Birmingham office market Q3 roundup
Take-up
Birmingham Q3 2024 take-up totalled 349,000 sq ft across 23 deals. This was 165% higher than the same period in 2023, and also 103% higher than the five-year Q3 average. Total year-to-date (YTD) take-up amounts to 721,000 sq ft, which has already surpassed the total for the entirety of 2023 by 3%, putting Birmingham on course for a record year.
Grade A and Prime take-up in Q3 totalled 60,000 sq ft, which accounted for 17% of the total. YTD Grade A and Prime totals 335,000 sq ft, therefore accounting for 47% of the total take-up.
Supply
Total availability at the end of Q3 2024 stands at 1.8 million sq ft, which represents a decrease of 1% on the previous quarter. The overall vacancy rate is now 10%, which is a 10 bps decrease on Q2 2024.
Grade A and Prime availability at the end of Q3 2024 totals 1.2 million sq ft, an increase of 9% on Q2 2024. This comprises 761,000 sq ft of Grade A and 505,000 sq ft of Prime space. The Grade A and Prime vacancy rates now stand at 4.1% and 2.7%, respectively.
Take-up by business sector
The most notable sector in Q3 2024 was the 'Public Services, Education & Health' sector, which leased a combined total of 272,000 sq ft across seven deals. The sector accounted for 78% of the total in Q3, with the largest deal of 189,000 sq ft being acquired by Aston University at 10 Woodcock Street. Another large deal in the sector was at 1 Brindley Place, which was acquired by Global Banking School for a total of 68,000 sq ft.
Another active sector in the quarter was the 'Professional' sector, which accounted for 11% by totalling 36,000 sq ft. This was across six deals, the largest of which was acquired by Trowers & Hamlins for a total of 16,000 sq ft at One Snowhill.
Rents
The Prime headline rent has seen no increase in 2024 and currently stands at £42.50 per sq ft, with Birmingham experiencing 23% prime rental growth since the end of 2019. Looking forward, against a backdrop of in-demand Prime supply, a thin development pipeline and a rise in requirements in the market, forecasts expect the Prime rent to grow by a further 22% over the next five years to approximately £52.00 per sq ft by the end of 2028.
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Further reading