Occupiers continued to flock to office space along the M42 corridor during the second quarter of 2019, according to Birmingham-based agents KWB.
Malcolm Jones, head of office agency, calculates that 13 transactions were completed in the three-month spell, accounting for 60,000 sq ft of Grade A space, of which KWB was involved in nine.
The figure is ahead of the same period in 2018 – when just over 55,000 sq ft changed hands via 14 deals – underlining the area’s continued appeal.
“It’s very pleasing to see the market ahead of Q2 a year ago, given the ongoing political and economic uncertainty, and judging by inquiry levels, we’ll see a strong third quarter because the fundamentals of the M42 corridor and Solihull are so strong,” says Jones.
“The connectivity via road, rail and air is excellent, even before the new Birmingham Interchange comes on stream and HS2 arrives, the labour market is always buoyant, and of course, it’s a very desirable area in which to live, as well as work.”
The Q2 data continues the trend seen in Q1, when 14 deals were completed along the M42, the best quarter for almost four years, accounting for 120,000 sq ft.
Birmingham Business Park has continued to dominate, accounting for 31,336 sq ft of space, and the two largest lettings, of 13,172 sq ft – to GKN at 2100 The Crescent, and 9,854 sq ft – to the British Heart Foundation at Compton House.
Jones says those transactions also demonstrate that the M42 corridor attracts a remarkably varied range of occupiers.
“You might expect the small office market in this area to appeal to companies which work in the automotive or aerospace sectors, but every year we see inquiries from a very wide array of potential occupiers, and it’s been no different so far in 2019,” he says.
“If you look at the other 11 transactions, they range from software developers to a lighting business, and from a tax consultancy to a maritime systems provider from Norway.”
However, Jones remains concerned about the dearth of larger office units along the corridor, which he recently suggested needed developers to bring forward HQ-style building of c80,000 sq ft on a speculative basis.
“The Q2 data perfectly illustrates the challenge, as all bar one of the 13 deals are for less than 10,000 sq ft. Looking forward, the lack of more substantial chunks of Grade A space is the only thing which could hold this market back.”