The owner of the Mailbox in Birmingham says the forthcoming departure of anchor tenant BBC Midlands will be a "great opportunity" for the building.
The BBC announced this week that it was moving from the Mailbox - its home for 20 years- to a purpose-built base at the former Typhoo Factory site in Digbeth.
Mailbox REIT Plc issued a trading update on Thursday, declaring an interim dividend for 2022. It said the property's valuation had improved for the fifth consecutive quarter since the firm's IPO, rising to £192.3m as at 30 June 2022.
In his update, Mailbox REIT non-executive chairman Stephen Barter addressed the BBC's announcement from the day before, saying he was confident the space would prove popular.
READ MORE: BBC Midlands moving to new Birmingham hub in Digbeth
He said: Yesterday, the BBC announced that it is to leave the Mailbox at the end of its current lease in June 2026.
"Whilst the building has enjoyed having the BBC as our anchor tenant for the past 20 years, it is extremely helpful to have had such advanced notice of their decision & we wish them well with their new venture in Digbeth.
"We are really excited about the opportunity this presents for the Mailbox – it will allow us to reposition the building by refurbishing their space, offering to the market a rare 120,000sqft office suite in the heart of the city. It will create a great opportunity for Mailbox REIT to drive the rental value and capture the reversionary potential of the space.
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"We now have until the end of June 2026 to make alternative arrangements and are fully confident that we will be able to re-let the space ahead of that time.
"Mailbox benefits from a highly attractive combination of large and flexible floor plates, rare in the Birmingham market, a prime City centre, waterside location with popular on-site amenities and strong ESG credentials. With the BBC no longer in occupation, it will make our pathway to net zero more achievable.
"The current limited supply of grade A space within the city, and the constrained new development pipeline because of inflation and supply chain challenges, provides a very supportive leasing environment. These factors further underline our confidence."
Mr Barter hailed the opening in May of co-working hub Spaces, which has seen retail space on the ground floor converted into a 50,000 sq ft flexible workspace facility.
He said: "The facility is running ahead of expectations with more than 30% occupancy already. Alongside the new office, food & beverage and amenity leases announced earlier in the year, this progress further underlines Mailbox’s strong appeal to both larger and smaller occupiers."
Mr Barter added: "During the period the company built on the momentum achieved in the first quarter and over the last year, with continued strong rent collection, further valuation increases and the implementation of our ESG initiatives in line with occupier demand.
"However, we are well aware of the emerging economic headwinds and inflationary environment, which has led to an increase in the cost of debt. The Board is currently exploring appropriate avenues to mitigate these challenges. Nevertheless, we have been able to hold the quarterly dividend at the target level."