News Item
MAKING A MARK ON THE OFFICE LANDSCAPE FOR
THE GOOD OF THE TENANTS AND THE CITY
23 Aug 2005
With more than 1 million sq ft of new grade A office space due to get underway in Birmingham within the next 12 months, leading commercial developer Alan Knight argues that the developers have a once in a lifetime opportunity to put Birmingham on the map and attract new organisations to the city by constructing landmark buildings.
“With planning permission finally granted for 720,000 sq ft at Snow Hill and demolition work underway at the 300,000 sq ft Post & Mail site, it appears in the next two years, that Birmingham’s years long shortage of grade A office space may finally be over, and the much longed for accommodation to attract large organisation relocations to the city will be here,” says Alan Knight, development director at Birmingham-based CALA Properties.
“Shortage of grade A office space over the past four years has made sure that Birmingham has not even been in the running for any major relocations, with Manchester benefiting from the likes of the Bank of New York moving from London,” continues Mr Knight, who is a board member of Locate in Birmingham.
“Take up in the Birmingham office market has been dominated by local professional services firms growing into new, larger office accommodation and the Royal Bank of Scotland’s decision to consolidate at Brindley Place, as well as some national government moves.
“The success of the local financial and professional services market in Birmingham has been a massive boon for the local economy and created tens of thousands of new jobs, but there has been no major recent inward investment into Birmingham, and with the departure of Lloyds TSB to London in the 1990’s, the city lost its last major corporate headquarters.
“However with the new speculative office space coming on stream in 2007- 08, Birmingham finally has a chance to claim a major inward investment and influx of new jobs.
“But what will make footloose organisations choose buildings in Birmingham, rather than, say, Manchester, Leeds, Glasgow or Edinburgh, where rents for Grade A office accommodation are less than the £27psf, which is now the benchmark in central Birmingham.”
According to Mr Knight, the key to success for each building and, more importantly the city as a whole is outstanding design.
“Apart from Brindley Place which set the standard for design in the city, most office blocks which have gone up in the past five years have been bland,” contends Mr Knight.
“And in a market where every speculative building has been snapped up by a tenant at a greater rent than was originally envisaged, this is no surprise.
“Developers have not had to spend additional money on design, rather they have focused on providing the large unbroken floorplates favoured by tenants and maximising available space to optimise returns, favoured by the eventual purchasers of the building the institutions. As a result they have all been very successful.
“However, what the city as a whole has lacked in that time has been a statement building which could have played a role in helping to put it not just itself on the map, but also Birmingham as a first class office destination.
“The developers of Snow Hill, Post & Mail, Masshouse and, in time, Arena Central, and Eastside have this opportunity, and it is something,” argues Mr Knight,” that can boost the profile of not just the building, but also of its occupiers.”
For years Birmingham’s main landmark office block in the central core has been the Wesleyan and the old, tired and now empty, NatWest Tower, providing additional recognition for the named occupiers.
Mr Knight says: “Corporates in the United States and more recently in Hong Kong and Shanghai, have used landmark buildings named after themselves to boost awareness, but the building still has to provide the best accommodation for its occupiers.
“In the City of London insurance company Swiss Re, has been much less effective with this strategy at its landmark tower at 30 St Mary Axe. Although known as the Swiss Re, the name “erotic gherkin” has also stuck to the Norman Foster designed building.
“The 250,000 sq ft surplus space has also proved difficult to let because of awkwardly shaped floorplates and a reluctance by rival insurers who make up the bulk of the market in EC3 to move into a building too closely associated with Swiss Re.
“So, the key for the developers of Birmingham’s new grade A office stock is to combine large, regularly shaped floorplates with outstanding design.”
Mr Knight believes that they can learn from CALA Properties’ Central Exchange building in Glasgow, which has just been voted Scottish Development of the Year and helped bring CALA the title of Scottish Developer of the Year.
A 96,000 sq ft office building in the heart of Glasgow’s Central Business District, Central Exchange was forward funded by German fund Internationales Immobilien-Institut GmbH (iii-Fonds). Completed last year, it is nearly fully let, to organisations such as actuarial firm Hymans Robertson and to the Clydesdale Bank.
“We had a prime site in the city, but we were determined to ensure that the building provided not just the large regular floorplates, of over 13,000 sq ft, which tenants want, but that the building as whole stood out in its location, becoming a landmark in the city,” says CALA Properties’ managing director Alasdair MacConnell.
“We made a conscious decision to make a statement with the building, starting with the dramatic drum corner feature, combined with a clean-lined contemporary look.
“We have achieved recognition for Central Exchange, not just in terms of awards, but in terms of successful lettings in a market where there is plenty of tenant choice. The building, and its location, are now universally recognised in Glasgow and Clydesdale Bank is so delighted that it has asked to change its name to Clydesdale Exchange, a request which we have gladly agreed to.”
CALA Properties owns, on its own account or in joint venture, more than 550,000 sq ft of commercial space for development in the West Midlands and Scotland, which it is looking to develop in the next 12 months
It expects to be able to announce some new schemes shortly in the centre of Birmingham.
| PR CONTACTS FOR CALA PROPERTIES | |
CALA Group Limited tel: 0131 535 5200 |
Reay Public Relations Ltd. tel/fax: 01369 840042 |
Back