Liverpool City Council is to buy the shopping centre above Central railway station from Aviva as it seeks to accelerate regeneration schemes including Augur’s neighbouring Circus project.
A report to the council’s cabinet tomorrow recommends approval for the purchase of a 114-year lease on Liverpool Central Shopping Centre, and for the council to simultaneously enter into a 20-year underlease with Liverpool CSC.
Although the purchase price has not been disclosed, the deal is understood to be worth around £17m.
The proposed tenant company is related to the Augur Group, which has taken over the previously stalled redevelopment of the Lewis’s building and five acres of surrounding land.
Augur bought the Lewis’s building and the land last summer, and started a £1.5m restoration programme for the 400,000 sq ft building, which along with new build elements has been rebranded as Circus – effectively taking over from the mixed-use Central Village scheme previously promoted by Merepark.
Liverpool CSC will have an option to purchase the shopping centre, which due to doubling as the railway station’s main entrance attracts footfall of 16m people per year, from the council after five years.
The underlease for Central shopping centre, which contains 21 retail units covering more than 50,000 sq ft, will earn the council £4.3m over the first five years.
Buying the centre falls within mayor Joe Anderson’s “Invest to Earn” strategy, which uses the council’s ability to borrow at low rates to stimulate profit that is then reinvested in services, along the lines of the purchase of the Cunard Building, which now generates a rental income of £2m a year.
The council is currently assessing tenders to develop a masterplan for the Knowledge Quarter Gateway zone, which includes Lime Street and Bold Street and is intended more effectively connect the £1bn Paddington Village scheme to the main retail core of the city centre.
Anderson said: “The purchase of Central Shopping centre is too good an opportunity to pass up. It enables us to acquire a strategic site in a prime city centre location which we have plans to regenerate and the investment makes a profit for the council to reinvest in our services.
“The beauty of this deal also means that plans for Lime Street, Lewis’s Building, Circus Liverpool and Central Shopping Centre are now all interconnected. This will all help to underpin the development of the Knowledge Quarter Gateway which is the next major piece in a 10-year plan to regenerate the city centre and finally connect the waterfront to our universities.”