Increase of office space in Birmingham
An increase in merger and acquisition activity and plans to minimise costs have been blamed for the huge decrease in office space take-up in Birmingham.
According to real estate adviser DTZ, take-up in the city fell to 111,000 sq ft for the second quarter, including a near halving of grade A transactions.
The report also said future leasing activity in the city is likely to be “subdued”.
Nick Allan, investment director at DTZ’s Birmingham office, said: “The rally of the past year or so has certainly softened in recent months, largely driven by the change in government, the austerity budget and now the holiday period.
“That said, we see the second half of the year being stable, with potentially some pressure from the institutions to spend cash allocations prior to year end.”
Availability is expected to peak this year as it is anticipated that private sector organisations will release more office space in coming months and prime rents are now expected to remain flat at £27.50 per sq ft over 2010-2011.
