Retail rents rise as investment flows into Second City

RETAIL rents in Birmingham are now higher than Manchester, Leeds, Edinburgh, Bristol and Belfast, according to new research.

The increase is attributable to a flood of inward investment, regeneration projects and infrastructure work, suggests the Midsummer Retail Report 2017, published by property consultancy Colliers International.

The report said Birmingham had seen a four per cent increase in prime zone A retail rental growth, compared to 0.2 per cent regionally and 0.8 per cent nationally, excluding London.

This type of rent is now at £295 per sq ft in Birmingham, up from £285 per sq ft in 2016.

The city has benefited from a large increase in its retail offer in recent years on the back of Grand Central opening in 2015 and the Mailbox undergoing a £50 million revamp.

News of major companies such as HSBC creating hundreds of new jobs in Birmingham will further serve to push up prices.

Colliers said the picture across the Midlands was a little more varied with the Merry Hill centre witnessing a five per cent rise in rents year-on-year and Stratford-uponAvon seeing a four per cent increase.

Average prime rents have decreased in Shrewsbury, Halesowen, Redditch and Walsall, the research suggests.

Emel Ahmet, associate director in the Midlands retail agency team at the agency, said: “We expect that further infrastructure investment will encourage yet more regeneration initiatives which will add value for investors and traders alike over the next decade.

“However, this will mainly benefit areas which have witnessed the greatest decline since the financial crisis, rather than established shopping centres and prime locations.”

The Midsummer Retail Report looks at the trends and innovations which are shaping the country’s retail sector.

It said there was just under 500,000 sq ft of shopping centre development in the pipeline for the West Midlands over the coming years, with most of this currently under construction.