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Birmingham Post
Birmingham Post
Business
Tamlyn Jones

Residential activity dominates construction in Birmingham - report

Residential projects accounted for almost all of the new starts on construction schemes in Birmingham last year, according to new research.

Of the 18 developments which broke ground during 2021 in the city, 14 of them were residential which is a significant hike on the four registered in 2020.

Completing the activity for 2021 were two office schemes - Enterprise Wharf in the Gun Quarter and the remodelling of 10 Brindleyplace - the Compass student housing in Eastside and the conversion of the former Thistle Hotel in the city's Gun Quarter into a 174-bed aparthotel.

There were no new developments within the education or leisure sectors and, for the third year running, no standalone retail projects were started, according to the 2022 Regional Crane Survey published by financial services firm Deloitte.

The report, now in its 20th year, examines the level of construction activity in Birmingham across a range of sectors including offices, residential, hotels, retail, education and student accommodation.

Its findings said the number of new projects almost doubled in Birmingham - from ten in 2020 to 18 in 2021 - while there are now 24 residential sites currently under construction.

However, the number of residential units actually delivered in 2021 was 1,520, a 26 per cent drop from the 2,072 units completed in 2020.

More than 750,000 sq ft of office space was completed during 2021 and the biggest lease deal agreed was the 68,479 sq ft at One Centenary Square to built environment consultancy Arup.

However, offices under construction dropped by half to just over 600,000 sq ft.

The total number of property projects currently under construction in Birmingham remains on a par with 2020 at 34.

The other cities covered by the 2022 survey are Belfast, Leeds and Manchester which registered seven, 22 and 25 new project starts during 2021 respectively.

Edwin Bray is a partner in the real assets advisory team at Deloitte in Birmingham and the author of this year's crane survey.

He said: "Following a subdued 2020 where activity remained resilient in very challenging conditions, construction levels across the city have picked up pace as we see a return in developer confidence. Development levels vary across the city with activity concentrated in two sectors.

"It has been an exceptional year for both residential and office developments within the city centre, accounting for 16 of the 18 new schemes.

"However, in many ways, the story is as much about developments in Birmingham which are not covered by the Crane Survey as those that are - we've observed more schemes just beyond our Crane Survey search area and across the wider conurbation.

"Major developments linked to the Commonwealth Games sit outside of the survey's boundaries which is where we are seeing higher levels of activity across all sectors.

"Once the Games has taken place, we should see additional activity with some projects set to be repurposed, bringing new leisure, hotel and mixed-use schemes."

Referring to the hike in residential activity specifically, Mr Bray said there had been a noticeable increase in the volume of work in the Jewellery Quarter, Southside and Westside districts.

He added: "The ongoing pandemic coupled with supply issues, restricted availability of materials and labour shortages have all contributed to delays in the completion of some residential schemes. However, the sector could return to record-breaking levels in 2022 as delayed projects complete.

"Development opportunities in the city centre continue to attract strong interest from both UK and international investors, with planning application levels remaining high for both small and large-scale developments."

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