AY predicts an uptick in activity in the rest of the year. Credit: via Marketing Liverpool

Liverpool office market cools in Q1 

Having recorded a combined 106,000 sq ft of deals in the last quarter of 2021, the amount of space transacted in the first three months of this year was 80,000 sq ft, according to Avison Young’s latest Big Nine Report. 

Liverpool’s out-of-town market far outperformed the city centre in Q1 of 2022; 72,700 sq ft of deals were signed in the likes of Wirral, Wavertree and Knowsley, while just 8,000 sq ft of space was let in the Liverpool’s central business district. 

Indeed, the five largest transactions were all in the out-of-town market. MJ Quinn’s 11,200 sq ft deal at Nexus in Knowsley was the standout deal. 

The biggest deal in the city centre was Keller Lenker UK taking 3,293 sq ft at the Cotton Exchange. 

Despite underperforming in the first quarter of 2022, Avison Young predicts city centre take-up could increase as the year goes on. 

“Although Q1 take-up was low, demand and enquiry levels have increased and there are a number of large active requirements in the market,” the report said. 

“There are a number of deals close to completion which should see a significant increase in take-up during Q2 and Q3.” 

Liverpool continues to suffer from a lack of supply of grade A office space, which has resulted in upward pressure on rents, Avison Young said. 

The headline rent in the city increased during Q1 from £22/ sq ft to £23/ sq ft. 

Despite a lack of supply, speculative development of offices in Liverpool has not been forthcoming and the wait goes on for pre-letting activity at major development zones including Pall Mall and Liverpool Waters. 

Other office schemes coming forward in the city include Kinrise’s conversion of St Martins Bank, which could provide 160,000 sq ft of space, as well as Hemisphere, the next phase at Paddington Village. 

However, these projects are not likely to complete until 2024 at the earliest. 

Liverpool was by no means the only city to report a drop in office market activity in the first three months of 2021. Across the nine largest markets outside London, take-up totalled 1.8m sq ft, a 40% decrease compared to the final quarter of 2022, according to Avison Young. 

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Liverpool has missed the boat, the trend for home working will slow office development across the country.

By Anonymous

If Liverpool has missed the boat well then so has London Leeds and NYC ?

By Anonymous

Though demand for offices may have slowed there are still opportunities out there, and if we do nothing clients will go elsewhere and find space, we need to have quality office space “oven ready” and be pro-active rather than reactive, and on the scale of things the Pall Mall scheme is worth proceeding with.

By Anonymous

The real reason for poor demand for office space, business activity or expansion is well know its the anti business hard left council and its never seen Mayor . Its sad to say but our city is becoming a backwater comparative to Manchester and Leeds and its absolutely down to terrible leadership who want to take us backwards . Our bright young talent have to leave or accept a commute to Manchester . When did you last see the council banging the drum for new business ???

By Paul M - Woolton

The commute to Manchester is 40 minutes. That is what people in Reading do each day to get to London. Liverpool is a 40 minute commute from Manchester too. We need to get out of this parochial mindset in the North West, that a job should be on your doorstep. If there are opportunities in Preston, go to Preston. If there are opportunities in Leeds, go to Leeds. That is how a global economy works.

By Elephant

Leeds already has a healthy office market and London and NYC are world leading financial centres with massive office developments but even for these cities there will be a slow down in new developments due to the working from home trend. Unfortunately Liverpools office market has never really got going so there is a danger it has missed the boat.

By Anonymous

All positive for Liverpool just like the LFC trophy cabinet

By Anonymous

Manchester’s huge investment in Business districts over the years has mopped up the requirement for many companies coming to the North West . It’s hard to get speculative investment against that especially in an environment that seems to be anti business.

By Anonymous

Castore left Liverpool and took their office to Mcr, presumable to find quality accommodation that would attract the workforce they wanted to recruit, don`t tell me that if something impressive had been offered in Liverpool they wouldn`t have chosen it.

By Anonymous

Major opportunities being missed Liverpool council needs to get on with the pall mall scheme ASAP . I Also note the criticism from the maritime community re the constant delays on the cruise liner terminal ( weak excuse need to see how the demand for cruises goes 😀) the council is failing in many areas of regeneration

By George

In Liverpool the boat is never missed we are a proud city on a beautiful waterfront so the boats keep coming and we will continue to build and we have a great future as this city looks out not in .
We don’t want to be Manchester Leeds London thats always been the case we do our own thing
Liverpool is one of the biggest brands in the country and outstrips Manchester completely , few more office blocks don’t make you better .

By Anonymous

The report always makes interesting reading but no surprise there has been a slowdown in the circumstances. Even the biggest office markets like London and Manchester have felt the effects and that will go on for some time yet.

By Trev

Ah but Brands are just illusory and have both positive and negative connotations. No one is comparing Liverpool to Manchester or London, there would be no point they are very different places. What’s not illusory is that our local politicians need to try harder, attract jobs and attract investment. I’ve never lived anywhere where I’ve felt our local leaders are so capable of shooting themselves in both feet.

By Anonymous

If there’s any city too inward looking it’s Liverpool

By Anonymous

It’s complicated picture but the main reason why some companies start in Liverpool and move or bypass Liverpool altogether is there is a more pool of skilled workforce elsewhere like Manchester. Liverpool still attractive to likes of Sony. But even companies that brand themselves with Liverpool end up having a bigger base in Manchester. Liverpool is a great start up city, cheap easy, to locate but chances are the more innovative or tech hungry or financially viable it won’t stay.

By Anonymous

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