HS2 Payback: Industrial Landlords Attempt 40% Rent Increases
Increased demand for industrial and manufacturing space and the loss of many acres of industrial land due to HS2 have combined to push up Birmingham industrial rents by between 20% and 25% over the past five years.
That is according to property agency KWB, who said the effects are particularly marked in North Birmingham where the high-speed rail HS2 project is consuming land most rapidly.
Some landlords are attempting to exploit the supply crisis by pushing for increases of up to 40% at rent reviews, KWB Head of Valuation Martin Cook said.
“This seems to be more prevalent in North Birmingham where the demands of HS2 have seen swathes of industrial land compulsorily purchased and a number of occupiers having to seek new premises," Cook said. “I have been negotiating new rental terms for industrial and manufacturing units on behalf of a number of tenants in the Aston and Perry Barr areas, where one landlord started off by asking for an increase of some 42%."
Cook negotiated the increase down to 22%.
Average rents in Birmingham are now hovering around £7/SF, with Solihull higher at £8.50/SF.
