A Little Extra Love Helps Edgbaston's Office Market Rebound
In normal times a £2M office refurbishment isn’t a big deal. But these are not normal times, and Aberdeen Standard Investment’s decision to press ahead with the refurbishment of the 16-storey office block at 54 Hagley Road, Edgbaston, suggests landlords think Birmingham’s office market will rebound.
The move comes with a hint that Aberdeen Standard think edge-of-town-accessible locations may have a distinct role in the post-pandemic office scene.
Five floors of the 147K SF building will be modernised as part of a continued investment strategy. Contractor Morgan Lovell has been appointed to deliver a full ground-floor refurbishment, with a new reception area , a café, three meeting rooms, a conference facility that will double up as a fitness studio, locker and shower facilities, and new bike stores.
A programme of office refurbishment is also underway, with refurbished suites for occupiers with between 20 and 200 staff expected to be available later in the summer. Refurbishment work is expected to be completed by November.
“With Edgbaston becoming ever more popular as a place to do business, socialise and live, the investment commitment to improving this premium office building will undoubtedly pay dividends. The works will also complete in advance of the new Metro tram works, which will provide a tram stop right outside the building, adding to its great connectivity,” Aberdeen Standard Senior Asset Manager Cameron Mackay said.
“Edgbaston is outside Birmingham’s congestion charge area, with a car parking ratio of one space to 500 SF, as opposed to one to 2,500 in the city centre, and rents of £650 per space compared with £2,500 in the city centre. Figures like that are a real pull-factor for occupiers,” Jennings said.
“But the real impact will come in six to nine months when the trams arrive, and once we have the trams the COVID effect will disappear. That is when Edgbaston will have its moment.”
Smaller businesses are still active in the Edgbaston market, with several deals in progress where landlords offer modest additional incentives.
“A little extra rent-free to help the tenant move in has overcome doubts about whether they needed as much space as they did before the pandemic,” Jennings said.