Mucklow has won planning permission with Helical Retail for a 33 acre development in Tyseley, Birmingham but will not start work until next year at the earliest.

The firm said: “Given the continued fragility of the occupier market we feel it prudent to put on hold any speculative development until a more confident and stable market returns.”

Mucklow saw pre-tax profits increase to £13.4m for the year to June 30 2012 from £12.2m last time.

But chairman Rupert Mucklow warned: “Demand is still patchy and while we continue to look at potential opportunities, the market is not strong enough for us to consider carrying out any new speculative developments.

“An increase in demand for Midlands industrial space and a dwindling supply of modern property would normally be the catalyst for rental growth and an improvement in capital values.

“However, these are not normal times and although there are supply constraints, the Midlands industrial market is still fragile and property investors remain concerned about future economic prospects.”