UK’s largest mixed use building for sale

The Mailbox, the UK’s largest mixed use building is on the market for sale.

The 1.5 million sq ft development in Birmingham city centre has played an integral role in Birmingham’s regeneration. The Mailbox has become the most prestigious retail, office and residential destination in the UK’s second largest city and is regarded as one of Birmingham’s biggest commercial assets.

The multi award-winning scheme is home to regional headquarters, offices, retail, apartments, hotels, restaurants and one of the best car parks in the country. Anchored by Harvey Nichols, which has recently increased its leasing space by 35% to accommodate demand, it is let to renowned names including Emporio Armani, Hugo Boss and Bang & Olufsen alongside the BBC, Network Rail, Virgin Media and Malmaison. It has established itself as the ‘pitch’ for high-end retail in Birmingham and the wider region, complementing the high street offer of the Bullring.

The proposed sale will include The Mailbox and the final phase of The Mailbox, known as The Cube.

Alan Chatham and Mark Billingham, co-owners and directors of Birmingham Development Company said: “The Mailbox has achieved phenomenal success since opening in 2000 with a regional and national profile as one of the UK’s most prestigious mixed use schemes. The Mailbox has played a significant role in attracting huge investment for the city centre and acted as the catalyst for considerable redevelopment and regeneration in and around the area.

“The sale of the scheme will allow us to focus on new projects both within Birmingham and elsewhere. First and foremost we will complete The Cube which will add a further 500,000 sq ft in addition to 1.5 million sq ft of space at The Mailbox.”

With world-class designer boutiques and well-known restaurant operators, The Mailbox has an affluent, sophisticated and loyal customer base which recent CACI research has shown with a 45% AB shopper profile, well above the national average of 25%. The scheme’s trading figures have netted over £60 million in 2005/2006 and sales transaction value is well above the average.

Currently The Mailbox commands an income of approximately £10 million per annum; 45% offices, 25% retail, 13% restaurants and 17% car parking with high growth expectations. In addition there are 144 residential apartments, some of the most sought after in the city. Indeed, within Birmingham, The Mailbox has been the catalyst for what is now the largest and fastest growing residential area in the city.

There are in excess of 5,750 households in the immediate area, forecast to rise to almost 10,000 by 2010. This equates to a 285% increase since 2001 and 68% on today’s position.

Philip Cropper of CBRE Real Estate Finance, who represents the vendors, said: “The sale of The Mailbox is of huge significance for the city, firmly cementing Birmingham’s position as a city of international worth. As a building of such high net worth, we have already begun tentative talks with a number of parties and expect a sale to be completed quickly.”

The sale of The Mailbox includes significant asset enhancement opportunities including the funding of the 25-storey iconic building The Cube, the final phase of the scheme. The Cube is also mixed use with luxury apartments, a boutique hotel, offices, shops and restaurants. Designed by Ken Shuttleworth’s MAKE, the architect renowned for the ‘Gherkin’, the building is now underway with completion scheduled for early 2010.

D&D London confirmed this week it has exchanged contracts with Birmingham Development Company to develop a 12,000 sq ft rooftop space at The Cube in Birmingham into a complex of restaurants with associated bars, private rooms and gardens. This will represent D&D’s first venture outside London in the UK and follows openings earlier in the year in Copenhagen and Tokyo.

This will be one of the most sought after venues in Birmingham and the city’s first ever panoramic rooftop restaurant. The restaurant interior is to be designed by Conran & Partners and will be surrounded by 10 metre high glass to provide spectacular views across the city.

Alan Chatham, Mark Billingham and the BDC team remain committed to the ongoing redevelopment of Birmingham and have, as part of their long-term business strategy, investment plans for further projects in the city, which will be unveiled later this year.

The guide price for The Mailbox is in excess of £200 million. BDC is seeking a price for The Cube that reflects a funding yield of 5.5% that equates to in the order of £100 million.