HM Revenue & Customs’ selection of Shelborn Asset Management’s 350,000 sq ft India Buildings in Liverpool as its preferred hub location has exacerbated a crisis of available office space in the city’s commercial core.
The stock-starved business district has seen more than 600,000 sq ft of offices sold or converted for alternative uses in the past 12 months, as developers have shied away from developing new schemes. Only a handful of buildings are currently able to offer grade-A space on a single floorplate of 12,000-15,000 sq ft, according to GVA’s Ian Steele.
“Given current levels of demand and absorption rates, it is likely that this supply will diminish within the next six to 12 months, leaving the city without any buildings that can offer occupiers large grade-A floorplates,” he said. “This is likely to diminish future levels of demand as well as Liverpool’s ability to attract large-scale inward investment.”
The Government Property Unit had shortlisted Peel’s Liverpool Waters for the HMRC requirement but is understood to have favoured India Buildings for its central location.
A further 200,000 sq ft requirement for unidentified government office space in the city remains outstanding. It is likely this will go to the Pall Mall Exchange, an 8.6-acre development site bordering Leeds Street and Tithebarn Street which could accommodate up to 400,000 sq ft. An OJEU process is under way to select a developer for the £200m mixed-use project; the three shortlisted parties are Muse Developments, a joint venture between Neptune Developments and Vinci Developments, and a joint venture between CTP and Kier Property.
The only other new build or proposed scheme is Peel’s No 5 Princes Dock, which has outline consent for 81,000 sq ft but is likely to need to be 40%-50% prelet before construction starts.
Guy Butler, director at Glenbrook Property, said the city needed public sector backing to get the market developing speculatively.
Available Grade-A buildings with floorplates of 12,000-15,000 sq ft
- No 4 St Paul’s Square
- No 5 St Paul’s Square
- 20 Chapel Street
- Royal Liver Building
- The Plaza
- 12 Princes Dock
Liverpool Offices sold or converted over the past 12 months
| Office | Sq ft |
|---|---|
| Martins Building | 155,000 |
| Silkhouse Court | 120,000 |
| Reliance House | 64,000 |
| 2 Moorfields | 63,000 |
| 60 Old Hall Street | 60,000 |
| 8 Water Street | 55,000 |
| Orleans House | 52,000 |
Source: GVA
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