Investment in Birmingham property is increasing

Birmingham has become a very attractive city for homebuyers and investors. 2015 was a year of huge investments in both private and commercial property. It was especially a record year for the latter with almost double the five-year average in commercial property investment, a total amount of £845 million in transactions.

Investments in offices are the most popular. A 76% of all commercial investments last year was in offices, reaching a figure of £641 million from 25 different deals. This was a 2% higher than 2014’s total amount of £626 million, says CoStar Group.

However, there was a decrease of a 5% in investments in real estate, with a total amount of £67.5 billion, still it has been a very strong year, with a 46% above the average of the last ten years. In there was a record of £70.7 billion.

Some of the most significant acquisitions in Birmingham city centre in 2015 were Colmore Plaza for £138.3 million by the firm Ashby Capital and 1 Colmore Square, purchased for £87.3 million by Legal & General.

In the last few years, banks have been more interested in Birmingham. Two big players, as Deutsche Bank and HSBC have been the first ones to move some of their operations from London to Birmingham. Deutsche Bank moved office functions and HSBC intends to do the same with its retail operations.

Property analysts at CoStar claim that Birmingham has become an attraction for both national and international investors because of the regeneration of its infrastructures and due to the fact that it is Britain’s second largest city and one the most powerful economic engines in the country.

Birmingham has drawn more and more attention thanks to projects such as the refurbishment of New Street station, the tram line extension and the plan to build the HSC railway link to London soon. Also, the expense of capital has made investors look for other cities.

Not only Birmingham has had a rise in the investment in commercial property, the whole region of West Midlands increased a 6% the amount of money invested in 2015, a total figure of £2.66 billion.

The consultancy Lambert Smith Hampton, that produces the UK Investment Transactions report, said that in the West Midlands the office sector reached an investment of £822 million, a 31%, whereas the retail sector only got almost 28% with £744 million of transactions.

Below these two sectors are the industrial transactions with a 17%, a figure of £453 million. The transactions in other sectors were worth £645.

There is no doubt that 2015 was a record year with a 54% more in investments than the five-year average and 49 per cent above the region's ten-year average. We would like to highlight the sale of the NEC for £307 million to LDC as one of the most important transactions in the region.