracking solutions for fleet and warehouse management.
The move to Topaz Business Park, at J1 of the M42, was an expansion from their previous premises in Tardebigge, 4 miles away, as well as a flight-to-quality. Speaking of the move, Darren Cronshaw, Managing Director of Vigo Software, said:
“We are excited about the future and moving to a new site is part of a long-term growth plan that will provide [our customers] with a range of new products and solutions in the coming years, enabled by expanding the skills and capabilities that the team at Vigo provides. We have been looking for a new home for quite a long time and are excited to say we have found it.”
Impact of industrial
With the prominence of construction in this quarter’s figures, and even demonstrated by the growth experienced by Vigo Software, it is worth highlighting the current boom in logistics and warehousing space. This market is performing immensely well at the moment, with online retail receiving a significant boost from changes in consumer behaviour accelerated by the pandemic. The Solihull office market has already benefited from the exponential growth in online shopping, with significant lettings to Gymshark and, more recently, Lounge Underwear, who have their both HQ offices and warehouse facilities on Blythe Valley Park.
The Midlands is a prime location in the country for warehousing and logistics space, for its links to the UK motorway network and, of course, its position in the centre of the country.
The high demand for warehousing space in the West Midlands is driving new developments in areas such as Solihull. The new design and build opportunity for industrial, warehouse and R&D units at Birmingham Business Park is an excellent example. Once tipped as a potential location for new offices, it will be the site of Diamond – providing high quality industrial space from 40,000 sq ft to 120,000 sq ft.
Big things ahead
Q2 was a significant improvement on Q1, almost doubling, in fact. That increasing rate of activity is set to continue, with Q3 forecast to achieve c. 80,000 sq ft. This is in light of four upcoming deals ranging from 10,000 to over 30,000 sq ft – all expected to complete during Q3 between J4 and J6 of the M42.
Whilst this is excellent news for the market, it also means that the low office supply levels in the Solihull office market will slip even lower.
BBP vacancy rate down to 4% and rising rents
As previously mentioned, Birmingham Business Park’s vacancy rate has decreased and will soon hit just 4%, once again. This location, which is so intensely popular with local, national and international businesses, will be limited in the options that it can offer new occupiers, or existing occupiers looking to expand within the Park.
The gap between demand and ever-decreasing supply has put the negotiation power in the hands of the landlord. We are seeing high quality refurbished office space achieving higher rents and this is likely to be the same story for rent reviews, as landlords will be able to command higher rents for their properties if occupiers wish to stay.
The likelihood is that – unless businesses need to make changes to their occupancy – they will want to stay put, because available office space elsewhere in Solihull and in the M42 corridor is so scarce.
There is new space in the offing, such as Solihull’s Westgate – spearheaded by Solihull Metropolitan Borough Council. This impressive 120,000 sq ft office building is being marketed as an ‘oven-ready’ pre-let scheme, becoming available in 20 months of a substantial agreed contract to let.
With lack of stock being so pronounced, and rents rising, we advise occupiers to be proactive if they have an upcoming requirement. Give yourselves plenty of time to identify your company’s next office location.
Whilst there has been concern around the impact of the pandemic on the area’s occupiers, the reality is that very few have closed down. In regard to any changes in occupiers’ requirements, as with Birmingham city centre, businesses typically won’t make changes until they have a lease event.
For many, this gives them time to establish what their office operations look like going forward. Whether occupiers will take much less space remains to be seen. From recent conversations, it seems likely that some will stick what they have, some may take less space, and some may, in fact, take more. Whatever they decide, the flight-to-quality trend looks set to continue.
See full details of the transactions featured in our M42 and Solihull office market research.
For more information, please contact Malcolm Jones on 0121 233 2330 or email firstname.lastname@example.org.
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