Comments : Merseytravel move its HQ into new waterfront offices
Merseytravel's original Head Quarters were in Hatton Garden until a review took place in 2007 and found it was not fit for purpose anymore. In February 2012, Merseytravel moved to Mann Island, the new office blocks on the Liverpool Waterfront.
This move has come under scrutiny because John West, the canned fish company were occupying the building until Merseytravel offered them a £1million incentive to relocate.
John West has agreed to rent a floor off Merseytravel in Mann Island for £19.50 per sq ft, even though it is costing Merseytravel £20.50 per sq ft. This means that Merseytravel are making a loss and a former Liverpool Council Leader made a commented on this strange set up and said, ‘This is the economics of the madhouse. You don’t need a degree in accountancy to realise that this just does not add up.’
John West have agreed to lease one floor in Mann Island for an annual rent of £212,500 for 15 years however, they will not have to pay rent for the first two years and nine months. They will also receive a cash payment worth almost half a million pounds from Merseytravel for its interior design. This equates to an equivalent of almost a five year rent free period, worth £1 million.
John West also has an office in Tithebarn Street and can break the 15 year contract with Merseytravel after 10 years but will pay a fine of six months rent.
Merseytravel are paying a total of £2.86million a year to rent the Mann Island office block, even though they are only occupying just over half of the building.
Merseytravel’s former offices in Hatton Garden did not cost any rent as they owned the building, now Merseytravel will pay a total of £85.8million for their new office next to the Three Graces over a 30 year period.
It is believed that the Northwest Development Agency is using tax payer’s money to pay for the three floors of the building for five years on behalf of Merseytravel.
Merseytravel’s move has been branded a ‘sweetener’ for John West so they can solely lease the Mann Island building. A Merseytravel spokesman defended this by announcing that, ‘Our professional commercial property advisors have no hesitation in recommending that we proceed with a transaction on the terms as currently proposed.’
Merseytravel are seeking for other tenants to rent the remaining empty offices in the building.
What do you make of Merseytravels move to lease Mann Island and rent the remaining empty offices?
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