Are business space rents out of reach?

Business space rents in Birmingham’s Jewellery Quarter are skyrocketing, leaving them out of reach for many small business owners.

That's the opinion of Ed Siddall Jones, who runs a property consultancy based in The Mint in Icknield Street, who says commercial rents in the area have risen from £10-12 per sq ft to up to a record £17 per sq ft in the last year, making them unaffordable for start-up and smaller businesses. He said the lack of available space and pipeline is also driving up rents.

Mr Siddall Jones said: “When new space does come to the market it is quickly snapped up, demonstrating the levels of demand.

“We recently let two 500 sq ft and two 900 sq ft units above Folium restaurant in Caroline St, just off St Paul’s Square, at £19 per sq ft, including service charge. We could have let them ten times over.

“Incubation space for indigenous industries in particular is non-existent. This threatens the very character of this unique area. Graduates from the internationally-renowned School of Jewellery are among those hard pressed to find premises from which to make and sell their wares.”

According to Mr Siddall Jones, existing local traders are also concerned by the divestment of a number of properties owned by Birmingham City Council in the historic area. Premises in the Vyse Street triangle, Caroline Street, Pitsford Street and Summer Hill Terrace have been put up for sale by the local authority.

“The council is keen to cash in on the Jewellery Quarter’s cachet, but its policy is confusing and contradictory. On the one hand it is selling off much-needed smaller units from its own portfolio, whilst deterring developers from building out some of the larger sites in the district on the grounds that these currently provide employment.

“The reality is there is no requirement from large-scale manufacturers or heavy industry for sites in the Jewellery Quarter. The buildings are not fit for purpose and congestion charging is on the horizon – what business will want to add to its overhead costs by paying £50 for each HGV movement?

“Yet the council has prevented the re-development of a number of ‘crinkly tin’ buildings with no architectural merit under the guise of protecting employment.

“Take the AE Harris and the Mr Tyre sites. The businesses have jointly almost 200,000 sq ft of premises spread across eight acres of land yet employ fewer than 70 people between them. It’s madness when you consider the requirements coming across my desk every day. Whilst these jobs will move, the reality is many more will be created when new homes are built and new retail and office space is created.

“There is undoubtedly an opportunity to create new jobs in the Jewellery Quarter, but they won’t be in manufacturing. The demand for new space is coming from jewellery makers and sellers, professional services firms and, increasingly, the digital and creative communities. They are crying out for space here that just doesn’t exist. The sooner the council appreciates the need to recalibrate our commercial space offer the better.”

Mr Siddall Jones says incubation space – for jewellery makers and other artisan trades; open-plan office space, of which there is a dearth in the Jewellery Quarter; and new ground-floor retail and leisure units, are the priority.

He said: “The economy in the Jewellery Quarter has shifted. There are more people living here and it has become an area for learning, with both schools and universities based here. Whilst we must retain the area’s heritage and character – which is very much part of its charm and draw – it’s no good preserving it in aspic. We must acknowledge that times have changed and the jobs market is very different now.”