September 22, 2017
The government announces a major new office for public servants in the West Midlands
Thousands of public servants in the West Midlands will move to a new building in central Birmingham, as the government continues its drive to modernise its office estate. HMRC working with the Cabinet Office has signed a 25 year lease to take 238,988 sq ft at 3 Arena Central, which is a new office development in the centre of Birmingham. The building will see around 3,600 public servants from several government departments move there from 2020, including from HMRC and Department for Work and Pensions (DWP). The hub will be the base for one of HMRC’s regional centres. DWP plans to move staff into the hub from existing offices in the city. The move is part of the Government Hubs Programme, which will reduce the number of isolated and under-used offices that the government has by co-locating departments in shared buildings across the UK. Departments moving to hubs will need less space as they adopt smart working principles, which will reduce their operating costs. Providing modern, flexible office space will further deliver value for money by improving staff wellbeing and productivity
Strong demand and a lack of supply is helping to boast the regional office rental market, according to Savills’ latest Regional Offices Market Watch. The firm anticipates that take-up will reach 9.8 million sq ft (910,450 sq m) by the end of 2017, a 4 percent increase on 2016 and 9 percent up on the 10 year average. This is due to a number of large Government Property Unit (GPU) deals completing in the second half of the year. As a result of strong demand, total availability across the UK fell by 1 percent to 30 million sq ft (2.787 million sq m) in the first half of the year, which equates to just 1.8 years worth of available Grade A supply. What’s more, Savills notes that office based employment across the regional cities is forecast to grow by up to 4.6 percent over the next five years, leading to a net additional 55,000 jobs, representing a need for a further 5 million sq ft (464,616 sq m) of office space.
A new scheme to help the NHS cut the costs of empty space in their buildings has been launched this week by NHS Property Services (NHSPS). Properties that qualify for the scheme must be deemed surplus to NHS requirements and may be re-let, disposed of or considered as a development opportunity. The new Vacant Space Handback Scheme comes in response to feedback from commissioners who want to reduce the cost of maintaining space that is no longer needed for clinical services. The cost of maintaining vacant space is kept as low as possible, though some costs are unavoidable where rent, business rates and some service charges remain payable. The total amount and cost of maintaining vacant space in the NHS is difficult to calculate, but costs are estimated to be in excess of £10 million a year on the NHS Property Services estate.
