Council paying £63m more than office blocks worth

A council is set to pay about £63m over the value of two office blocks it had built.

Wirral Council opened the Mallory and Irvine buildings in Birkenhead in 2023, and committed to a 35-year lease on them at a cost of £75m.

But they have been valued at just £13.2m.

The £63m figure is more than double the amount of the gap in the local authority's budget for this year.

The two office blocks were funded by insurance company Canada Life Ltd.

Mallory is partly occupied by the council, while Irvine remains empty, the Local Democracy Reporting Service said.

The lack of any rental income has added to the financial burden on the authority, which is obligated to pay back 550% of what the buildings are worth.

Auditors Grant Thornton identified the "impairment loss", which is when something costs more than its value.

But the accountants said the value could increase if other tenants were found.

In response to the auditors' report - which was also critical of plans to move Birkenhead market into a former Argos -interim chief executive Matt Bennett said the council would be "implementing [recommendations] to strengthen the financial controls and governance arrangements in place".

He added: "The Council recognises the scale of the financial challenges that it faces and the requirement for transformational change in the way that it delivers services to ensure its long term financial sustainability."

Wirral Council has until March to close its £30m funding gap, or it could potentially have its main functions taken over by government commissioners.

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