Government funding for a series of major Liverpool regeneration projects is set to unlock stalled development schemes in Liverpool city centre as ministers step up efforts to drive regional growth outside London.
Chancellor Rachel Reeves has confirmed backing for four Liverpool developments, including the £60 million Pall Mall Gardens office and park scheme and the redevelopment of the historic Martins Bank building.
The projects form part of Liverpool City Region Combined Authority’s wider £2 billion investment programme and are backed by an additional £95 million in government funding designed to help delayed regeneration schemes move forward.
Developments will support more than 2,500 jobs
The developments are expected to support more than 2,500 jobs and form part of wider attempts to attract businesses, investment and new commercial activity into Liverpool city centre.
The funding model is based on using limited public money to help unlock significantly larger sums of private investment, particularly for schemes that have become harder to finance following sharp increases in borrowing costs and construction inflation over the past two years.
Public-sector funding has become increasingly important across parts of the regional development market as viability pressures continue to slow or delay projects, particularly in cities where commercial rents are often lower than in London despite rising build costs.
Shortage of modern Grade A office space
The announcement also comes in the midst of a prolonged shortage of modern Grade A office space in Liverpool’s commercial district. Pall Mall Gardens is expected to become the city’s first new-build Grade A office development in the area for more than a decade.
Pressure on office supply has become an increasing issue for several regional cities as occupiers seek higher environmental standards, improved energy performance and a more modern workspace.
Liverpool has already undergone substantial regeneration over the past decade, particularly in the residential and mixed-use sectors. Areas including the Baltic Triangle, Princes Dock and parts of the waterfront have seen large volumes of apartment development, student accommodation and leisure-led investment.
heritage assets playing growing role
The redevelopment of the Martins Bank building also highlights the growing role heritage assets are playing in city-centre regeneration strategies. Historic commercial buildings are increasingly being repurposed for office, hospitality and mixed-use schemes as councils attempt to attract employers, residents and footfall back into urban centres.
Liverpool has benefited from considerable investment in build-to-rent, student accommodation and large-scale residential development over the past decade, helped by lower entry costs than many parts of London and the South East.
Regional apartment yields have also remained comparatively attractive in several northern cities despite higher financing costs and softer investment activity across parts of the market.
Manchester, Birmingham and Leeds have all seen major city-centre regeneration programmes in recent years as regional authorities compete for employers, residents and institutional investment.
For Liverpool, the latest package marks another stage in the city’s longer-term shift towards a more mixed commercial, residential and service-led economy centred around large-scale urban redevelopment.
