M42 and Solihull office market research — Q2 2020

The ‘COVID Quarter’ struck even the famously resilient out-of-town Solihull office market. Only 12,000 sq ft of office space in Solihull and the M42 corridor is secured in Q2 2020, across 3 deals. That being said, demand continues, enquiries are in the marketplace and a number of deals are in solicitors’ hands.

With occupiers unable to move in or out of property, lockdown caused the market to slow to almost a complete halt. Whilst there has been no desire to commence new leases until office relocation can take place, and the impact of lockdown is better understood, demand for office space can still be seen.

Solihull office market at a glance

  • Just 3 make it over the line – COVID Quarter delivers smallest results on record
  • Q2 was a morsel but the appetite is there – KWB handling 50,000 sq ft of deals and enquiries
  • Could lockdown cause Solihull to stock up? – the various ways office stock could come back to the market
  • Push ahead with your plans – with fewer and fewer available options, the time to take space is now
  • New office development on the horizon – a welcome addition to stock in 2 years’ time
  • Infrastructure – Solihull set to benefit from substantial infrastructure projects that will change the region forever
  • Outlook – enquiries expected to move forward next quarter

Just 3 make it over the line

The 12,000 sq ft, three-deal quarter was the smallest on record in both size and number of transactions. The closest quarter to it was Q1 2015, which saw 10 office space transactions, totalling 25,897 sq ft. The transactions were all centred around the Solihull area – with two taking place on Birmingham Business Park.

LocationOccupierSize (sq ft)
1750 Birmingham Business ParkNational Fostering Agency4,762
One CranmoreLow64,675
1740 Birmingham Business ParkHITEC Power Protection2,563

Here are those deals in detail:

  • National Fostering Agency: the relocation to 1750 Birmingham Business Park represents a significant expansion. NFA, the largest independent fostering agency in the UK, had been based elsewhere on Birmingham Business Park, at Regents Court. The organisation decided to increase its commitment to the Park by doubling its overall stake to just shy of 5,000 sq ft, at 1750.
  • Low6: a very close second to NFA, Low 6, an online gambling business, took 4,675 sq ft at One Cranmore in Solihull in a relocation from offices in Stratford.
  • HITEC Power Protection: the manufacturer relocated from Holly Farm Business Park in Warwickshire to 1740 Birmingham Business Park. The company’s decision to relocate from their previous offices, which they had occupied for some 20 years, was motivated by the desire to be closer to the M42, for logistical reasons, and to find space better suited to their current needs.

Of these deals in the ‘COVID Quarter’, two were approved before lockdown came into force – carrying on into lockdown to completion. The third deal, however, the letting of 2,563 sq ft to HITEC at 1740 Birmingham Business Park was approved and completed during lockdown – despite the impact of the virus. Furthermore, the nature of each of these deals – representing either an expansion or a relocation from out of the area – affirms the prosperity of the region and the demand for office space here.

Q2 was a morsel but the appetite is there

The marketplace in Solihull and the M42 corridor is very much alive. Yes, Q2, the ‘COVID Quarter’, was a disappointing one for office space transactions. This was not just true for Birmingham’s out-of-town office market, or Greater Birmingham, but for the country as a whole. However, Solihull and the M42 corridor seem to be staying true to their reputation for resilience, with a significant amount of office space all but let.

KWB alone is currently handling c.50,000 sq ft of office space deals that are either in solicitors’ hands or requirements that have had viewings and are waiting on boards to confirm. We understand that the vast majority of these are intending to proceed.

Given the current number of enquiries in Birmingham’s out-of-town office market, it is likely that the COVID bounce-back will happen here first. Though it cannot be said that enquiry levels are back to normal, the Solihull office market is clearly more active than the Birmingham city centre at this point.

Aerial view of Birmingham Business Park, accounting for 2 of the 3 deals in the Solihull office market for Q2 2020

Birmingham Business Park

Could lockdown cause Solihull to stock up?

For many quarters, and even years now, we have commented on the ever-reducing available office stock in Solihull and the M42 corridor. The vacancy rate on Birmingham Business Park, for example, was just 3.9% at the last count.

It is possible that the pandemic could result in the freeing up of much-needed office stock in the out-of-town office market, in a number of ways. It is a sad reality that there will be casualties of the forthcoming recession and of those, the businesses that are in Solihull and the M42 corridor will vacate their premises. However, we don’t anticipate this happening en masse in the area and it isn’t the only way we might see an increase in available stock.

Over the past three months, many of us, and many businesses, have embraced remote working – or had it thrust upon us. As we examine in this quarter’s research for the Birmingham office market, remote working is unlikely to replace ‘the office’ anytime soon, but it may change how we use it.

If businesses decide to provide their staff with more flexible working – operating between the office as well as home – the number of staff on-site at any one time is reduced.

A fairly radical example of this would be Birmingham Business Park occupier, Fujitsu’s recent announcement to halve its global office space, which it claims “will introduce a new way of working that promises a more empowering, productive, and creative experience for employees”.

Companies may seek to sublet the space they believe they can free up – often referred to as ‘grey space’, providing it is permitted in their lease or can be negotiated with their landlord.

As for those vacating space, we are highly unlikely to see a list of departures from the business parks this year. This is not least because businesses will need to wait until a lease event to make any such decision. We would hope that those that are struggling at present will find some semblance of normality – or new normality – in the coming quarters and this will quash any knee-jerk reactions to reduce or vacate space.

Push ahead with your plans

Whilst there could be an increase in available stock, it isn’t certain, and we don’t know how much stock might come back. As such, if you are restructuring operations and need to relocate, then you should press ahead with your plans. Similarly, if you view office space that meets your requirements – take it! The demand for office space continues to be strong and the availability of Solihull office space in the short-term is only reducing.

Of course, the pandemic has slowed decision-making, but those deals will take place and options will disappear. You could find the office space you had shortlisted for your business is taken by another occupier, and an ideal alternative doesn’t materialise.

The same is true if you are planning to restructure your operations. Office space in all sizes is in short supply, so the time to act is now.

CGI of Westgate, 21 Homer Road - new development for offices Solihull

Westgate, 21 Homer Road

New office development on the horizon

For those occupiers able to look to least two years down the line, scheduled for delivery in 2022 is a new development of Grade ‘A’ office space in Solihull town centre, delivering much needed new office stock to the Solihull office market.

With site clearance works continuing through lockdown, plans are being shaped for a landmark office scheme called Westgate at 21 Homer Road, providing 114,000 sq ft of office space over 7 floors. The scheme, which is based on the corner of Homer Road and Station Road, is said to also offer an innovative and flexible co-working and collaboration space and will be rated as BREEAM Excellent.

CGI of HS2 Interchange Station - vital infrastructure works for the Solihull office market

Solihull Interchange


The Government’s driving vision for recovering from the coronavirus pandemic is investment in infrastructure – to stimulate the economy and generate jobs.

The most important infrastructure project relevant to the Solihull office market right now, is the £282m scheme at Junction 6 of the M42, for which the consent order was recently granted in May 2020. The works are designed to increase capacity for this important strategic route to support economic growth and planned development in the region, not least HS2.

The scheme will see the construction of a new dual carriageway, a new junction 5A on the M42, two new roundabouts and a pedestrian overbridge.

Then, of course, there’s HS2 and this is going to have a significant impact on the commercial landscape in Solihull. Arden Cross, a 340-acre development site, will be home to the HS2 Interchange Station as well as business, leisure and residential uses. Surrounding it will be the wider UK Central Hub – a major redevelopment project to support 70,000 jobs and bring £6bn a year to the Midlands.

UK Central will be accessed by air, road, rail, metro, sprint bus and HS2. It is set to consist of almost 7m sq ft of commercial space, thousands of homes, hotels and world-leading research and innovation facilities.

Outlook for the Solihull office market

One of the most important things to say is that, at this time, we cannot know the long-term effects of coronavirus on the Solihull office market. As discussed in the topic of available stock and vacating premises – we may only see that when lease breaks occur.

In Q3, many industries will start to make their way back to work – having spent the ‘COVID Quarter’ working from home. We expect to see some of the in-process transactions to complete and for enquiries to move forward.

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 mjones@kwboffice.com.

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Contact Malcolm Jones

0121 233 2330