Birmingham is set to benefit as the war for talent intensifies, with businesses looking to the regions says the latest Big 6 report from global real estate advisor, JLL.
The cost of working and buying in the Capital has become so high, that it is impacting on business location decisions and here the Big 6 which is Birmingham, Bristol, Leeds, Manchester, Edinburgh and Glasgow will gain.
56% of companies questioned for the report said that the issue of staff retention and attraction was increasingly being talked about by CEO’s in the capital.
“We’ve already seen a number of early north-shorers move such as Deutsche Bank and HSBC.” says Jonathan Carmalt, JLL’s office agency director. “Increased connectivity of the regions, cost of living and agile working are all making moving a much more realistic option.
“Access to talent is posing a very real threat to business productivity in the Capital. We’re increasingly seeing our clients plan their real estate strategies around the needs of future talent requirements and this is driving some major decisions around their choice of locations.”
Graham Taylor, director from JLL’s Building Consultancy team added: “The 2017 business rates revaluation could be the final straw. In London this will make rates payable over £30 sq ft compared to £12-£15 in the Big Six markets.”
London’s on-going space dilemma is another driver for occupier requirements to shift to the regions. London office supply is at an all-time low. Currently there are 18 million sq ft of live office requirements and just 7 million sq ft under construction bringing a circa 11 million sq ft shortfall, which will also play to the regional agenda.
Jonathan Carmalt continues: “Birmingham’s profile is at an all time high and it’s essential we capitalise on a growing north-shoring agenda to demonstrate why moving to the regions is no longer a compromise. We’ve got first class amenities, excellent universities and skilled professionals to support a change of location.”
The question of attracting and retaining the best talent is also a key issue for home grown companies too and contributed to a record number of occupiers pursuing pre-lets in 2015.
2015 saw a surge in pre-leasing activity across the Big 6 regional offices with 850,000 sq ft let across 17 transactions compared with 15 over the previous five years (2010-14).
Refurbishment and rental growth will be a key theme for 2016. In Birmingham a range of comprehensive refurbishments will complete later this year, with the new build options delivering from 2018 onwards.