M&G Real Estate has announced the largest letting of 2024 in Birmingham’s central business district (CBD) at its 420,000 sq ft Three Snowhill office scheme with a 10-year lease to National Highways. It signposts a rebound in the city’s commercial real estate market, which has seen a record Q1 2024 take-up of 203,000 sq ft – the highest since 2020.
National Highways – the government-owned entity responsible for England’s motorways and A roads – is relocating from its current Midlands HQ at The Cube and Colmore Square at the end of the year and will take 58,697 sq ft.
Demand for high-quality office space and significant investments in infrastructure is driving the resurgence in Birmingham’s commercial real estate market where rents have seen a 23% increase since the end of 2019. With high demand and limited prime supply, forecasts suggest a further 13% increase in prime rents over the next five years, potentially reaching £48 per sq ft by the end of 2028, underscoring the continuing appeal of high-quality, well-located office space in the city.
Completed in 2020, Three Snowhill is Birmingham’s largest office building and was honoured with the British Council for Offices’ ‘Best Commercial Workplace’ regional award in 2022. BT – the building’s anchor tenant – occupies 283,000 sq ft, sharing the expansive 4-acre Snowhill Estate with organisations including KPMG, BDO, Barclays, and DWF.
Aaron Pope, Portfolio Director of Offices Asset Management at M&G Real Estate, commented: “This significant letting to National Highways underscores Three Snow Hill’s premier status within Birmingham’s business landscape and reflects the ongoing demand for high-quality, well-located office space. The positive trends we are seeing in the city’s commercial real estate market, including robust transaction activity and significant infrastructure investments, continue to enhance its attractiveness as a prime business hub, which will help to drive returns for our clients.”
National Highways Director of Estates, Services and Facilities, Steve Cooke, adds: “The move will enable us to bring our Birmingham-based teams together under one roof at a convenient location in the centre of the city enabling better collaborative working and building on the community workplace feel that we have developed.
“It is essential to us that our staff are happy with their workplace so when our office leases were coming to an end, we worked hard to find the most suitable space available. We are delighted that our new home in Birmingham has close transport links, flexible work space and excellent wellbeing facilities. This move aligns with our workplace and location strategy to create better, greener and smaller workplaces.”