LAST year saw a big drop in the take-up of office space in Liverpool.
Sales and lettings held up OK for the first nine months of the year, but then the wheels came off as the full impact of the credit crunch finally hit the local market.
Take-up of office space in 2008 finished 36% down on 2007.
This year, you might think things could get even worse, but it seems we have got off to a flying start in 2009.
Earlier in the year, Merseytravel announced it was taking 140,000 sq ft at the new Mann Island development.
And, in today’s LDP Business, we reveal how the UK Border Agency is now on the verge of signing up for a whopping 200,000 sq ft at Downing’s Capital building in the heart of the city’s central business district.
Some might be tempted to point out that both tenants are public sector, indicating the city is still struggling to attract a major blue-chip tenant to the city.
But a letting is a letting and is not to be sniffed at in the current environment.
The Mersey Partnership, the body responsible for attracting inward investment to the city region, believes the private sector lettings will come.
They claim the downturn means that big financial services firms may look to relocate functions from the very expensive offices they occupy in the City of London out to regions like Merseyside.
Let’s hope they’re right – but, if they are, then we face the problem of a lack of quality space going forward.
The Border Agency will happily move into the refurbished space being provided by Downing at the Capital.
The property firm claims the standard of refurbishment puts the accommodation on a par with any brand-new Grade A space elsewhere in the city.
That may be true, but most blue-chips will these days demand brand new accommodation. Refurb just won’t do, whatever the standard.
If demand from the private sector for space in the regions does pick up when the recession is over, the worry is that Liverpool will not have the stock to meet it.
In the city centre at the moment, the only Grade A stock available is at 20 Chapel Street and some at St Paul’s Square. If a major financial institution came along tomorrow looking for, say, 100,000 sq ft of Grade A, what could we offer them?
And the current economic and regulatory climate makes any immediate improvement to this outlook unlikely.
Any developer looking to build a speculative scheme has to contend with a lack of bank finance, ever more stringent environmental regulations and the Government’s much-criticised tax on empty properties.
ANYONE for Pimm’s? Not at this year’s Liverpool International Tennis Tournament.
A smooth pint of bitter seems more likely for those in the hospitality section next month, after city brewer Cains was revealed as a major sponsor of this year’s event.
The deal comes just months after the Dusanj brothers rescued the firm from administration. Let’s hope this agreement is a sign of new-found confidence at the firm.
The tournament itself also seems to be defying the recession.
Organisers Northern Vision report around 85% of corporate hospitality places are already sold.
This is an encouraging vote of confidence from the local business community.
