Wirral Council has yet to attract additional tenants to its new £75m office buildings.
The local authority is currently looking for companies to move into its new offices that have been built at Alice Ker Square in central Birkenhead. The developments are one of the first projects delivered through the council’s regeneration plans to create more modern office space within the town.
Funded in advance by a £75m investment by the private sector, the council is facing repayments of more than £2m a year for the next 35 years. After this, it can buy the buildings for £1.
The local authority expects to make an overall annual profit of around £500,000 once the offices are fully let and Wirral Council is currently in the process of moving into one of the buildings, spending £9.2m on fitting it out. It is expected to then save money on rent it was paying to have offices in the Cheshire Lines building on Canning Street, Birkenhead.
In July 2023, Wirral Council set aside £2m of Wirral Growth Company profits from the joint venture corporation to cover the lease costs after construction finished in October as well as repairs needed in its old offices. The council’s latest accounts said it would use the profits to meet the office’s initial two-year costs as well as future regeneration projects.
According to a January regeneration budget report, the council is expecting a £2m pressure related to the Birkenhead Commercial District for the next financial year between April 2024 and March 2025. It predicts it will make £500,000 every year after that.
Asked by Cllr Jo Bird about the figure and whether the council was making progress in getting tenants, Wirral Council director David Hughes said, “The £2m pressure is not just for potential void periods, it’s for a whole range of issues which are related to the build out completion. In relation to the market, as you’re aware, marketing has commenced and is proceeding well at this stage.”
He added, “We have only been actively marketing for a couple of months. We don’t actually have any tenants apart from the council’s occupancy.”
Asked to clarify what was meant by the buildings having “a whole range of issues,” a Wirral Council spokesperson said, “Wirral Council’s Policy & Resources (P&R) committee approved £9.2m in September 2023 to enable the capital fit-out of the office space Mallory that authority staff will occupy as part of the relocation from the current offices at Cheshire Lines Building. A report will be brought back to P&R committee on total spend to date of the £9.2m.
“Mallory and Irvine, at 2 & 4 Alice Ker Square, are high-quality office spaces in the heart of Birkenhead which will play key role in the council’s ambitious regeneration plans, as well as bringing valuable additional footfall to the town centre.
“Currently council officers are working with our letting agency partner to identify potential occupiers and will of course ensure there is appropriate budget in place to fund costs in the event that space is not let as part of the new financial year.”
Image: Irvine (Red) And Mallory buildings. Credit: Edward Barnes