Specialist property lender Leumi UK has arranged a £21.45 million financing deal with Forma Real Estate Fund (“Forma”) to finance a 136,000 sq ft grade A office asset in the central business district of Liverpool.
The funds will enable Forma to part finance the acquisition of the highly specified, flexible office at 5 St Pauls Square as well as support Forma with its plans to upgrade the asset and deliver high quality amenity rich space for the occupiers.
St Pauls Square is situated in the heart of Liverpool’s city centre and is the premier commercial location, amidst the city’s thriving business district. Current tenants include law firm DWF LLP and shipping specialists Denholm Logistics. Other nearby occupiers include Hill Dickinson, Sony, Keoghs LLP and BT.
The Liverpool market has been in need of new and improved office space with the local market characterised by a chronic lack of high quality supply over the last 10 years, despite being at the centre of the UK’s second largest regional economy. Around 20% of Liverpool’s total office stock is thought to be grade C/D, with no new grade A stock coming into the market in the near future. Forma’s strategy of ESG-led repositioning of the property will be welcomed by the city’s workforce, who are left with few options but to sit in tired buildings.
Chris Stallard, relationship director at Leumi UK, said: “We’ve seen a marked increase in demand for premium office space over the past year with 91 percent of year-to-date take-up being of Grade A quality. Liverpool is a vibrant metropolis which contains a young and highly skilled workforce from its four universities. Therefore it’s paramount that the city can meet the needs of its professional workforce with high-quality office space that achieves long-term sustainability goals. Leumi UK has long been guided by a ‘customer first’ principle and we hope this deal will deepen our relationship with Forma.”
Chris Taylor, UK CEO of Forma, said: “We continue to progress our strategy of investing in high quality offices in regional central business districts where active asset management strategies and inward investment into the physical real estate can drive out-performance. Liverpool is a promising city for repositioning existing assets to deliver best in class office space. With the development pipeline constrained by high build costs we are delighted to acquire 5 St Pauls where we can align our ESG investment plans with increasing tenant demand for best in class grade A stock in Liverpool’s city centre. Leumi’s specialist knowledge of the office sector was instrumental in agreeing the funding for our ambitious plans and we look forward to continuing and growing our partnership.”
