2023-11-23-莱坊-UK_Cities_Birmingham_Q3_2023_1页_219kb

Birmingham Office Market Summary

Core Content

The Birmingham office market is currently experiencing a mix of demand and supply dynamics, with notable activity in both occupational and investment sectors. The data highlights trends in space take-up, vacancy rates, and investment volumes, providing a snapshot of the market's health and direction.

Occupational Demand

Key Statistics

• Take up (sq ft): 131,504
• Number of Deals: 18
• Most Active Sector: Finance, Banking & Insurance
• Grade A Availability (sq ft): 367,983
• Vacancy Rate: 3.0%

Insights

• The market is seeing a steady level of demand, with a total take-up of 131,504 square feet.
• The Finance, Banking & Insurance sector is the most active, indicating strong interest from these industries in Birmingham's office space.
• Grade A availability remains at 367,983 square feet, suggesting that high-quality office space is still available for potential tenants.
• The vacancy rate is low at 3.0%, reflecting strong demand and limited supply in the market.

Investment Activity

Key Statistics

• Investment Volumes (£m): £132.4
• Quarter vs 10-Year Average: +20%
• Number of Deals: 3
• Prime City Centre Return: 6.25%
• Prime OOT Return: 7.25%
• Forecast Total Return (PA 2023-2027): 3.0%

Insights

• Investment volumes have increased by 20% compared to the 10-year average, indicating a positive outlook for the market.
• Prime City Centre and Prime OOT (Out of Town) assets are showing different return expectations, with Prime OOT offering a slightly higher return.
• The forecast total return for the period 2023–2027 is 3.0%, which suggests a moderate growth trajectory for investors.
• The increase in investment activity is likely driven by the strong demand and low vacancy rates observed in the occupational sector.

Notable Transactions

• Building: 6 Brindleyplace
• Occupier: Lloyds Bank
• Size (sq ft): 59,896

This transaction reflects the ongoing interest from major occupiers in prime office locations within the city centre.

Investment Volumes and Returns

• The total investment volume in the quarter was £132.4 million, a significant increase over the 10-year average.
• There were three investment deals recorded, showing a concentrated but active investment environment.
• Prime City Centre and Prime OOT assets are expected to yield returns of 6.25% and 7.25%, respectively.
• The overall forecast total return for the market is 3.0% per annum from 2023 to 2027, which is in line with broader market expectations.

Conclusion

Birmingham's office market is showing resilience and growth, supported by strong demand from the Finance, Banking & Insurance sector and a low vacancy rate. Investment activity is also on the rise, with a 20% increase in volumes compared to the 10-year average. The market is expected to deliver a moderate total return of 3.0% per annum over the next few years, driven by the continued demand for high-quality office space. Notable transactions, such as the one involving Lloyds Bank at 6 Brindleyplace, highlight the market's attractiveness to major occupiers and investors.