Hotel Solutions has been working with the Liverpool City Region Local Enterprise Partnership (formerly The Mersey Partnership), Liverpool Vision and Liverpool City Council since 2000 to assist them with attracting and managing hotel developer interest in Liverpool. This has included undertaking six Hotel Futures Studies for the city, most recently in 2014. Following on from this latest Hotel Futures Study we have produced the Liverpool Hotel Investment Strategy for the period 2016-2020, which we are now assisting the Local Enterprise Partnership and City Council with implementing.


The development of Liverpool’s hotel industry has been one of the city’s major successes and a key contributor to Liverpool’s rise as a leading national and international leisure and business tourism destination, alongside the development of the city’s cultural, attractions and retail offer and the opening of the Arena & Convention Centre Liverpool in 2008 and the new Exhibition Centre Liverpool in September 2015. Liverpool’s hotel supply increased by 120% between 2005 and 2015, with the opening of 49 new hotels and serviced apartment operations and an additional 4,233 hotel bedrooms and serviced apartments.  The city’s hotel supply has expended further in 2016, with the opening of the 4 star Pullman Hotel at the new Exhibition Centre Liverpool (216 bedrooms) and an Easyhotel budget hotel in Castle Street (77 bedrooms). Liverpool has seen the emergence of new hotel products in terms of the rapid growth of boutique hotels and serviced apartments and the introduction of budget boutique hotels and aparthotels, alongside almost a doubling of the city’s 4 star and budget hotel supply.


The 2014 Liverpool Hotel Futures Study forecasts significant potential for additional hotel supply in Liverpool city centre through to 2020 as a result of:


  • Continuing strong weekend demand, further boosted by weekend consumer shows at the new Exhibition Centre Liverpool;
  • Further growth in midweek leisure demand from the UK and overseas leisure tourist markets;
  • Significant growth in demand from conventions at the BT Convention Centre as it wins more, larger and longer international and corporate conventions;
  • A significant boost to midweek demand from trade exhibitions at the new Exhibition Centre Liverpool;
  • Growth in contractor demand;
  • Some growth in corporate demand and residential conference business.


The hotel demand projections prepared as part of the Hotel Futures Study (updated in September 2015) suggest that in addition to the 2 hotels opening in 2016, the growth in Liverpool’s hotel market could require the development of between 250 and 1,100 new hotel rooms between 2016 and 2020, equating to between 2 and 8 additional new hotels. Room rates remain a key issue in Liverpool however: they are not currently at a level that will support commercially viable upscale hotel development, without some form of public sector subsidy or intervention. BPRA, which has been used to fund most of the new hotels that have opened in Liverpool city centre since 2011, will no longer be available after 2017. Rate growth is thus a clear priority to improve hotel profitability and ensure sustainable hotel development going forward. This will require new hotel development to be suitably paced to ensure that hotel supply increases in line with market growth and not ahead of it, which could result in oversupply.


The new 4 star and boutique hotels that have opened in Liverpool city centre in 2014 and 2015, together with the new Pullman hotel at Exhibition Centre Liverpool, should be largely sufficient to meet the requirements for additional supply at this level through to 2020, after which market growth is likely to support additional upscale supply. The greater requirement for the next 5 years is for additional midmarket and budget hotels (for which there are currently few proposals) and serviced apartments/aparthotels.  This reflects the fact that much of the market growth will be in the more price-sensitive leisure and trade exhibitor markets. The priority will be to develop a more distinctive midmarket and budget hotel offer in terms of attracting some of the new, innovative hotel products and brands that are emerging at these levels that can add greater choice and attract new markets.


The 2014 Hotel Futures Study clearly identifies the Waterfront and adjoining areas, including Kings Dock, The Strand and Historic Downtown, as the priority locations for hotel development, certainly for the period 2016-2020. ACC Liverpool and EC Liverpool will be key drivers of hotel growth in the city and will need to be supported by additional hotel supply within easy walking distance. The Waterfront is also likely to be the location of choice for the growing number of leisure tourists that will be coming to the city.


Other growth locations that provide potential to deliver new demand for hotel accommodation are:


  • The Lime Street Area, where new hotels can service visitors arriving by train, new leisure tourist demand as the St George’s Quarter develops as a focus of visitor activity, and new corporate and university demand arising from the development of the Knowledge Quarter;
  • Hope Street, as a proven location for boutique hotels;
  • Ropewalks as a potential location for small aparthotels and boutique hotels;
  • Princes Dock, where new offices are planned alongside a new, larger cruise terminal, both of which will generate increased demand for hotel stays;
  • In the longer term Liverpool Waters as a strong corporate hotel market develops here.


Hotel Solutions is now working with Liverpool City Region LEP and Liverpool City Council to promote the Hotel Investment Strategy to the city’s property development community and national and international hotel companies that are interested in investing in new hotels in Liverpool.