Qatar has put its largest single investment in London, the GBP£3bn (US$4.7bn) Chelsea Barracks housing development, on hold, citing concerns about the UK economy.
A spokesperson for Qatari Diar, the property investment arm of Qatar’s sovereign wealth fund, confirmed the project, which Prince Charles lobbied to be built in his preferred architectural style, was under review.
“The strategy is under review,” a Qatari Diar spokeswoman told the UK's The Guardian.
“[The developer] is taking advantage of the opportunity to review and respond to the context of the prevailing economic environment in preparing for the next stage of the development,” they added.
Qatar, which owns a string of property assets in London, including 80 percent of Western Europe’s tallest building, The Shard, Harrods and the US embassy, won approval for the 13-acre site in the summer of 2011 but work on the project has not progressed.
The gas and oil-rich state was forced to scrap a modernist scheme designed by Lord Rogers following intervention by Prince Charles. The heir to the throne personally wrote to the prime minister of Qatar, Sheikh Hamad bin Jassim bin Jaber al-Thani, urging the Gulf state to “bequeath a unique and enduring legacy to London”.
Lord Rogers was fired and new plans were endorsed by royal aids.
A source told The Guardian that while the project, which was to include 450 luxurious residences and 123 affordable homes, could still be built, “they could sell [the site] any time”.
“[The developer] will take their time and see how the numbers stack up in due course,” the source added.
The news follows days after the UK’s Office for National Statistics released figures that showed the economy shrank 0.3 percent in the last three months of 2012, putting the country on course for its third recession in four years. The figures were worse than expected.
Qatar’s concerns about the British economy have been compounded by the lack of demand for office space in The Shard. The owners have yet to confirm any corporate residence lettings in the building’s 575,000 sqft of office space.