Talking Business: Still no appetite for development amongst funders
ONE of the region’s leading property professionals says it remains extremely difficult for developers to get schemes off the ground.
Anthony Leonard, director of Two Snowhill and Brindleyplace owner Hines UK, said: “No one has tried harder than us over the last few years to get funding for office space development in the top four or six cities outside London in the UK.
“But any element of speculative space and people aren’t interested.”
This story forms part of a supplement from TheBusinessDesk.com based on our Talking Business series of interviews, carried out in partnership with KPMG. Click here to download it.
The problem is exacerbated by a lack of confidence amongst businesses generally which means they are reluctant to make big decisions about moving.
Leonard is concerned that a lack of development activity now could cause problems for the central Birmingham market later on.
“At Two Snowhill it will be four years from our first conversation to fit out. So if you started a conversation today you would be looking at delivering it in 2017 or maybe 2018,” he said.
“So even if we assume take up is half of that of the last 20 years we will be desperate for space by then.
“The problem is the lag. In a year or two’s time people will realise that there is no space.”
From an investment perspective, Leonard says there is not a great deal of demand for anything outside central London.
“People see London as being part of the global economy and the rest of the country they see as part of the English economy,” he said.