HS2’s decision to move to Birmingham will create massive opportunities for the city’s office market – and huge challenges, experts claim.
The first phase of the 100,000 sq ft offices will come on stream in 2015, meaning only two Grade A options were available – Colmore Plaza and Two Snow Hill.
JLL chairman Jan Thompson said the move, which comes as Deutsche Bank significantly ramps up employment in the city, would have undoubted impact on demand.
“I think they’ve made a great choice in going for the Ballymore scheme at Snow Hill,” he said.
“It’s a landmark building, and right at the heart of the traditional Colmore Row business district.”
The veteran property scene observer, who advised Deutsche Bank on their move to Birmingham’s Brindleyplace from London, says today’s news will have a huge strategic impact on the city’s core office market.
“In the short-term, the removal of 100,000 sq ft of space will eat up available stock, which will then kick-start a new wave of office developments, some on a speculative basis, which is certainly much needed,” said Thompson.
“In the longer-term, we’ll see a new office quarter created around Curzon Street. Now everyone knows the construction HQ is coming to Birmingham, companies will be scrambling to take space in the same area, so we’ll have an HS2 supply chain here.
“The initial 100,000 sq ft letting is great news, for the property market and in terms of job creation, but I’d expect to see that figure doubled, perhaps even trebled, in the medium-term.
“At the same time, those companies and organisations which have been mulling over relocations within the city, to new Grade A locations, notably Two Snow Hill and Colmore Plaza, will really have to act quickly, or there’ll be no decent chunks of space available, until the new schemes are brought forward.”