Place strategy

The Royal Liver Building is no longer for sale

Attention will now turn to the next phase of upgrades after bids for the top-tier Liverpool office fell short of the owners’ £90m aspirations.

Corestate, which has a 35% stake in the Royal Liver Building, asked CBRE to find a buyer for the property in March, five years after it acquired the 330,000 square foot asset for £48million.

Everton FC owner Farhad Moshiri owns 49.9% and the remaining 15.1% is owned by a group of international investors.

A CBRE spokesperson said the opportunity had generated “significant global and national interest”, but confirmed the sale process was now “on hold”.

“The owners are moving forward with the active management of the property’s assets and delivering the next phase of the Royal Liver Building’s world-class occupancy environment.”

The next stage of the upgrade will see the creation of 500 to 9,000 square foot suites in the West Atrium.

A similar approach has been taken in the East Atrium and these offices are now fully let to occupants, including Mott Macdonald and aesthetics of the Royal Liver Building. The atrium is also includes a relaxation area, meeting rooms and a café/bar.

“The success of Atria East’s offices has illustrated the pent-up demand in the market for very high quality offices, with state-of-the-art equipment and facilities and we hope to build on this,” said Neil Kirkham, Managing Director of CBRE.

In addition to attracting tenants, the creation of more modern workspaces could also continue to drive up the building’s rents.

When Corestate acquired the property in 2017, 125,000 square feet was vacant and rents reached £15/square foot, according to Kirkham.

These days the void is down to around 25,000sqft – Everton FC took 28,000sqft in 2018 – with some occupants of traditional leases paying £28/sqft, the highest rents in the city, said Kirkham.

The ninth-floor plug-and-play space suites, installed as part of CBRE’s asset management strategy, generate £33/net square foot.

In the basement, plans for a 17,000 square foot gym, complete with swimming pool, have fallen foul of pandemic uncertainty.

However, plans for a reduced fitness offer remain and an application for it was made to Liverpool City Council this summer.

Corestate’s focus at this time is to maximize the potential of its assets and although a sale is not imminent, a change in ownership structure could still occur.

Earlier this year, Farhad Moshiri refused to rule out acquiring a bigger stake in the building when approached by North West Square.