28 February 2017
The government’s high-speed rail (HS2) project may now be going full steam ahead after receiving Royal Assent, but a local property expert says one which needs to be urgently resolved is that of industrial land supply in Birmingham.
Mike Price (pictured), partner at chartered surveyors Johnson Fellows, says that construction of the high-speed train’s railway will force many businesses to relocate from their existing premises along the route.
Mr Price said he expected to see a number of businesses forced to look outside the Birmingham area and further afield into the West Midlands, such was the lack of industrial space available in the city.
The most affected areas will be Castle Bromwich, Saltley and Washwood Heath, where the route will pass through established industrial estates.
Mr Price said construction on the London to Birmingham HS2 route was due to get underway in Spring, so the industrial land supply issue had now become pressing.
He said: “A lot of current occupiers haven’t yet moved from their existing locations, simply because they haven’t been forced to. There were obstacles for the HS2 bill to overcome, so they could await the outcome, but now the last of them has been cleared the reality of having to relocate will hit home for many businesses.
“While HS2 is a natural progression for a new dawn of transport, the reality for some businesses is that they will have to move and this could have a negative ripple effect on the city of Birmingham.
“Because of the lack of industrial land supply in the city and surrounding areas, the options for new developments are very limited. So the huge question that remains for those finding themselves in this position is: where do they go next?
“This lack of space may mean businesses have to leave the Birmingham area. With the lack of space comes an inevitable rise in rents in the areas that are available. We are seeing rents pushing £7 per sq ft for new accommodation, and this may price out firms.
“The lack of land supply has seen operators sitting on their hands. Without the land supply we have not seen companies relocate into new facilities. This has had a knock-on effect of not releasing second-hand accommodation to the market.
“As such, opportunities are not only limited in terms of new build sites but also vacant existing accommodation. This will lead directly to those in this situation looking to relocate to other areas in the Black Country, and further into the West Midlands region, such as Redditch. This would be quite a blow for Birmingham.
“The West Midlands Combined Authority has a huge investment package pledged over the next 20 years as part of the devolution deal with Central Government. This funding should be utilised for site assembly, remediation and infrastructure projects to release under-utilised land assets and focused on employment land opportunities.”