Private investors will back Liverpool’s £200m Pall Mall scheme, insists developer

Kier’s development arm has formed a joint venture with the city council to deliver 400,000 sq ft of badly-needed grade A office space – but question marks remain over the funding. Tony McDonough reports

Pall Mall
Image of Liverpool’s proposed £200m Pall Mall office scheme


Construction giant Kier insists Liverpool’s proposed £200m office scheme at Pall Mall can secure private sector funding despite current headline rents being too low to tempt speculative developers.

CTP and the development arm of Kier have formed a joint venture with the city council to deliver 400,000 sq ft of badly-needed grade A office space in the city’s central business district. The JV has secured £3.5m from the Merseyside Combined Authority for site remediation works.

And Tom Gilman, managing director (North) Kier Property, told LBN that work on the project would begin in 2019 with delivery of phase one in 2020.

Speculative development of office space is driven by rental levels. At £21.50 per sq ft Liverpool’s headline rent is the lowest of the nine regional UK office markets and is considered too low to tempt investors. A rental level closer to £25 per sq ft could provide a catalyst.

And Mr Gilman insists the proposed quality of the accommodation at Pall Mall would command a rental level that could get the development moving. He said: “The intention of Kier and CTP is to finance the project with private sector resources.

“We plan to develop the first grade A office space in 10 years for the city with this scheme.

“In this period standards and specifications have changed substantially, as have occupier needs, and the office space we will deliver at Pall Mall will be at the forefront of contemporary office design and will command a better rent profile than has been the norm in the city.”

Liverpool’s city centre grade A pipeline has dried up. The only remaining space of grade A quality now left in the central office core is at No 4 St Paul’s Square and 20 Chapel Street. Add to that the fact that around 1m sq ft of office space has been lost to residential/leisure conversion in the past two years.

Pall Mall is a 1.6 ha site to the rear of Exchange Station. A planning submission is expected to be made in late spring 2018, and subject to approval, the developers are then expected to start on site on the first phase of the masterplan, which will be the regeneration of the Pall Mall NCP car park area.

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