Office take-up falls within public sector
Office take-up from the public sector declined 13 per cent in Birmingham in 2010. According to research from property agent CBRE, expired leases result in "opportunities to consolidate into more efficient buildings" resulting in the downturn.
Total office take-up from the public sector was 92,884 sq ft in 2010.
Ashley Hancox, the Birmingham-based head of regional offices at CBRE, said: "Leases will expire and the opportunities to consolidate into more efficient buildings will arise.
"The drive for greater efficiency will result in a continued flight to quality and a desire to occupy more modern accommodation and in some instances the public sector may continue to provide very modest demand for Grade A stock.
"Furthermore, regional city locations will remain attractive on cost grounds, particularly as the gap widens between rents in central London and the regions."
Currently, more than 1.2 million sq ft is currently occupied by central government departments in Birmingham, with a total civil service workforce of 9,330.
Hancox said the release of secondhand space back onto the market may become an issue for Birmingham and other big cities.
He said: "Releasing this stock back onto the market during a time when vacancy levels of lower quality stock are already at very high levels. In good locations this may provide development opportunities for new Grade A offices, although the ability to transform their buildings will be dependant on innovative refurbishment programmes to meet increasingly demanding sustainability targets from all sectors."
