According to research conducted by property consultancy GVA, the M42 corridor out-of-town office market saw a significant upswing in activity last year, with a total of 420,00 sq ft of deals being made. This is nearly double 2013’s total of 224,395 sq ft.
The deals involved a range of businesses from SMEs to multi nationals at sites including Trinity Park, Birmingham Business Park, Fore Business Park and Blythe Valley Park (pictured).
In the first quarter of the year, there were 59,000 sq ft of deals done, with the largest being 8.750 sq ft that was let to UKDN at Birmingham Business Park. Throughout the second quarter, the market continued to thrive, with 22,000 sq ft taken by Pinewood Technology and 26,000 sq ft being occupied by UTC at Fore Business Park.
Meanwhile, the largest transaction to occur in that part of the year was with Birmingham Business Park, which saw IMI and WM housing occupy 35,933 sq ft and 27,134 sq ft.
Associate at GVA, Adrian Griffith, said “The activity we’ve seen in this market, particularly in the core area between junctions 4 and 6 of the M42 is a clear indication of improving business confidence, coupled with the continued squeeze on availability for good quality accommodation of a certain size.
“From a landlord’s perspective, both Blythe Valley Park and Birmingham Business Park are almost completely let, reflecting levels of demand that we haven’t seen for some time”.
Mr Griffith also said that incentives at some sites dropped by 40%-60%, as a result of the rise in demand. He added that while rents in some quarters have crept up, there has been a realignment of rental values as landlords consider the value of their stock against more achievable rental levels.
According to GVA, one reason for the upturn in demand in the area may be new infrastructure developments such as the extension of Birmingham Airport which is currently underway.
Mr Griffith is optimistic about the prospects for the M42 corridor market in 2015 saying that, towards the end of the year, he could see a number of larger deals being signed.
Story: Chris Grigorovsky
