Qatar has put its biggest single investment in London on hold, citingconcerns about the British economy.
The gas and oil-rich state has placed the £3bn Chelsea Barrackshousing development under review and a source close to the project said that while it could still go ahead, one option was to sell the "super-prime" site without building what has been dubbed a "Gucci ghetto" of 450 luxurious residences and 123 affordable homes.
Qatari Diar, the emirate's property arm, has secured planning permission for the scheme, which includes seven-bedroom mansions as well as one-bedroom flats. But today the £1bn site stands empty with weeds growing through the concrete.
"It now seems a huge gamble to deliver all of this," a Qatari source told the Guardian. "They [the developers] will take their time and see how the numbers stack up in due course." He added that while the scheme could still be built, "they could sell [the site] any time".
The rethink of the Qataris' flagship project comes as the latest UK economic data showed Britain heading for a triple-dip recession. Qatar is now the richest country in the world per capita and already owns 80% ofthe Shard, the tallest building in western Europe, all of Harrods, the US embassy in Mayfair and is joint owner of the Olympic Village and the Shell Centre on the South Bank.
But no office lettings have yet been announced in the Shard, and concerns about the future appetite for luxury homes in London mean the risk of pouring a further £2bn into construction in a stagnant economy has caused concern in Doha. Britain's economic data has also compounded fears that the emirate over-paid when it gave the Ministry of Defence (MoD) £959m for the site in 2007.
"The strategy is under review," confirmed a Qatari Diar spokeswoman. "The developer is currently refining its strategy for the development of this unique site to progress and realise its vision for this important part of London.
"It 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," she said.
Qatar's wariness also stems from its reluctance to cause further controversy in the UK, the Guardian understands. Qatar's purchase of the site in the oligarchs' playgrounds of Belgravia and Chelsea was made for geopolitical gain as well diversifying its wealth – Qatar has said it is part of a strategy of using property investments to "redefine Qatar" and "create a sphere of influence in London".
But when Qatar published its original designs by the modernist architectRichard Rogers in 2009, Prince Charles personally wrote to the prime minister of Qatar, Sheikh Hamad bin Jassim bin Jabor Al Thani, complaining the scheme seemed part of a "gigantic experiment with the very soul of this city" carried out by "brutalists". He urged Qatar instead to "bequeath a unique and enduring legacy to London" and the letter was published as part of a bruising high court battle that was uncomfortably high profile for the secretive emirate.
With the replacement designs remaining controversial and Qatar counting Britain as an important ally in the politically and militarily volatile Gulf, Doha does not want to cause further problems with powerful neighbours, the Qatari source said.
The decision to put the scheme on hold is seen as so sensitive that it has not been communicated to key consultants on the project. Architects commissioned to draw up the masterplan, including the designers of the Royal Opera House, Dixon Jones, have not received instructions for over a year and Westminster city council, which granted planning consent in the summer of 2011, has been kept in the dark.
Local and national politicians had hoped the development would help alleviate London's acute shortage of affordable housing. When the site was being sold by the MoD, the then communities minister, Lady Andrews, said affordable housing units would contribute to solving "the enormous housing stresses in London". If the scheme were to be built, the Qataris would be also due to contribute £78m to Westminster city council's housing fund.
This week the site was a scene of desolation. Instead of bustling construction, buddleia sprouts from broken concrete and guard dogs prowl behind barbed wire-topped hoardings.
"I'm not sure anyone outside the Gulf knows [what is going on]," said a consultant working on the scheme. "When I ask the guys from Qatari Diar [in London], they just shrug their shoulders. It received outline consent in late 2011 and some work was done moving things forward with detailed designs. Those designs were sent to Doha and that was it.
"They paid about £1bn for the site and maybe that was just pin money to them. It doesn't make sense to me. I look at what is on offer at Chelsea and I think people would snap it up."
A source who was until recently working on the project said: "It's odd they are not doing anything because the residential markets are really rolling right now."
Located in what estate agents call the "super-prime" SW1 postcode area of west London, many of the flats would sell for more than £10m, a price bracket that has seen a 40% rise in prices from the market upturn in March 2009 to June 2012, according to data from the estate agents Knight Frank. The number of sales in SW1 rose by 29% between 2011 and 2012.
The Chelsea Barracks site is located in a very wealthy area that has been largely insulated from economic decline. Luxury cars, such as Ferraris with Swiss number plates, cruise past exclusive furniture boutiques such as Linley, which is owned by the Queen's nephew, and Michelin-starred restaurants.
In the last two years a third of properties sold in the SW1 area were purchased by British citizens, while 34% were bought by people from Russia, former Soviet republics and the Middle East.
The lack of activity has been a mixed blessing for local opponents of the project, with some delighted that there is no building happening and others concerned at the uncertainty.
"We are selling London out to the Qataris and they are not coming up with the goods," said Georgina Thorburn, chairwoman of the Chelsea Barracks Action Group, a local group alliance opposed to the plans. "A lot of local people have been very stressed out by this project, particularly the older residents, who worry about the impact on their lives.
"I am not talking about the rich, but people who have been in the area a long time. They are the ones who want news."
No comments:
Post a Comment