UK - British Land has postponed plans to build a gleaming 220m skyscraper in the City of London, as falling demand for office space underlines the downward spiral of the UK economy.
Although the UK is not yet officially in recession, its economy last week showed flat growth return for the second quarter of 2008, with the construction industry said to be hit hardest.
The Leadenhall tower, nicknamed ‘The Cheesegrater', was to be one of a cluster of new high-rise office developments said just a year ago to be visible evidence of London's position within the world's leading financial centres.
Market conditions have obviously deteriorated since then as has demand for office space, and British Land officials are predicting it could be some years before property demand improves so with rising costs of raw materials and debt financing the project is being set back a year.
Other projects approved and set for construction include the ‘Walkie-Talkie' and Deutsche Immobilien Fonds AG's (IOFA) 288m ‘Helter Skelter'.
Once complete, the cluster of new buildings - described as offering "offer long-term high quality office investment opportunities" will sit adjacent to the Thames and the 310m London Bridge Tower.
The 47-storey 612,00sq foot building - so-called because its design resembles the side view of a typical kitchen cheesegrater - was scheduled for completion in 2011.
Ground preparation work has already started but a drop in profits in the first quarter of 2008 has forced British Land to rethink its plans.
That said, the firm has reiterated the building will eventually be built, albeit timing is the issue.
"We are reviewing timing of construction and target completion in order to optimise cost and occupational demand, despite demolition and preparation work proceeding satisfactorily," the firm commented.