Birmingham office market bounces back
Birmingham’s office market returned to growth in 2021, with take-up just 10% below the 10-year average, according to real estate services specialist JLL’s annual UK Big Six report.
Documenting the growth of the office markets in the UK’s largest regional cities, JLL’s analysis shows that office leasing volumes in Birmingham reached 656,000 sq ft by the end of 2021. The growth falls in line with that of the wider Big Six – which also includes Bristol, Edinburgh, Glasgow, Leeds and Manchester – with combined leasing volumes remaining 11% below the 10-year average at 4.1m sq ft.
From an investment perspective, the Big Six saw its strongest Q4 since 2018 (£523m), with £1.8bn poured into regional markets across the year. The market in Birmingham remained subdued, however, with just £107m worth of deals taking place in 2021, well below the 10-year average of £370m.
Top 10 transactions
| Address | City | Tenant | Size (sq ft) |
| Circle Square | Manchester | Roku | 115,066 |
| City Square House | Leeds | DLA Piper UK LLP | 83,015 |
| Manchester Goods Yard | Manchester | Cloud Imperium | 81,113 |
| Bdg 6, Buchanan Wharf | Glasgow | Student Loans Company | 75,000 |
| 1 Trinity Quay | Bristol | University of Bristol | 74,373 |
| One Centenary Way | Birmingham | Arup | 68,481 |
| Drapers Yard | Leeds | Labcorp | 68,345 |
| 20 West Register Street | Edinburgh | FNZ | 61,239 |
| Bridgewater House | Bristol | BBC Studios | 60,253 |
| 2 Freer Street | Edinburgh | FanDuel | 58,870 |
Overall, vacancy rates in Birmingham increased in Q4 to 7.5% alongside the new vacancy rate which now stands at 1.8%. This is largely due to the completion of the partially pre-let 103 Colmore Row, which brought just over 130,000 sq ft of available space to the market. The continued occupier trend for a flight to quality means that demand for good quality space will be maintained throughout 2022. The city’s development pipeline, dominated by refurbishment projects, also remains active with 597,400 sq ft of speculative space currently under construction – the vast majority of which is due to complete in 2022.
Jonathan Carmalt, office agency director at JLL in the Midlands, said:“The office markets of the Big Six act as an important barometer for the health of the regions, and these figures point to a positive post-Covid resurgence in Birmingham which we’re seeing carry through from the second half of last year into 2022. Real estate and infrastructure investment are at the centre of rebalancing the UK’s unequal economic geography and surpassing pre-pandemic occupancy levels this year is likely to spell good news for local growth.”
Elaine Rossall, head of UK offices research at JLL, said: “We’ve seen a significant uptick in city footfall in recent weeks and, as firms look to facilitate more collaborative and attractive workspaces for their teams, we can expect new build space, especially those with a high sustainability, wellness and smart technology focus, to set new standards across the Big Six. That said, we should be mindful of the gap between prime space and the rest widening, with occupants and the race to net zero necessitating investment across the board.”
