Birmingham office market take-up remains strong with a growing demand for out-of-town space - report

Birmingham’s office market has seen an uptick of 13 per cent on the previous quarter in Q1 of 2025 - with out of town office space being most in demand.

That’s according to real estate advisor Avison Young’s latest Big Nine report.

An encouraging out of town performance provided a significant boost to figures reaching 119,325 sq ft, the strongest since Q3 2021.

In comparison, the city centre market experienced its lowest level of take-up since Q1 2021, reaching 75,522 sq ft.

However, the report states this is as a result of a number of large lettings taking longer to conclude.

The major deal that contributed this quarter was the Boparan Restaurant Group’s 62,000 sq ft acquisition of Portland House, Solihull, which drove demand levels in Birmingham, accounting for 32% of take-up in Q1 2025.

As for the city centre, Phoenix Life acquired 25,000 sq ft at 10 Brindleyplace, and Gilbanks secured 21,000 sq ft at 5 St Phillips - both accounting for 24 per cent of take-up.

The vacancy rate in the city increased by 1.7 per cent last year, with second hand space being a key contributor.

It is anticipated that office conversions to alternative uses will see an upward trend with landlords dealing with ageing stock, viability issues and evolving occupier requirements.

Mark Robinson (pictured), principal and head of office agency at Avison Young, said: “The Birmingham office market continues to remain as resilient as ever during a turbulent time for the city, and it is reassuring to see the negative headlines not detract from the prime real estate opportunities the region has to offer.

“As we sit firmly in the second quarter, there are signs of optimism that we will see continued positive trends as we progress further into the year.”

National occupier demand for offices also continues to display resilience with Big Nine take-up reaching 2.1m sq ft in Q1 2025, in line with the 10-year quarterly average and the strongest Q1 since 2018.

The out-of-town market also saw increased momentum on a national level, with take-up reaching 809,825 sq ft, its highest level since Q3 2021.