Credit crunch threatens two major tower schemes
The future of two multi-million pound tower projects is hanging in the balance as a result of the UK’s worsening credit crunch.
Developer the Mersey Property Company (MPC) has withdrawn plans to build a £100 million 32-storey RMJM-designed tower on Liverpool’s waterfront after it failed to secure funding.
Meanwhile, construction of a £240 million residential tower in Birmingham’s Snow Hill by Glenn Howells – which had been set to be the city’s tallest building - is set to be significantly delayed after a review of timings by developer Ballymore.
The news comes just a month after two Ian Simpson tower projects in Leeds – Criterion Place and the Lumiere scheme were scrapped and mothballed respectively.
David Porter, partner at Knight Frank Manchester, which advised MPC not to purchase the Liverpool Princes Dock site from Peel Holdings in order to build RMJM’s mixed-use tower, confirmed funding problems were the root cause.
“The deal was always subject to planning and funding,” he said. “Planning was obtained but, based on the current slowdown in both the residential and commercial markets, funding has not been obtained and that is the main reason the deal [with Peel Holdings] is not going forward.”
However, RMJM insisted it is not giving up on the scheme.
“We are currently in negotiation with a number of local stakeholders about the Princes Dock project in order to achieve a positive outcome for the development,” RMJM managing director for Europe Hugh Mullan said.
In Birmingham, a spokeswoman for Glenn Howells Architects also reacted bullishly, claiming it was looking forward to working on the proposed tower scheme – part of the wider £500 million Snow Hill development – in the “near future”.
The Glenn Howells building, which is 140m-tall and includes 332 apartments, is part of the third phase of the scheme alongside the city’s first five star hotel.
Birmingham City Council refused to comment on potential delays on the site but insisted the overall regeneration of Birmingham’s city centre would be relatively unscathed by the country’s worsening economic situation.
“The regeneration in Birmingham continues and a lot of it is funded by the council or foreign investment which is not as vulnerable to the problems affecting in the UK market,” a council spokesman said.