ark.shoplus.net

Wirral Council's properties 'worth £9m less' than when local authority bought them

2025-03-23 22:01:09 By

Investment properties purchased by Wirral Council have seen a drop in value of more than £9m since their acquisition, an auditors' report has shown. The portfolio includes notable assets such as Birkenhead's Vue Cinema and the Europa Centre, both of which had already seen a decline in value.

On January 6, auditors Grant Thornton published their annual report on the council's financial accounts, ahead of an emergency meeting scheduled for January 14. The audit firm made a legal recommendation and identified three major weaknesses within the local authority, making two key recommendations and a further 12 suggestions for improvement.

According to the report, the council is legally required to publicly respond to these recommendations under the Local Audit and Accountability Act 2014 as it is "in an extremely challenging financial situation with significant financial pressures creating budget overspends combined with low levels of reserves."

This week, the council announced plans to seek a £40m bailout from the government over the next two years, stating it would likely face bankruptcy without this support.

In response to the report, Wirral Council's leader, Cllr Paul Stuart, stated that the council is "implementing detailed and stringent measures to address the financial challenges," adding: "Years of underfunding and the rising costs and demand for social care services have outstripped available funding necessitating major changes in operations, including some very difficult and unwanted decisions to ensure the council can provide its statutory services and look after and take care of our most vulnerable residents.", reports the Liverpool Echo.

He acknowledged that the audit pointed out several areas where financial management could be improved, but he also noted: "The reality is that regardless of efforts there has not been and still is not enough money to maintain services as they were."

The auditors raised issues about the council, including a projected increase in school finance deficits, problems with SEND services, compliance with an improvement notice, placement costs for children in care, and councillor oversight. One issue pertains to the council's investments in recent years, as the value of the council's commercial properties funded through borrowing "have significantly reduced in value which creates financial risk to the council."

These properties were purchased to support the council's planned regeneration of Birkenhead rather than for financial reasons.

The purchases included £8.4m for the Europa Centre in Birkenhead, where Wilko was once a major tenant, £6.8m for the Birkenhead Vue cinema, £10.59m for the Pyramids and the Grange shopping centres, as well as £9.2m in other investment properties. As of March 2024, these were estimated to be worth a total of £30.1m.

However, following an audit, these properties are now valued at £26m, marking a 25% decrease from their purchase price. The auditors found no evidence that the council was considering selling any of these properties, despite the investment strategy predicting a return of 3.17%.

They warned that the £9m drop in value "does create financial risk to the council" and highlighted that the council had stated it would review these properties if their value fell "significantly below their purchase cost."

The auditors recommended that the council provide members with an updated investment strategy report detailing the most recent values of its commercial properties, the financial impact of the valuations, and planned council activity to manage any financial risks. This, they said, would improve transparency and oversight.

In response, the council management stated that all investment properties were valued annually and that the inclusion of these properties in the investment strategy reported to councillors would be considered. They emphasised that all decisions regarding assets were made by the Economy, Regeneration and Housing committee.

Highly Recommended

Plans to move Merthyr Tydfil's indoor market to new location

Merthyr Tydfil's indoor market is set to move, the council has announced. It will relocate to the ground floor of the former Wilko premises in St Tydfil's Shopping Centre. A concept plan has been drawn up for a more multifaceted, modern marketplace, with traditional elements. The space will also feature a sensory area, a separate performance area and an exhibition space. It will feature a produce market, a market academy for future traders and improved facilities. The move follows a consultation which was held with stallholders and the wider public and the hope is it will be up and running by Christmas. Councillor Jamie Scriven, cabinet member for regeneration and housing, said: "I am delighted as the new cabinet member to be taking this project forward with my dedicated team of officers. The town centre's development moving forward is incredibly important to me and I want to ensure that we get this right for the people of Merthyr Tydfil. "During the Merthyr Tydfil Placemaking Plan consultation, we listened to the community's suggestions about relocating the current indoor market, and the plans we have in place now reflect that feedback. The new market will feature a produce market, a market academy to nurture future traders, and improved facilities for our tenants. "It will also offer opportunities for pop-up stands, making it easier for people to explore a career in market trading. We've shared these plans with our current tenants and are now working closely with specialist architects to bring this vision to life.

Closure prompts interior design team to launch new firm

A new interior design firm has been launched by staff from a previous company which closed down last year. Chapter 9 Design in Redditch has been born out of Claude Hooper which ceased trading following the retirement of its eponymous founder. It has set up shop on the Moons Moat industrial estate after agreeing a six-year lease on a 1,756 sq ft office in Croft House. Senior interior designer Sarah Clements said: "After the retirement of Claude Hooper, we decided that we wanted to use our experienced team and bring fresh ideas and creativity to our clients. "Our stylish and attractive designs can play a big role in highlighting the strengths of a new home. "We took our proposal to a leading local businessman, Stephen Lomas, and he agreed to back us and come on board as the managing director. "With his support and our experience, we are now securing work all over the country so being based in Redditch at the heart of the UK motorway system is hugely useful and gives us national reach." James Haynes, apprentice surveyor at Redditch property agency John Truslove, worked with the firm on sourcing a new office. He said: "It is great to see such a talented and committed team of people creating their own new business and we are delighted to have been able to help them find the right premises.

Take up of office space in Cardiff in 2024 the best for seven years

Take-up of office space in Cardiff had its best year in 2024 for seven years with the letting of the 1 John Street building to Lloyds the standout deal. With the headline rent for the city increasing to £28 per sq ft, the year saw letting deals totalling 581 643 sq ft, according to research by property consultancy Knight Frank. In the highest level of take-up since 2017, the rate was more than double that in 2023. The final quarter of the year contributed 247,137 sq ft, the highest quarterly return since Q3 2017. The final quarter saw Lloyds agreeing a 10-year lease for the entire speculatively built 113,000 sq ft 1 John Street building from developer JR Smart in the city centre. The bank's new hub for 3,000 staff will be completed later this year, with Lloyds taking occupancy of the grade A building in the second quarter of 2026. Mark Sutton, office agency partner in Knight Frank’s Cardiff office, said: “There were 92 office deals concluded in the year with an average deal size of 6,322 sq ft, more than double the figure for last year and 40 per cent ahead of the 10 year average.” Prime rents for the city moved onto £28 per sq ft in Q3, with occupiers continuing to focus on prime space with just 16 grade A deals accounting for 45 per cent of the quarter’s take up. Mr Sutton said:“With continued demand for the best quality space we will see the availability of grade A space continue to decline in 2025 and this will translate to further pressure on rents, pushing them beyond £30 per sq ft this year.” Office vacancy rates inclusive of out-of-town areas stood at 11% the end of 2024. Mr Sutton added:“The stand out deal of 2024 was Lloyds Bank signing up to take a lease of 1 John Street, a stand alone 113,000 sq ft office building at the head of Callaghan Square in the heart of Cardiff’s central business district,” Other notable deals in the city centre included professional advisory frim PWC signing up for 33,166 sq ft at 1 Central Square, and Aldermore Bank’s move across to the 28,098 sq ft 2 Central Square, along with the sale of the 50,934 sq ft Wilcox House at Celtic Gateway. Cardiff Gate led the out of town deals with Welsh Government’s acquisition of the 51,411 sq ft Centre 7 to create a new hub for the semiconductor industry. Overall, the financial services and banking sector took centre stage in 2024 with the 17 deals in this sector totalling 253,057 sq ft and accounting for more than half of the year’s total take up, High-profile deals in the sector also included expansion from Starling Bank at Brunel, and Go Compare’s move to Hodge House. Looking at availability in 2025 Mr Sutton said: “With no new buildings being delivered in 2025 the severe lack of prime office space will be a continued trend for the year ahead. Grade A availability has dropped below 300,000 sq ft and with several live requirements between 15,000 and 50,000 sq ft the competition for space is hotting up. “The market continues to polarise and there is activity where landlords have created - or are investing to create - a suitable standard of office space with the right environment and amenities. Secondary locations or where landlords have not yet invested will continue to struggle. "We are seeing better occupancy levels across the sector with businesses using flexible workplace strategies but with an increased focus on staff being in the office. Businesses remain focused on creating a better environment to achieve corporate goals, retain and attract staff and to future proof their occupational assets.”

Indoor golf bar Pitch latest to target Birmingham

Another competitive socialising venue has announced plans to open in Birmingham. London-based group Pitch will launch an indoor golf bar in 2 Colmore Square in April, becoming the firm's first venue in the Midlands. The new destination will have eight simulator bays which will give customers the chance to "play” on some of the world's best-known courses. There will also be a bar, food menu, premium space for members and their guests, professional coaches on hand to offer tips and an academy aimed at encouraging women to get into the sport. Pitch will join a growing trend of activity-themed bars to open in Birmingham city centre in recent years, including F1 Arcade at Paradise and its sister venue Flight Club in Temple Street. Other brands to have tapped into the trend include Toca Social football in the Bullring and Clays laser shooting in New Street, both of which opened last year. Pitch co-founder and chief executive Elliot Godfrey said: "With a rich history and large contingent of modern, forward-thinking residents, Birmingham was an obvious choice to open one of our first venues outside of London and we're very much looking forward to bringing Pitch to the city." Co-founder Chris Ingham added: "We're thrilled to have secured a location right in the heart of the action, with a huge choice of transport links, accommodation, restaurants and bars a short walk away in every direction." Pitch has other venues in London, Dublin and Manchester and the move into 2 Colmore Square follows the recent news it is undergoing a revamp. The building and its adjoining neighbour Cannon House, in The Priory Queensway, are being given a facelift and rebrand to become 'Multistory'. The new-look, eight-storey building will have 75,000 sq ft of new grade A office space and a further 15,000 sq ft of amenity space for tenants.

Former Newcastle Sports Direct store to become new home for banking giant

Lloyds Bank is to move into the multimillion-pound redevelopment of the former Sports Direct store at Monument Mall, it has been revealed. Billionaire real estate entrepreneurs Reuben Brothers, part owners of Newcastle United, snapped up Monument Mall in a reported £37m deal four years ago through its investment vehicle, a deal which triggered major investment at the large property which has luxury shops, bars and restaurants. Former tenant Sports Direct moved out of its Northumberland Street building to set up shop across the street, and hoardings have surrounded the former sports shop for a number of months while a construction team strips back the property – previously home to retailers including Burtons and Woolworths – to create new commercial units for new tenants. Now it has emerged that Lloyds Banking Group is poised to quit its Grade II star listed base on Grey Street to move its city centre branch into Monument Mall. Work on a fit-out is set to take a number of months, with Lloyds taking over the ground and first floors, but the banking group says its hopes to move into its new city centre base in the second half of this year. The firm said the new branch will be based within the ground floor of its new office in the Monument Mall building, providing a more modern, accessible space for both our colleagues and customers. It added: “We will terminate our existing lease once all colleagues have been relocated. There are no role reductions as a result of this announcement.” Staff at the bank’s Newcastle branch were told of the planned move at the end of last year, through an announcement saying: “We’ve been looking at some of our regional offices to understand how they’re being used and how this aligns to our strategy to create fewer, better equipped offices to suit the future of our business. This is about having the right facilities, technology and environment for our people, designed for inclusivity, accessibility and sustainability. We’re investing in our branches too. While the shape of our branch network is changing in line with customer behaviours, we’ll continue to invest In our branches to ensure great customer and colleague experiences. “Taking these factors into consideration, we’ve decided to relocate our branch and our regional office from 102 Grey Street to Monument Mall in H2 2025. The new Lloyds branch and office will be a significant upgrade on our current space and will have a whole now look and feel. We’ve secured a prime retail spot in this building which reflects how customers are banking with us now.” The new branch is set include innovative new features including ‘touch down spaces’, greater technology-led experiences, a new kitchenette and breakout spaces. Sharon Doherty, chief people and places officer at Lloyds Banking Group, said: “We’re thrilled to be moving to Monument Mall in Newcastle. This new location provides our people with modern, state-of-the-art facilities, creating the ideal environment for our colleagues to collaborate and thrive. Newcastle joins our other hubs, including Cardiff, Birmingham, Leeds, London, Belfast, Edinburgh, and Manchester, benefiting from the significant investment we’re making to transform our workplaces for colleagues and to attract the talent of the future.”

Revamp for Jewellery Quarter office block

An office block in Birmingham has undergone a renovation project. The facelift work at the Jewellery Business Centre, in the historic Jewellery Quarter district, includes new breakout space for collaboration and relaxation and a refreshed reception area. There is also a new dedicated postal room, redecorated corridors, new signage and other work to the building's décor. Email newsletters BusinessLive is your home for business news from across the West Midlands including Birmingham, the Black Country, Solihull, Coventry and Staffordshire. Click through here to sign up for our email newsletter and also view the broad range of other bulletins we offer including weekly sector-specific updates. We will also send out 'Breaking News' emails for any stories which must be seen right away. LinkedIn For all the latest stories, views and polls, follow our BusinessLive West Midlands LinkedIn page here. Landlord Northern Trust Company carried out the project in Spencer Street in collaboration with Rota Contracting and Poppy Signs. Business centre manager Lisa Whitcombe said: "Northern Trust is dedicated to creating high-quality workspaces that meet the evolving needs of our occupiers. "These improvements reflect our ongoing investment in the Jewellery Business Centre and underline our commitment to supporting businesses in Birmingham's Jewellery Quarter." The building has flexible space able to accommodate single occupiers up to small businesses.

32-storey Sky Gardens residential tower to dominate Leeds after £54.4m loan deal

A Grade II-listed former mill in Leeds is set to be transformed into a vibrant residential destination with a 32-storey housing tower following a £54.4m loan deal. Real estate finance provider Maslow Capital has provided the multimillion-pound development loan to back a joint venture between CityLife and Torsion Group, which is set to develop the landmark Sky Gardens scheme in the city. A brownfield site which is just under one acre in size will be turned into Sky Gardens, a huge build-to-sell scheme with 306 homes set across the 32-storey skyscraper – which is set to become one of Leeds’ tallest buildings – and a three-storey refurbished former mill. Once finished, apartments will range from studios to three-bedroom homes to cater for different residents, and the project will also include a number of “premium” on-site facilities including a gym, a cinema room, a luxury residents reception lounge, and the ‘Sky Garden’ – a stunning rooftop area with 360 degree views across the city from the top floor. The development will also include two commercial units. The development team says it is working to preserve and sensitively restore the Grade II-listed mill and integrate it into the wider design, as part of a block housing 22 residential units. The developers say Sky Gardens, set on Water Lane in Leeds’ South Bank regeneration area, embodies Leeds’ ambitious spirit. Gareth Morgan, managing director at CityLife, said: “Leeds has always been a city of ambition and reinvention, and Sky Gardens embodies this spirit. This project allows us to preserve an extraordinary piece of our industrial history while offering modern, sustainable living that meets the needs of today’s residents.” Matt Pigram, senior director, origination at Maslow Capital, said: “CityLife and Torsion Group bring extensive expertise to this project, and we are confident their combined vision will drive the scheme’s success. This £54.4m facility deepens our partnership with both developers, bringing our total support to a combined 896 homes across three major Leeds projects—an effort that underscores our commitment to addressing the region’s ever-growing need for high-quality housing.” David Worsley, COO at Torsion Group, said: “We are delighted to continue our longstanding relationship with Maslow Capital with this being our third transaction following the successful completion The Phoenix and Flax place. Torsion Group is proud to be part of this joint venture, bringing together a highly experienced delivery team including investment, construction and development management expertise. “In partnership with CityLife, we are fully committed to providing Leeds with a best-in-class development which is designed and constructed with placemaking and ESG at the heart of the concept.”

Harworth reports record 2024 on path to £1bn assets

Property firm Harworth says it is on track to accumulate £1bn in assets by the end of 2027 after what it described as a record year. The Yorkshire-based developer and landlord says that as key land sales complete, it is confident of meeting its target of £1bn European Real Estate Association Net Disposal Value (EPRA NDV) - a key measure of assets used by real estate investment trusts. In a trading update to the London Stock Exchange, Harworth pointed to its £106.6m deal with Microsoft for land at the site of the former Skelton Grange power station near Leeds and completion of a £53.5m sale at Ansty in Warwickshire. Bosses also pointed to a record 2,385 residential plots sold, including 13 deals with a headline sales value of £104.1m, and against a group target of 2,000 plot sales on average per year. Those deals included national and regional housebuilders and affordable housing providers. Meanwhile there was 4.4m sqft of industrial and logistics land sold for £230.1m, giving Harworth a pipeline capable of delivering 33.6m sqft of space. Following a spate of planning approvals, the group now has 8.4m sqft of industrial and logistics land with consents. During the year 100,000 sqft of direct development was completed and Harworth was on site at the year end with another 270,000 sqft of space which is expected to be completed within a year that is anticipated to bring £2.7m annualised rental income. The majority of the space (68%) was kept in the group's investment portfolio with the remainder built for owner occupiers. Lynda Shillaw, chief executive of Harworth, said: “2024 has been a record year for Harworth operationally and, as we enter 2025, we remain confident in our ability to reach our £1bn EPRA NDV target by the end of 2027. "We have an extensive platform to scale the business, owning and controlling a sizeable land pipeline capable of delivering 33.6m sqft of industrial and logistics space and 31,264 new homes, and we remain well positioned in structurally undersupplied sectors that are fundamental to the UK's economic growth. With low debt and high available liquidity, we are well placed to take advantage of opportunities whilst remaining resilient through the near-term macro-economic uncertainty. "The consistency of Harworth's performance over time continues to highlight the agility and resilient nature of our business model, and our team's expertise in identifying and driving significant latent value from the portfolio. We continue to make solid progress in delivering our strategy and are confident in our ability to continue to drive both strong returns and long-term value from our landbank and development activities."

Empty office block could be demolished for 140 new homes

An unused office block in Oldham that council officials fear could be a magnet for 'vandalism and anti-social behaviour' is set for demolition to make way for 140 new homes. The demolition of the Southlink building, near Oldham Mumps, was reconfirmed at a cabinet meeting this week. The land, acquired by Vistry Partnership from both the council and Transport for Greater Manchester in the previous October, will be transformed into a residential area featuring 146 affordable houses. This includes 32 for social rent and 77 priced at 80% of market value, reports the Manchester Evening News. Although demolition had been previously approved, progress had paused following an unsuccessful sale attempt to Tilia Homes. Oldham's cabinet member for 'decent homes', Elaine Taylor, commented: "The demolition will enable the site to be readied for construction and remove a vacant building which is likely to attract vandalism and anti-social behaviour, especially at night and weekends which will inevitably cost the council additional money to keep the building safe and secure." The council has stated that the development plan focuses on '100 per cent low carbon homes', equipping them with heat pumps and insulation aimed at preventing heat loss and energy saving, ultimately reducing household bills for occupants. Council leader Arooj Shah hailed the upcoming development as a significant victory amid Oldham Council's housing crisis, with over 7,000 locals on the social housing waitlist. Cllr Shah said: "The green element is also really significant, but when you bring that down to people, that also means they'll have cheaper energy bills. It's a win-win. I'm hoping this will just be the start of so many other developments that are economically viable [for our residents]." A planning application is anticipated by spring, at which point the public will be invited to provide their feedback on the proposals.

Bristol office market has highest rents outside London

Office space in Bristol is now more expensive than any other big city outside of London, a new report has revealed. Surging demand among businesses and a lack of supply drove up rents last year, the Bristol Office Agents Society found. Headline rents in the city increased through 2024 to £48 per sq ft - the highest of the big six cities analysed. A lack of "good quality" space also drove up prices on refurbished buildings which in many instances achieved rents of £40 per sq ft. Though take up of space was below the five and 10 year averages for the year, there was an increase on the level for 2023 and with strong demand towards the end of the year market sentiment going into 2025 is positive, the report said. Bristol’s city centre market saw 41 deals completed in the second half of last year with a H2 take up of 187,527 sq ft. Total annual take up in the city centre for 2024 was 440,562 sq ft. Among the biggest deals was BLOCK’s acquisition of 21,235 sq ft at the newly refurbished building The Fairfax. There were also agreements at UBS’s newly refurbished 3 Rivergate, with Aecom’s taking 15,124 sq ft on the sixth and part of the fifth floors, and DNV taking 11,261 sq ft on the fourth. Other Grade A lettings this quarter include CBREIM’s letting at Halo of 9,504 sq ft to Softcat; Mazar’s move to 7,821 sq ft at AXA / Bell Hammers Assembly C; and CBRE acquiring 7,309 sq ft of space for themselves at CEG’s EQ. Several new build schemes also completed in Bristol last year, including CEG’s EQ, Trammell Crow and Tristan Capitals’ Welcome Building, and AXA / Bell Hammer’s Assembly Buildings B & C, all of which secured pre-lets. Beyond these there are no other new developments under construction. The only major works ongoing are comprehensive refurbishment schemes including APAM’s One Friary, CEG’s Crescent and Abrdn’s Queens Quay. Andy Smith, office agency partner at Knight Frank, said: “An election year always has a negative impact on levels of take up as businesses often put moves on hold due to the uncertainty surrounding a new government and 2024 was no different. "However, even in this challenging market there were a number of significant deals, and occupiers continued flight to quality saw rents rise." He added: "As we start 2025 there has been a marked uptick in new enquiries both in and out of town which reflects an underlying improvement in occupier sentiment and a slightly less uncertain political and economic outlook for the year.” Meanwhile, the Bristol out-of-town market saw 13 deals cross the line through the second half of the year to give a H2 take up of 54,773 sq ft. The largest of these was the long leasehold of 13,075sq ft at 23 Clothier Road to Outcomes First Group. The figure was below the five and 10 year averages but the outlook for 2025 is "more positive", the Bristol Office Agents Society said. Chair of the South West OAS, and Lambert Smith Hampton’s office agency director Roxine Foster, added: “2024 proved to be a year of mixed fortunes, however the outlook for 2025 is positive and with pressure on supply becoming more and more evident it will be interesting to see which the next schemes are to start on site."