Central Birmingham’s office market is suffering a dearth of grade A space, according Jones Lang LaSalle’s West Midlands office review.
The report states for the whole region total active demand for office space at the mid-year stood around 564,000 sq m (6.7m sq ft), with 48% of demand coming from the business services sector while 24% came from the finance and insurance sectors.
Take-up in the first half stood at 51,400 sq m (553,000 sq ft) with grade A accounting for half the total. Central Birmingham’s take-up was 32,000 sq m (344,500 sq ft) – 62% of the total.
JLL’s Ian Martin said that a city centre building could attract rents of £270 per sq m (£25 per sq ft), while out-of-town rents for new space average £200 per sq m (£18 per sq ft).
The firm’s industrial review for the region said industrial land values and rents had increased because of strong demand.
Average rents across the region rose by 8% to £56 per sq m (£5.20 per sq ft) during the first half of 1999. And top land values are now achieving up to £720,000 per ha (£300,000 per acre). The Heartlands area now fetching £250,000 per acre, £50,000 more than two years ago.
According to Peter Cleary of the Birmingham Alliance and director at Land Securities Properties, the city’s lack of space spills over into the retail sector. Speaking at Wragge & Co’s limited partnerships seminar in Birmingham on Monday, he said: “Birmingham’s catchment is double that of Glasgow and Newcastle, but it has half the available retail space.”
EGi 023/12/99
