A LANDMARK waterfront development in Liverpool has been rescued with a £3m bail-out from the North West Development Agency.

Merseytravel, which is due to take the lease on a £46m office building at Mann Island, admitted that without the cash the project would have been in jeopardy.

Last night, Merseytravel chief executive Neil Scales said he was "very grateful" to the Agency for the grant to enable the project to proceed.

Steve Broomhead, chief executive of the NWDA, said the agency had invested £50m in the city’s waterfront and was vital its development did not lose momentum.

Neptune Developments, which is building the office block, said the project would now remain on target for completion in early 2011.

In January, Merseytravel signed a 30-year lease on the 140,000 sq ft building for it to become its new headquarters.

The transport authority was originally due to occupy the entire 11-storey building, but, due to an efficiency drive, which will include job losses, no longer requires three floors.

Mr Scales said: "We did look at chopping three floors off, but that would have meant going back to planning.

"I think the deal would have been in jeopardy if we had not had the grant. We are very grateful to the development agency for their support."

The building is one of three "granite wedges" being put up next to the Three Graces.

The other two include apartments, shops and restaurants. Last year, the residential elements was sold for £70m to investment group Dylan Harvey in the biggest deal of its type in the city.

The first phase on the residential blocks is due for completion at the end of 2009, and the second phase a year later, while work on Merseytravel’s HQ is expected to start in June.