The Mailbox sold for £127.1m

The Mailbox, the canalside shopping, office and leisure complex that is home to BBC Birmingham and Harvey Nichols, has been sold for £127.1 million.

The buyer is a joint venture between the property investors Brockton Capital and Milligan.

From sorting office to landmark

The building was originally the Royal Mail's main sorting office for Birmingham. Completed in 1970, it was the largest mechanised letters and parcels sorting office in the country and the largest building in Birmingham, with a floor area of 20 acres. A tunnel under Severn Street linked it directly to New Street station so that mail could be taken straight from the trains.

When Royal Mail moved out, the developer Alan Chatham, who had worked on the regeneration of Brindleyplace, saw its potential. Unable to persuade Argent to take it on, he set up his own company, the Birmingham Development Company, and bought the building in 1998 for £3 million, plus £1 million for surrounding waterfront buildings.

A £150 million transformation

The conversion, designed by the Birmingham architects Associated Architects, stripped the building back to its steel frame. The £150 million scheme opened in December 2000, with shops, restaurants, offices, two hotels and apartments built above by Crosby Homes.

The Mailbox quickly became one of the city's most fashionable addresses, attracting designer shops including Harvey Nichols and a string of waterside bars and restaurants along the Worcester and Birmingham Canal.

The BBC moves in

In 2004, BBC Birmingham moved into new studios at the Mailbox, replacing its famous Pebble Mill studios in Edgbaston. The public can watch programmes being made from a public foyer, and radio shows including The Archers are made there.

What the new owners plan

The new owners are expected to look at ways of improving the complex and attracting more visitors. The Mailbox faces growing competition from other parts of the city centre, including the Bullring and the planned redevelopment of New Street station, which will include a new shopping centre.

Parts of the complex, particularly the approach from the city centre through the underpass beneath the ring road, have been criticised as unwelcoming.

A sign of confidence

The sale is one of the largest property deals in Birmingham for some time, and comes as the property market begins to recover from the financial crisis and recession of recent years.

For the city, the Mailbox has been one of the success stories of its regeneration, turning a vast, windowless industrial building into a destination that has helped draw people and businesses to the southern side of the city centre, close to Gas Street Basin and Brindleyplace.