Dip in demand damaging Birmingham office market
A LACK of chunky requirements for office space in the centre of Birmingham will mean take up figures in 2012 are likely to be lower than 2011.
Speaking at Jones Lang LaSalle’s Midlands ‘Property Predictions’ event in Birmingham this week, its head of offices Jon Carmalt predicted that demand will most likely ebb to between 550,000 and 600,000 sq ft. The figure for 2011 was 670,000 sq ft.
“Take up levels held up pretty well in 2011 and that wasn’t based on sector-specific transactions,” he said.
“This year we are probably lacking the larger, named active requirements.
“Occupier sentiment is weaker than it was 12 months ago. Companies are mainly interested in cost savings rather than expansion.
“We will still get churn but I suspect the take up generally will be down by about 10%.”
Elsewhere at the event, investment director Allan Wilson was bullish about prospects in the industrial sector, saying there was funding available for pre-lets, where the lease and tenant are right. However, “the sweet spot is small and the number of potential funders reduces at lots of less than £10 million,” he said.
And Nick Webb, part of Jones Lang LaSalle’s retail team in the Midlands, said the trend for ’clicks and bricks’ operations will continue and predicted an increasing polarisation between prime and secondary space on the High Street.
