Take-up levels in Birmingham’s city centre and out-of-town office markets have remained ahead of the five-year quarterly average, despite uncertainty caused by the EU referendum.
According to Bilfinger GVA’s latest Big Nine research, market uncertainty leading up to the Brexit vote affected the number of deals, which were down slightly. However, a small number of larger deals pushed the quarterly figures to 15% above the average. Network Rail’s 83,000 sq ft letting at Baskerville House was the largest to have taken place in any of the nine regional cities covered in the report.
Meanwhile, Birmingham’s out-of-town market saw a lift against the five-year quarterly average of 90,142 sq ft, with 102,649 sq ft of deals, led by Uniper’s 32,700 sq ft letting at Birmingham Business Park.
Coupled with a record-breaking Q1, Birmingham has transacted more than 500,000 sq ft of deals in the first half of the year, for the second year running.
Charles Toogood, senior director at Bilfinger GVA, said: “Despite the uncertainty as we approached June’s referendum, there was still strong confidence, with viewing, activity and enquiry levels maintained.
“The limited availability of good quality stock is due to continue for at least the next 12 months, providing a degree of insulation.”
Nationally, take-up throughout the Big Nine office markets during Q2 2016 was 3% below the five-year quarterly average.
Carl Potter, senior director and national head of offices at Bilfinger GVA, said: “Aside from Cardiff, Bristol, Birmingham and Glasgow, each of which saw significant deals to record above average take-up, the other five city centres saw activity slowing as had been expected in the lead up to the referendum.
“The second quarter has held up reasonably well. Some significant deals have completed in the public and insurance sectors and underlying demand across the Big Nine remains strong, particularly given the re-organisation of the public sector estate and a large number of private sector lease events.
Potter said that some occupiers had been reviewing their position in light of Brexit, adding: “it is likely that this will affect take-up for the second half of the year. Nonetheless, it is too early to judge how significant this will be.
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