Liverpool State House, 22 Dale Street, Liverpool, Merseyside

Description

Comprising a 92 room hotel, 6 commercial units, 6 floors of offices and a vacant basement car park. Potential for alternative uses or redevelopment of the offices, including residential, subject to consents. Vibrant city centre location close to the Cavern Quarter at the heart of Liverpool's nightlife district. Total GIA of 7,828 sq m (84,259 sq ft). VAT is not applicable.

Accommodation

92 room hotel, 6 commercial units, 6 floors of offices and a vacant basement car park; total GIA 7,828 sq m (84,259 sq ft); approximately 37,642 sq ft vacant

Location

Liverpool is a maritime city in North West England and a popular tourist destination. Dale Street connects Liverpool's waterfront at The Strand with Byrom Street, Lime Street and an entrance to the Queensway Tunnel. Moorfields Station is 125m to the northeast, Liverpool Lime Street is 700m to the east, and the property is situated on the south side of Dale Street at its intersection with North John Street. Nearby occupiers include Marriott, Dishoom, The Ivy, Premier Inn, San Carlo, Piccolino, The Cavern Club, Slug & Lettuce and Tesco Express.

Tenure / Property Information

Investment Analysis

The £2.5m+ guide is materially below the only supplied completed sale, State House, at £5.0m in July 2017; however, that comparable is the same property but is historic and no current valuation, income schedule, rent evidence or yield evidence is supplied. The property is a substantial partially occupied mixed-use freehold asset, with approximately 37,642 sq ft vacant. The long lease to Scion Hotels runs to 2048 without breaks, while the lease covenant prevents other parts of the building being used as a hotel. Alternative office uses, including residential, are described as potential only and remain subject to consents. A current GDV or supported maximum bid cannot therefore be established.

Investment Snapshot

Strategy Recommendation

Treat as a specialist commercial acquisition opportunity requiring full legal, lease, planning, building-condition and income due diligence. Do not bid on a residential conversion or flip basis without evidenced consents, costs and a current valuation.

Works Required

No specific defects or refurbishment requirements are evidenced. Due diligence should focus on the vacant office accommodation and basement car park, with any reconfiguration, conversion or redevelopment requiring technical assessment, planning and other relevant consents. Existing hotel, retail and office areas should be assessed separately.

Rental & Market Context

Sold Comparables

The following completed sales were identified within approximately 5 miles:

Potential BRRR Position

A BRRR assessment cannot be completed reliably. The guide provides an entry indication, but no current GDV, refurbishment budget, rent, finance assumptions or verified income are supplied. Refinance potential is also affected by the long hotel lease, the restriction on additional hotel use and the vacant office and basement areas.

Buy-to-Let Analysis

A BTL yield cannot be established because no sufficiently specific rental evidence, passing rent, operating income or acquisition cost structure is supplied. The asset is a commercial mixed-use investment rather than evidenced standard residential buy-to-let stock. The existing hotel lease and vacant areas require separate income and covenant analysis.

Flip Analysis

A flip appraisal cannot be quantified. The only supplied sale was the same property at £5.0m in July 2017, which is not sufficient evidence of current resale value. No supported works budget, current GDV, selling allowance or consented redevelopment scheme is provided.

Investor Risks & Due Diligence

• Approximately 37,642 sq ft is vacant, including the basement car park.

• The hotel lease expires in 2048 with no breaks, limiting flexibility during the lease term.

• The lease covenant prevents other parts of the building being used as a hotel.

• Alternative uses, including residential conversion, are only potential and subject to consents.

• No sufficiently specific rent, passing-income or yield evidence is supplied.

• Buyer, administration and other third-party charges are not quantified in the supplied evidence.

• The only completed comparable is the same property sold in July 2017 and may not represent current value.

Recommendation

Treat as a specialist commercial acquisition opportunity requiring full legal, lease, planning, building-condition and income due diligence. Do not bid on a residential conversion or flip basis without evidenced consents, costs and a current valuation.

Strategy Rating

Analysis Confidence

The evidence identifies the asset, tenure, occupancy structure, lease restrictions, floor area and one historic completed sale, but omits current rent, operating income, valuation, condition, works costs, fees, planning status and sale-cost assumptions.