Record construction levels identify Birmingham as global business destination
An unprecedented level of new development across Birmingham has seen the city top an influential regional survey.
The Deloitte Regional Crane Survey identifies current levels of development activity and examines the key sectors and external market factors influencing city centre construction.
The latest survey, released today, shows a record-level increase in construction across the city centre, with Birmingham reinforcing its place as a global destination for business, talent and tourism.
Throughout last year there was a record number of cranes on the city skyline with developers forging ahead with new schemes in every sector. Financial and professional services firms are growing and with mounting activity around HS2, the city centre is stretching upwards and outwards to meet demand.
The key findings show:
• 1.45m sq ft of office space under construction – a 50% increase on the previous year
• 7 new office starts totalling 778,612 sq ft – the highest number in the survey’s history
• A surge in residential development with more than 2,300 units being delivered over the next three years
• 1,166 student bed spaces under construction – 40% on the previous year
• 508 hotel bed spaces under construction
• 7 completed schemes since the last survey
The 1.45m sq ft of new office space under construction in 2016, compares with 969,000 sq ft in the previous year. The surge signals the highest level of activity since the report was first published in 2002, and confirms rising developer confidence. 
Edwin Bray, partner at Deloitte Real Estate and author of the Crane Survey, said: “Improvements in transport links and major infrastructure works have opened up new development opportunities in areas that would have been considered peripheral just a few years ago.
“This really is a new era for the city as it grows and matures, expanding both upwards and outwards.
“Developer confidence is reinforced by the growth in financial services businesses choosing to headquarter here, activity stimulated by HS2 and a previous lack of Grade A supply available for immediate office occupation.”
Similar trends are also seen across other sectors covered within the report, with residential construction activity reaching levels not seen since 2005.
“The strong and sustained residential demand is seen in both the rental and owner occupier markets, with new schemes totalling 2,331 units spread across the city centre, Jewellery Quarter, Digbeth and Edgbaston,” added Mr Bray.
“Critically, there remain further sites across the city in demolition – which, whilst we don’t record these in the survey – shows a sustainable positive outlook.”
Much of the residential development is a consequence of Birmingham City Council’s Big City Plan, announced in 2010, which set out ambitious targets for more than 5,000 new homes in the next 10 years.
The latest Crane Survey also identifies 1,166 student bed-spaces in development, illustrating the continued expansion of the student housing sector in Birmingham. The demand is driven by a more consumer-conscious student looking for good accommodation standards to support their studies.
Two schemes are located near Aston University and one in the Chinatown area.
One sector highlighted in the report is health and life sciences, referencing the new Cancer and Rare diseases centre in Birmingham Children’s Hospital (82,333 sq ft), the first of its kind in the UK, which completes in Q4 2017. This further strengthens the region’s reputation and offer in this sector, alongside the Queen Elizabeth Hospital and the recently opened £50m Birmingham Dental Hospital.
Mr Bray concludes: “Our report underlines the fact that all sectors are active, supported by a genuine demand and a demonstrable pipeline for future opportunities. The city scores well on logistics, culture and heritage, connectivity, diversity, education and value for money – and its appeal continues to grow and spread across Europe and the world.”
