Birmingham sees record construction activity

Birmingham saw 1.4m sq ft of new office space under construction in 2016, a 50% increase on the previous year.

BIRMINGHAM DEVELOPMENT SNAPSHOT

The Deloitte crane survey recorded the highest level of construction activity since the report was first published in 2002.

Birmingham also witnessed a tenfold increase in residential schemes starting construction in 2016, totalling 2,331 units in the city centre. As HS2 moves closer to its planned 2026 completion date, Birmingham is becoming a national hub for rail engineering and associated consultancy, the report found.

The student housing sector continues to expand with demand for modern, high-quality accommodation encouraging investors to commit to the city. There are currently three major developments under construction that between them will add some 1,166 new student beds to Birmingham’s total.

Financial services sector growth is expected to continue, with significant deals in the past two years including Deutsche Bank’s expansion at Brindleyplace and HSBC’s deal to take 250,000 sq ft at Arena Central.

Office-take up for the city was around 693,000 sq ft in 2016, close to the long-term average. The report found there was a slowdown around the EU Referendum with a “return to normal” during the final quarter.

“Current vacancy rates in the city are estimated to be at around 20%, and most predictions for 2017 are very positive with some forecasting a landmark year ahead,” the report found.

The growth in residential developments was put down to greater demand for city centre living with the private rented sector dominating. This follows Birmingham City Council’s Big City Plan, announced in 2010, which set out an ambition to ensure the building of more than 5,000 new homes in the next 10 years.