Facebook - Birmingham Business Twitter - Birmingham Business Instagram - Birmingham Business
https://science2industry.co.uk https://www.iscoydpark.com

Number of new developments drops

Birmingham has seen the number of new developments across the centre of the city drop by 50 per cent during 2019 as the construction industry grapples with Brexit and tougher economic conditions.

But despite the drop in new starts from 23 to 11, the latest Deloitte Real Estate Birmingham Crane Survey shows activity across the city remains high with the number of current schemes under construction up to 41 compared to 38 in 2018.

“Both residential and office schemes continue to perform well as both domestic and foreign investors see Birmingham as the UK city of choice. Still the number one city outside of London and the South East for attracting foreign direct investment (FDI), developers are responding to the need for city centre living and Grade A office space with a mix of major refurbishments and new build schemes,” says Edwin Bray, partner at Deloitte Real Estate and author of this year’s survey.

The 11 new starts recorded in this survey are split across the residential and office sectors at seven and four respectively.

A new record has been set for the city as the volume of office space delivered to market hit 775,000 sq ft across a mix of new build and substantially refurbished office space. This surpasses the previous Birmingham Crane Survey record set in 2017 by more than 250,000 sq ft.

“Three Snowhill and One and Two Chamberlain Square have all completed with BT Group announcing it will move to Three Snowhill at the end of the year. One Chamberlain Square is fully let, with Two Chamberlain Square part pre-let, allowing the developer to press on with the next phase,” says Bray.

The investment in new office space continues with four new schemes, taking the total to seven under construction. Of the total office space under construction, approximately half (53%) is pre-let, up from 33% in 2018, suggesting sustained confidence in the occupier market.

For the fourth consecutive year, office development surpasses 1 million sq ft under construction.

“The growing demand for flexible office space is still attracting domestic and international investors. The sale of Priory Court and the Lewis Building to Gulf Islamic Investments and 11 Brindleyplace to Blue Noble LLP, both signify the attraction of the Birmingham office market as a preferred destination offering good prospects for future growth. 2019 has also seen the demand for space equally matched between the private and public sector,” says Bray.

According to this year’s Birmingham Crane Survey, residential development continues to surge ahead, maintaining record levels of units currently under construction. This includes seven major new residential schemes, taking the total to 26, and surpasses the record-breaking levels recorded in the 2019 report with 5,506 units currently under construction, up over five per cent on the previous year.

“Residential development continues to dominate, delivering over 1,000 units in 2019, well above the ten year average of 465,” adds Bray.

“Developers are still vying for key strategic sites as the demand for city living increases, which was evident at the turn of the year with the announcement that Broad Street 100 will go ahead and deliver over 500 luxury apartments in addition to workshop and leisure facilities.

“We’re seeing a trend for flexible living space to accommodate the city’s professionals and families, and the crane survey shows a strong pipeline of new developments on the horizon with 22 already signposted to start in the near future.

“The Jewellery Quarter and Westside remain attractive to developers and occupiers, although we have seen a tilt towards high-end luxury apartments which may cause an over-supply in the sector,” added Bray.

According to this year’s survey, the city’s purpose-built student accommodation (PBSA) sector recorded no new starts and whilst 810 new student beds were completed, it is well below the levels achieved in 2018. However, with three schemes underway, 2020 looks to be a record year for the sector with an estimated 1,850 units due to be delivered.

Similarly, whilst there are schemes currently in development for the hotel sector there are no new additions for 2019 despite the pressure for high quality accommodation required prior to the 2022 Commonwealth Games.

“Although the drop in new schemes from 23 to 11 suggests construction and confidence in the city is falling, activity levels remain high and our most recent CFO survey underlines there is a marked increase in sentiment and optimism linked largely to more political certainty around the year ahead,” says Bray.

“There is already a strong pipeline, particularly within the residential sector, and we anticipate this will continue. As pressure grows in the city core it’s inevitable that designers will look to maximise scarce land by pushing up higher. A look back at the volume of recent planning applications underlines how keen developers are to change the horizon. 

“The dawn of 5G and its rollout across the West Midlands, along with the new 15 year masterplan for Birmingham Airport with the aim of bringing in five million more passengers per year, you can see why Birmingham has been labelled the UK’s most investible city.

“The year ahead will see important changes being implemented which have already started to influence design, change travel plans and promote a cleaner environment. Whilst some of this may be difficult in the short term, it’s absolutely essential for the city’s success.

“2020 has the potential to be a record-breaking year for real estate development, you only have to walk around the city to see cranes on the skyline. We just need to carry on building to meet demand,” added Bray.

In its 18th year, the Deloitte Real Estate Birmingham Crane Survey measures the volume of development taking place across the city centre and its impact.

Pictured: Edwin Bray of Deloitte Real Estate


Construction suppliers open city centre office

Taylor Maxwell takes on ground floor space

4th December 2019

Deal secured on city centre site

Real estate specialists complete acquisition

19th September 2019

£4.75m sale of HQ marks great future for Chamber

Leaders say the move will enhance long-term finances

27th August 2020

Business park plans submitted

Proposed project would create mix of commercial units

12th March 2021

Construction expert appointed by law firm

Lawyer with almost 20 years' experience in the sector joins growing team

16th August 2019

Construction contractor delivers warehouse

Multi-million pound contract is completed

6th November 2020

Senior associate joins property team

Law firm appoints commercial property expert

28th July 2020

Property investment company continues to deliver

Birmingham firm sees good profit growth

28th October 2019

Consultancy moves to new city offices

Growing team and business boom leads to relocation

8th August 2019

Bumper number of deals for property experts

Consultancy enjoys successful period of business

1st November 2019

Law firm appoints new city office head

Award-winning education and real estate expert will lead the team

19th May 2021

Marco Abonandi

West Midlands business development manager at GF Tomlinson

23rd October 2020

More big office deals for city

Birmingham lands two of the largest regional acquisitions

12th November 2019

Development sells out before work starts

Apartments snapped up within weeks of launch

14th August 2019

Firm sees roaring start to new year

Property experts announce new lettings and renewals

24th January 2020