Birmingham Riding High

A recent report by Colliers International on the Birmingham office market over the last 6 months, painted a picture of rising office take-up driven by occupier expansions and falling availability of office stock in the city.

The city is riding high after the announcement of HSBC’s (210,000 sq ft) relocation of 1,000 London staff to the Arena Central scheme in 2019. Office take up of 340,000 sq ft in the second half of 2014, took the yearly total to over 713,000 sq ft for the year, with over 70% of deals in the core area. Large recent deals include HS2 (97.958 sq ft) at Two Snow Hill, HSBC (37,530 sq ft) at 120 Edmund Street BCU (27,000 sq ft) at NTI Building, BDO (24,307 sq ft) also at Two Snow Hill and Weightmans (14,000 sq ft at St Phillips Point.

Financial (notably Deutsche Bank) and public sector occupiers (mainly skewed by HS2) were the most active in 2014, but the year also saw deals to Vodafone, Hogan Lovells and Amey. There is about 500,000 sq ft of office requirements circulating in Birmingham at the moment. Metropolis is tracking around 30 medium/large searches in the city including PKF Cooper Parry,, London School of Business & Finance and Birmingham Chamber of Commerce amongst others.

In terms of development, Rockspring and Sterling Property Ventures are planning redevelopment of 103 Colmore Row to produce an office scheme of 225,000 sq ft. Bruntwood has purchased the former KPMG Headquarters at 2 Cornwall Street and will begin a major refurbishment and extension of the building this year.

Looking ahead, the city is increasingly garnering mid-level banking operations from London, with Lloyds Bank the latest rumoured to be interesting in boosting its presence in Birmingham. The lack of new schemes and grade A office space across the city is now likely to trigger enquiries from a number of occupiers. There are also over 100 lease expiries due to be resolved by Birmingham tenants over 2015 and 2016.

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