Birmingham's Hub-And-Spoke Battle Commences
Investors have begun to move in on prime Birmingham out-of-town office space as the fallout from the coronavirus pandemic remains unclear.
Hillview has acquired the three self-contained office buildings at Kings Court at Birmingham Business Park in a £9.7M deal with Catalyst Capital. The net initial yield on the buildings, which total 51K SF, was 8.72%, Business Desk reported.
The 148-acre Birmingham Business Park is widely regarded as one of the best in the UK, having worked hard to improve amenity provision.
The deal comes as partisans of the Birmingham city-centre office market begin a fight back against out-of-town challengers.
“There have been suggestions that a hub-and-spoke model for flexible offices could become a reality in Birmingham but I really don’t believe it will happen,” Overbury Development Manager and British Council for Offices Midlands Chair Danny Parmar said.
“A central location and smaller flexible offices works for London-based businesses that can benefit from estates in outlying areas such as Watford or Croydon. I don’t think that Birmingham is big enough geographically to warrant that kind of model. It will take too long to put in place, it will be too expensive and a regional hub will never be able to replicate the collaborative buzz of a successful office.
“Public transport is one of the main issues we face before a vaccine can be found, but I think it’s far more likely that employers would pay for their staff to travel to work via Uber rather than investing in hub offices on the city fringes,” Parmar said.