Regional Review – Birmingham

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Our latest regional review brings us to the middle of the country and the (still) underestimated and undervalued city of Birmingham (at least by those who don’t know it).

We’re relatively regular visitors to the city and we’re also big fans. Here, with the help of an expert panel of industry pros, we’re hoping to dispel a few myths and do our own bit of PR for ‘the second city’.

We’ve come, fittingly, to the amazing Custard Factory and the new Birmingham home of Gensler where we’re joined by Gensler’s own Alistair Cory, Enrico Caruso and Gurtake Singh, Associated Architects’ Steve Townsend, Overbury’s Joe Huddleston and, from our sponsors Connection, Oliver Bond and Debbie Smallman.

We say fittingly because Digbeth’s Custard Factory is a perfect example of ‘new’ Birmingham. This genuinely feels like the heart of the city’s creative and digital revolution – think Shoreditch’s Tea Building on tour.

Just a few minutes’ walk from the Bullring, the Custard Factory is home to over 500 businesses and hosts to fairs, festivals and gigs, along with corporate events and weddings.reginal-review

We begin by asking our panel to tell us about how they feel about today’s Birmingham, starting with two designers born and bred in the city.

Steve
Birmingham is our (Associated Architects) only office. We’ve considered opening offices in other cities, but our business plan is to stay the size we are and to keep a regional focus. Approximately 60-70% of our project work is within two hours of Birmingham. I’ve got a real passion for the history and industrial heritage of the city. I ran a project called Hidden Spaces, where we sussed out all those little pockets of the city that the public didn’t know about.

Joe
I’m very passionate about Birmingham and where it’s heading. I think Birmingham’s really coming up – there’s a lot happening right now and I’m thrilled to be creating a small part of it; building lasting relationships in Birmingham and the surrounding Midlands.

There’s very much a feeling of pride and optimism from our boys from Birmingham, but how do the ‘visitors’ around the table view the city?

Oliver
At Connection we are really focused on a regional approach, whether it be Birmingham, Manchester, Edinburgh etc. Birmingham is a market we’re taking really seriously right now, we believe it represents a real opportunity for us, so much so that we are looking to strengthen our resources here.

Alistair
I joined Gensler just over a year ago with the specific intention of leading Gensler’s strategy into the UK regions – into the key cities. 
There are incredible opportunities in regions such as Birmingham and the Midlands in general. We could have overshot and gone to Manchester, of course, but we chose Birmingham because we see so much potential here. Just look at the investment in HS2 and Curzon Street – and all the things that Birmingham City Council and the city are trying to do right now; the notion that the city and the Midlands is a real powerhouse and deserves to be as recognised, if not more recognised than the North – Manchester and Leeds. All the embedded reasons that make this region fantastic, all the firsts that have come out of here – the police whistle, the jewellery, the industrial revolution…and I think Birmingham is really capturing the new digital revolution right now and the creative culture of this place is critical and is why we (Gensler) came here rather than heading into the CBD – where people might expect us to be. We want to be able to look out of the window and see the most exciting part of the city – the HS2 development etc.

Gurtake
I’m also Birmingham born and bred, but moved away to London. I was originally reluctant to come back to Birmingham because London offers so much to a young, enthusiastic interior design graduate who wants to change the world. When I did come back it was a little bit slow to start off with, however, today it is phenomenal. The transformation you can see just by walking around the city – the number of cranes, the amount of work going on…there’s so much to offer now, especially here on the creative side of town. It’s exciting times.

‘…I think Birmingham is really capturing the new digital revolution right now and the creative culture of this place is critical…’

Joe
I agree. Birmingham has just got better and better and better. I believe it now has more Michelin stars than any other city outside London. Design is definitely on the up and there seems to be more people in the city centre. I think the Bullring kicked that off. People now get dressed up to go shopping – it’s become a day out, an experience. People are realizing that it’s not a ‘concrete jungle’ – it has so much to offer. Also, it is in the centre of the country, with good links to other cities and fantastic educational facilities.

Steve
Walking around this part of the city you find a real open door culture. You know everyone in the building and there are so many opportunities for collaboration.

Enrico
Certainly one of the big reasons why I’m excited about being involved with working alongside Alistair and the team here is because it is a shared community. We can all benefit from these shared resources. I’m excited to see Steve and Joe here. In London we often struggle to get to together with other designers around a table and talk like this. Can you imagine certain firms in London doing this? I think there’s room for all of us – and we can share and learn from one another.

Oliver
It’s clear that Birmingham is doing a great job of attracting interest and excitement from outside of the other big cities, it seems to be gaining momentum really quickly.

‘In London we often struggle to get to together with other designers around a table and talk like this’

Alistair
It’s interesting to compare Birmingham and Manchester. How have they responded to the critical issues that make a successful city? One of these is having that cohesive vision. Manchester’s had that. I think the catalyst, sadly, was the IRA bomb. There was a cultural coming together. Maybe it was so damaged that they had to do something. There was a real healing process. For Birmingham there is perhaps no equivalent thing, but HS2 has the potential to divide as well as unite. There is a really mixed opinion to it and to the investment. It’s about building confidence. It’s a different type of catalyst, but one we can all get behind. The other thing is the global perspective in and out of the city – marketing Birmingham properly and acknowledgement of investment. There are now grand plans in place which will work – and there’s a steady stream of investment coming through on a grand scale.

Steve
These investments and plans are also transforming what were big, empty spaces and dilapidated areas of the city. We’re now starting to see the core of the city expanding outwards. The council’s strategy and the fact that they’ve got a masterplan is very positive. The Big City Plan is the best thing they could have done – to show the outside world that Birmingham has a plan and deliverable targets. I think this is quite aspirational and shows the ambition the council has.

Alistair
Birmingham still has a lot of hurdles to get over – it has so much potential, but funding investment is always an issue. I think it needs to embrace the private sector – whether it is designers such as ourselves or investors, we’re really keen to come in and partner with the city, to put our creativity and our investment behind it. I think this has happened with the university. Areas such as Digbeth are focused on developing investment and retail – but there is also a determination not to do this wrong, not to do this too fast. This should be allowed to grow from within with the right time of investment and the right people. 

The fast track

Birmingham has not always had good press, often described as ‘punching below its weight’. The much loved/hated Jeremy Clarkson suggested of Birmingham, ‘There are signs directing you away from Birmingham but nothing enticing you in’. Whatever your standpoint on Birmingham’s relative popularity, from a commercial office point of view, without doubt the light at the end of the tunnel is not an oncoming truck.

Gensler’s move to Birmingham’s Custard Factory in Digbeth may be relatively small (3,000 sq ft) in the scheme of things but none the less significant as a clear sign of confidence from the global design firm (see page 75 for their rationale). While we have seen a number of professional firms move their back office out of London (Freshfields to Manchester, Herbert Smith and Allen & Overy to Belfast) it is less common for front-office function to be moved, until now.

A fission ofexcitement would have been palpable in the corridors of Marketing Birmingham as HSBC announced its intention to relocate its new headquarters and Deutsche Bank its trading operations.

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What has changed? The proximity of London, once regarded as a problem by many corporate financiers who bemoaned ‘deals’ going to London, has a current journey time of 1hr 23mins and regarded as entirely positive by most. Many, however, regard the key change in fortunes for Birmingham to be the stifling cost of living that many London employees see as so significant – needless to say Business Birmingham will not have been slow to point out the benefits of moving two degrees westand 125 miles north – and that by 2027
the journey time will be an hour.

As we take a closer look at the regions, the third in our series, Birmingham is our next stop. At Mix Interiors we believe the whole of the property food chain is of interest to our readers, therefore we will use this anniversary issue to reflect on the UK property market over the last 12 months. All round, 2015 was a good year for commercial property with strong returns for investors and increased rental growth and demand.

However, many expect the property market in 2016 to be more a challenging environment. With the likelihood of rising interest rates; potential adverse media coverage surrounding Brexit; challenging export conditions and a host of international risk factors. According to the Construction Products Association, the office market is projected to in 2019 to be valued at £9.8 billion, which is still 17.9% below the peak of 2007. That being said, most commentators suggest that key UK centres will continue to deliver good returns for those involved in commercial property.

As we go to press we will be hosting a Mix Inspired (seminar), looking at the Capital’s current commercial property position and more crucially what our panel’s collective response is to the future of London as it aims to continue to thrive under a multitude of pressures.

London continues to lead the way in terms of commercial real estate investment (worldwide), but many investors are looking for better yields in some of the UK’s regional markets. Regional centres such as Glasgow, Manchester and Birmingham have all benefited recently as a result of adverse conditions in London, however all suffer from lack of prime developments. Whilst significant develop has taken place in the last 12 months, it is still behind the required level. It is in Birmingham where it is perhaps the most acute and where we turn out attention to this month.

According to Knight Frank there was less than six months’ supply of office space at the end of 2014, which was probably the reason the reaction was over £1m sq ft of new space approvals. As our in-depth report shows, key protagonists in Birmingham are considerably more upbeat, not least of all with the redevelopment of Snow Hill and Paradise Circus – let’s not underestimate the inherent value of Birmingham New Street after years in the doldrums.

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CBRE reported that office transactions in central Birmingham had almost doubled in the first nine months of 2015 compared to the same period in 2014 (732,044 sq to 372,296 sq ft) with Will Ventham, Director at CBRE’s office agency team saying, ‘We haven’t seen take-up figures as strong as this since 2008, before the recession. The bulk of the deal activity took place during the second quarter of the year, with the commitment of HSBC’s retail banking headquarters to its new 212,000 sq ft offices at 2 Arena Central the stand-out transaction of the year’.

Further good news for the West Midlands was announced by the Chancellor last year (November 2015) as Greater Birmingham agreed to form a combined authority that brings together seven councils across the sub region. The £1.2bn handover is seen by many as the most valuable to date and silenced many who felt the region was being left behind by Manchester, Sheffield and Leeds.

Andy Street, Chairman of the Greater Birmingham & Solihull Local Enterprise Partnership, said: ‘The announcement is hugely welcome. It has many impressive features, among which confirmation that the city centre enterprise zone will be extended around the Curzon Street HS2 terminal is important. The proposed deal will also support the delivery of the wider HS2 Growth Strategy; critical to realising all the benefits of this once in a generation investment.’