Liverpool City Council is to add further funds to help the remediation of the city centre site, set to host up to 400,000 sq ft of commercial space and public realm.
With Leonardo Hotels already lined up to take the hotel and two major occupiers showing an interest in the office space, the city council has provided an update on the £200m project’s progress, which is being developed by Kier Property and CTP.
Remediation works are currently being carried out on the plot; the council secured £3.5m from the Liverpool City Region Combined Authority’s Single Investment Fund to clear the site for development. Willmott Dixon was appointed via the Scape framework to carry out the works.
However, since remediation works started, a number of issues including asbestos in the ground were identified, which the council said “are not uncommon” for jobs of this nature.
These have added additional costs for the site clearance, and as a result, the council is proposing to draw down an additional £350,000 from the Combined Authority, along with nearly £160,000 of its own money, to fund the completion of the remediation, which now has an estimated total cost of £4.3m.
Overall, the council expects to fund its contribution to the scheme through £410,000 of unsupported borrowing. Money from the SIF is paid retrospectively, meaning to date, the council has spent £3.8m from its capital budget to fund the works.
Willmott Dixon’s remediation works have been completed with the next phase including the addition of a substation to support the wider scheme. This substation is due to be completed in June 2020, which will allow the main build to begin.
A hybrid application for the three-acre city centre site was approved in October by the council; this includes full permission for a 112,000 sq ft office and public realm, along with outline permission for hotel and two further offices.
Place North West revealed Leonardo and Kier had agreed heads of terms on a 281-bedroom hotel at the site in August this year.
The city council also said there were “advanced discussions” with occupiers for a pre-let, although Place North West understands a deal is not imminent.
Two major occupiers with a 100,000 sq ft requirement are understood to have looked at the building. Rathbones is on the hunt for a new office in Liverpool, while Place also revealed in October that BT had shortlisted the development as part of a wider search for a 100,000 sq ft hub in the city.
A main contractor for the offices or hotels is yet to be appointed but is likely to be chosen via a tender list from Liverpool City Council. Work on the hotel, offices, and public realm is due to begin next summer.
Future phases, covering land stretching to Leeds Street, are likely to include a wider mix of uses including residential and a multi-storey car park.
The additional funding is set to be signed off by Liverpool City Council’s cabinet next week.