Adam Fleming, Senior Surveyor in Fisher German’s Liverpool office, has reviewed the latest figures from the Liverpool Office Agents Forum (LOAF) and believes the slowdown says more about short term caution in the market than about the city’s long-term appeal.
Take-up in Liverpool city centre reached 25,868 sq ft across 18 transactions in Q2, down from 60,471 sq ft across 27 transactions in Q1.
At first glance, these figures may appear discouraging, but it is important to bear in mind that this drop is not spread evenly across the market.
Deals between 5,000 and 10,000 sq ft made up more than half of Q1’s activity across five transactions. In Q2, that category produced a single deal.
However, deals for smaller spaces performed better. 15 transactions completed below 2,000 sq ft in Q2, close to the 18 in Q1, proving a steady demand for smaller suites in the city, which is reflective of the activity and growth of SMEs and start-ups in Liverpool.
Bruntwood’s The Plaza took one of the most high-profile deals of the quarter with the Billingtons Group taking 5,687 sq ft of space, just as it was in Q1 when RSM relocated there. Other highlights included Cotton House letting to Medical Law Services and the Royal Liver Building letting to Pro Global.
These deals show the appetite for high-quality space in Liverpool has not disappeared. Occupiers moving into buildings like The Plaza and the Royal Liver Building are doing so because those buildings offer the specification and flexibility that modern occupiers are looking for. Liverpool just doesn’t have enough of these spaces to cope with demand.
Headline rent eased to £25.00 per square foot, down from the £26.50 achieved by the RSM letting in Q1. It keeps Liverpool below the near £30.00 mark the market has been working towards. For Liverpool to close the gap with Manchester and Birmingham, where Grade A space now commands £45 to £50 per square foot, it needs new-build supply to reach the market. That has not changed.
Progress in some major projects in the city could change things.
VINCI was appointed in July as design and build partner for the first phase of Pall Mall, a 111,000 sq ft net zero office scheme backed by a £15 million grant from Liverpool City Council and support from the Combined Authority’s investment fund.
It will be Liverpool’s first new-build, city centre Grade A office in more than 15 years. While no start date on site has been confirmed yet, a contractor is now in place which is the clearest sign in a long time that this scheme is a step closer to reality.
Additionally, Mayor Steve Rotheram’s proposal for a Mayoral Development Corporation covering Liverpool’s North Docks has just completed a six-week public consultation, with more than 85 per cent of respondents in support. It could see up to 17,000 homes and five million sq ft of commercial space built along the waterfront.
The Combined Authority is due to consider a formal proposal later this month, ahead of a request to government to formally establish the corporation.
It is still early days, but a project of this scale could make a massive difference to the city’s fortunes.
Despite the quieter Q2, these projects are the reasons I remain cautiously optimistic about where Liverpool’s office market is heading through the rest of 2026.