Birmingham property expert James Cubitt outlined the upsurge in trading and confidence in physical stores at the launch of the Greater Birmingham Chambers of Commerce’s Quarterly Business Report (QBR).
And he cited the Bulling and the recent £290 million sale of the Merry Hill Shopping Centre as prime examples of new optimism surrounding the shopping centre sector following years of struggle in the face of Internet sales.
Other speakers at the event included Emily Stubbs, head of policy at Greater Birmingham Chambers of Commerce and David Bond from Birmingham City University. It was hosted by Raj Kandola, deputy CEO of Greater Birmingham Chambers of Commerce.
Emily gave an overview of the latest QBR findings which revealed firms began the year positively with an uptick in advance bookings domestically and abroad, recruitment activity picking up and positive signs around training and investment.
However, the conflict in the Middle East has thrown plans into disarray due to rapidly rising fuel and utility costs, as well as freight delays and significant increases in transport and carriage costs.
At the time of surveying for the Q1 report, less than 9 per cent of businesses reported pressure to put up prices as a result of rising fuel costs – but this is expected to increase sharply in Q2 due to the impact of the war.
James, head of the Birmingham office at Colliers, told guests at the Curzon Building at Birmingham City University: “Retail property has suffered tough conditions over the past 10 to 20 years due to fundamental changes in the way people shop – that is retail moving out of physical stores to online.
“There has been a bit of a sector rebound since 2023 and the market penetration of e-commerce and the number of online sales as a percentage of overall retail sales, that rate of penetration is slowing.
“Anecdotally, speaking to our retail clients, a lot of them are re-focusing their efforts on physical stores rather than purely looking at their online retail growth.
“A local success story in retail would be the Bullring. Following the demise of Debenhams and the Arcadia Group, that western end of the Bullring centre was quite a bleak place, quite under-utilised at that point in time.
“Fast forward five years and the centre has a vacancy rate of less than five per cent, which is really good for a centre of its size. Rents have been growing at round about two per cent per annum and it is reported that the occupiers have invested about £75 million in their stores.”
He said the tenant mix was “unrecognisable” from a few years ago with ‘experiential’ leisure focusing on social media, “hype and buzz” amongst new retail innovations in the Bullring.
“These improved market conditions have transferred into a surge in investment activity, particularly in the shopping centre market. The trading volumes in Q1 2026 were £418 million, hugely up on the same period last year. It is the strongest sector performance for well over a decade.
“Interestingly, 70 per cent of those volumes are attributable to one transaction here on our doorstep and that was the acquisition of the Merry Hill centre in March for £290 million, bought by Redical, who I know have got very grand plans for the centre. This is a real vote of confidence, both in retail and in the West Midlands.
“In retail, following a long, arduous decline, things are moving in the right direction with shopping centres and retail parks performing extremely well.”
James said the office market was also undergoing a dramatic role change. “The office used to be a place of necessity. You went there for a desk and a computer – that is not needed any more. The office is now a place of experience so it needs to be vibrant, a place where you can collaborate – the problem is it costs a huge amount of money.
“Often, there is a lack – or it might never come – in terms of getting the return on investment in terms of increased rents and increased capital values.”
He said world events such as the Iran war and interest rate rises were key to the future of the property market. “Everything is taking a lot longer and people are more cautious in terms of investing or entering into capital investment projects, be that fitting out a building for their own occupation or fitting out a building that they are going to look to let.”
James said the property investment sector had entered 2026 with optimism. “The tag line that was used was that property investors were hoping to get rich in 2026. World events have had a significant cooling effect on both activity and sentiment.
“Anecdotally, from speaking to people, most are saying that they see this as a delay rather than a derailment to improved market conditions. Get rich in 2026 may become heaven in 2027.”
