He will now stay at St Andrew’s for another 12 months at least.
“David’s certainly going to be a strong player for us during this run-in,” Rowett told BBC WM 95.6.
Smethwick-born Davis, who has also had spells with Walsall, Shrewsbury Town and Chesterfield, made his 50th league start – and first since January – for Birmingham in their goalless draw against former club Wolves.
The result leaves Rowett’s men eighth in the Championship, four points off the top six with 10 games remaining.
And the Blues boss is adamant Davis has a big role to play.
“He controls games with his physicality – he holds people off and comes out with the ball,” Rowett said.
“He’s been very patient waiting for his chance and he was absolutely magnificent against Wolves.
“I’ve had half an eye on bringing him back in and, certainly away from home, playing with three midfielders isn’t the worst way to go.”