If Sir Michael Lyons' suggestions for moving government jobs away from London and the south-east come to fruition, then Birmingham needs to be able to meet the challenge.
That's the view of Greg Shutt, of Birmingham-based property agent Grenville Smith & Duncan. Sir Michael, former chief executive of Birmingham City Council, and currently the director of the Institute of Local Government Studies at the Birmingham of University, was appointed last year by the Chancellor, Gordon Brown, to investigate the matter.
Mr Shutt comments: "Sir Michael is confident that, with a potential 20,000 jobs on the move from London and the southeast, Birmingham is well placed to help secure the benefits sought by central government.
"These range from cost savings to key departments to improved recruitment and retention and lower labour and accommodation costs."
Sir Michael's report also emphasises the possibility of better service delivery to customers and improved quality of life to employees who make the move, due to lower house prices and commuting times, which are up to half of those endured by staff based in the south, but what are the signs that the anticipated injection of new capital is a realistic proposition?
"If Birmingham is to provide a healthy supply of quality space, inward investment is surely a prerequisite," says Mr Shutt.
Office space take-up in Birmingham city centre last year - 365,000 sq ft - was the lowest level for eight years but the oulook for 2004 is more optimistic, agrees property consultant CB Richard Ellis in the latest UK Regional Offices survey.
According to the report's findings, the major constraint on occupier activity growth will be the lack of available grade A space with only one major scheme - 82,000 sq ft at 134, Edmund Street - due for imminent completion.
However, the balance is likely to be redressed in 2005 with the redevelopment of Baskerville House which will provide 206,000 sq ft of top-grade space. Last year was a retrenchment one for the central Birmingham market following a record year in 2002 when the total was more than 800,000 sq ft.
For some years the average take-up has been 550,000 sq ft but 2003's figures were affected by the limited supply of ready-to-occupy Grade A space and the reluctance of occupiers to make long-term financial commitments.
Only 70,000 sq ft - just under half the first six months total - was taken up in the second half of 2003.
This year's total is already almost guaranteed to be higher as the freehold sale of 247,000 sq ft to the Judiciary Services at the Post & Mail site on Colmore Circus is believed to be imminent. John Batsford, director of office agency in Birmingham, said: "Professional and public services sectors accounted for more than 50 per cent of the take-up.
"The Office of the Deputy Prime Minister took 65,000 sq ft at 5 St Phillips Place and accountancy firms took more than 40,000 sq ft of the total space let.
"A number of large firms from the professional sector, especially legal services, are negotiating for new space."
Wragge & Co is rumoured to have a requirement for more than 200,000 sq ft, Hammonds 70,000 sq ft, Cobbetts Lee Crowder 40,000 sq ft and Mills & Reeve between 20-25,000 sq ft.
Availability of space in the city centre is 1.2 million sq ft, unchanged for a year, but the amount of second-hand space has increased over the past two years, with occupiers releasing surplus accommodation on to the market.
The investment market, with #147 million of transactions last year, shows no signs of abating. It is being stimulated by the city's prime pitch, Colmore Row, being defined as a disadvantaged area for Stamp Duty provision in last year's Budget .
Major transactions in 2003 were #57 million by Standard Life for 130,000 sq ft in Cornwall Street and #24 million by a private Irish syndicate for 63,000 sq ft at Direct Line House, Livery Street.
Currently, there are several large investments under negotiation and due to complete. These include 30,000 sq ft at Edmund House, Newhall Street to Morley for #21 million.
Strong demand has reduced prime office yields, now standing at 6.65 per cent. Prime rents are holding at #27.50 per sq ft in the city centre. Occupiers who have been in the market for a while are obtaining very favourable lease terms with typical incentives of 12-18 months rent free in return for entering into a 15-year lease.
The shortage of Grade A space may encourage rental value growth over the next 12 months with #30 per sq ft anticipated by many to be achieved in the next two years. Nationally, the survey reports, developers remain reluctant to build speculatively, overseas investors are extending their reach into the regions and the regional office markets could attract a significant weight of institutional money this year.
The survey says: "It is likely that 2003 will prove to be the low point of a remarkably shallow downturn in activity and growth in the UK's main regional office markets."
Mr Shutt believes existing and pipeline development will go some way to meeting the potential rise in demand.
The Eastside regeneration area will also boost the city's property reserves with 420 acres of development spreading from the Bullring out towards the Middle Ring Road and Aston Science Park - a mix of office, leisure, learning and technology, as well as residential use, which will take shape over the next five to 10 years.
There is already some two million sq ft of office space in train thanks to David McLean and the Eastside Partnership within five minutes' walk of the new retail centre.