A Liverpool council report says that the city’s gay quarter should be officially recognised.

A £12,000 consultation ended in May after the area’s residents, businesses and visitors were asked how the area could be improved.

Councillors will consider the report next week, which says the city could reap economic benefits by turning the Stanley Street area into a world-class gay destination.

Recommendations include a gay hotel, bars and shops to appeal to a wider gay market, a new public square and the creation of a community trust.

Labour Councillor Nick Small, who represents the Central ward, said “Other cities such as Brighton, Manchester and Birmingham have reaped the economic benefits of similar quarters and Stanley Street has the potential to more than match them.

“Stanley Street is a vibrant area but it has nowhere near reached its full potential. The proposals set out in this report have many interesting and original ideas about how its appeal can be extended and how it can be prompted.

“We now need to look at what is achievable and how best we can go about that. What is important is that we have the support of the various interests in the area about how we go forward.”

Until last year, Liverpool was the only major UK city not to have an annual Pride event, other than LGBT arts festival Homotopia.

The second Pride celebration is to take place tomorrow.