HSBC is to establish a 210,000 sq ft base in Birmingham.
The banking giant will open a new headquarters for its ring-fenced banking business, which serves personal and business customers, at Arena Central Development’s 1.5m sq ft Arena Central mixed-use scheme in the city.
In a major coup for Birmingham, HSBC will relocate 1,000 staff into the speculative first office phase of Arena Central – the 212,821 sq ft 2 Arena Central building, which will front Broad Street from mid -2017. Work will start on site in June 2015.
The bank’s UK headquarters is at 8 Canada Square in Canary Wharf, E14, where it has just over 12 years left on its lease of the entire 1m sq ft building.
The deal marks the biggest Birmingham city centre office letting since Deutsche Bank relocated several functions out of London and signed for a total of 250,000 sq ft at Five Brindleyplace in 2008. It also follows another relocation from London last year, by HS2 Ltd to M&G Real Estate’s Two Snowhill.
HSBC was originally in talks to take up to 500,000 sq ft for a prelet at Arena Central to consolidate its West Midlands’ operation in July 2007. However, the deal collapsed in 2008 owing to the economic downturn.
The creation of a ring-fenced bank is in response to the Financial Services (Banking Reform) Act 2013 and must be completed before 1 January 2019. HSBC’s decision to create the head office of its UK ring-fenced bank in Birmingham follows a review of a number of possible head office locations.
HSBC UK chief executive Antonio Simoes said: “We have been looking at options for the head office of our ring-fenced bank for some time. It became clear to us that Birmingham would be the right location. The city is close to London, but also brings us within easy reach of our 16m customers across the UK. Birmingham is a vibrant, growing city that has the expertise and infrastructure to support our ring-fenced bank .”
Negotiations have been supported by Birmingham city council and inward investment agency Marketing Birmingham.
Sir Albert Bore, leader of Birmingham council, added: “HSBC joins a number of global companies that want to be a part of Birmingham’s accelerating growth and strong economic prospects.”
HSBC is in advanced talks to conclude the acquisition of the 250-year lease on the new office at Arena Central, which sits within the city’s enterprise zone. Legal documents are expected to be signed in the next few days and a reserved matters application for the new building has been submitted.
Miller Developments chief executive Phil Miller said: “ HSBC’s commitment to Birmingham is great news for the city and their choice of 2 Arena Central is a tremendous boost for the development. This will enable us to push ahead with realising the full scale of the scheme and deliver HSBC’s requirements and our vision for this key site in the heart of the enterprise zone.”
Arena Central sits on a 9.2-acre city centre site and has outline consent for a further 860,000 sq ft of offices, more than 200,000 sq ft of residential, and 1.2m sq ft of shops and leisure space.
GVA and CBRE are letting agents for Arena Central.
