Sun Shines On 320K SF Q2 Birmingham Office Deals
Birmingham's office market transacted 320K SF in the second quarter of 2019, outpacing Q1 thanks largely to a spate of deals at Hines' Brindleyplace estate.
Office take-up in Q2 in the central Birmingham office market totalled 321K SF in 30 deals, the Birmingham Office Market Forum said.
This means first half take-up was 515K SF, making it likely the 2019 total will exceed the disappointing 754K SF recorded in 2018.
First half take-up is the best since 2015 when HSBC committed to its new HQ and is appreciably up on the same period in 2018 (318K SF) and 2017 (248K SF).
Brindleyplace has been particularly active. Last week flexible workspace provider WeWork agreed to open its third, and largest, city centre base, leasing almost 100K SF over seven floors at Six Brindleyplace. Earlier, Birmingham 2022, the organisation behind the city’s hosting of the 2022 Commonwealth Games, signed up for 73K SF over six floors at One Brindleyplace.
While leasing is up, Grade A supply across the city is at its lowest level in 20 years, dropping by 33% in the last 12 months, Avison Young said.
“There is a pipeline of approximately 1M SF of new Grade A space in the city centre over the next few years; however, a large percentage of this is already under offer," Savills Director Ben Thacker said.
"There is also a severely restricted supply of high-quality refurbishments as well, so Brindleyplace is in an excellent position to capitalise on this, and modernising existing buildings is providing occupiers with forward-thinking office space, well placed to meet the rapidly changing business and social needs."
Brokers expect take-up to remain healthy during the summer.
“Birmingham’s city centre office market is really thriving at the moment, and undoubtedly Brindleyplace is one of the driving forces behind the success we’ve seen in the first half of 2019," Avison Young principal Charles Toogood said.
Asset manager Hines is continuing to invest in buildings on the estate, having recently committed to a £3M refurbishment of communal areas and vacant suites at Three and Four Brindleyplace. This follows the £4M refit of the Oozells Building.