Saudi mile-high tower shelved for now

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Saudi Arabia's tallest tower is the latest project to be put on hold due to the credit crunch.

Saudi Arabia’s Kingdom Holding Company (KHC) has shelved plans for the world’s tallest tower due to the financial crisis.

The Kingdom Tower was officially launched in October and standing at over 1km was expected to be the centrepiece of the US $26.7 billion (SAR100 billion) Kingdom City near Jeddah.

But sources close to the project say the tower is now on hold after KHC suffered losses of $8.3 billion in the fourth quarter of 2008 due to the downturn in equity markets.

"The developer has chosen not to pursue the tower project in the short term, and it does not feel it has to," said a source.

"It is not going to be the starting point to the Jeddah project as originally envisaged."

The source also said that the tower had been deferred for an undetermined period of time and that project manager Bechtel had ended its involvement with the development.

"Kingdom Tower is the type of project you do in a better economic climate. It would be conjecture to suggest when it could possibly be moved forward," he told UAE-based weekly Meed.

The news follows similar moratoriums on Dubai's tallest tower project - the 1km Nakheel Tower and Harbour, the 415m Chicago Spire, and Moscow's 612m Russia Tower.

KHC's Kingdom City will cover an area of 7.1km² with a built up area of 23 million m² comprised of commercial, residential, institutional, educational, entertainment, retail and hotel facilities.

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