It might be called the “Helter Skelter” but the construction of the £800m skyscraper Pinnacle is anything but fast and furious. Work on the future tallest building in the Square Mile has halted for the second time in six months because of its failure to attract pre-let tenants.
The developers, Arab Investors, have failed to sign up any major tenants to occupy the tower, with only circa 10 per cent of the (eventual) 900,000 square feet of space having been let so far.
Work on the Pinnacle had previously halted last autumn but started again when HSBC was appointed to secure the next stage of funding.
Back in September, we charted the progress of the stars on London’s skyline and revealed how the Shard, 20 Fenchurch Street (Walkie-Talkie), 122 Leadenhall Street (Cheesegrater) and the Bishopsgate Tower were struggling to attract tenants.
Not much has changed since then. All the buildings are at varying degrees of completion but have reportedly signed only one office rental deal between them.
As for the Pinnacle, in September Dan Bayley, MD of central London for BNP Paribas Real Estate, told us the reason why the tower is a problem-child skyscraper is because of “a huge credibility gap”.
Bayley said: “No one really knows what’s going on with it. You’d find many a press release and comment about how great the Pinnacle will be. But you won’t find it as an option in the radar of tenants, simply because they see there’s no progress in terms of construction.”
A recent report by Barclays Capital warned of an “unhealthy correlation” between the skyscrapers being built and recessions following swiftly afterwards.
“Often the world’s tallest buildings are simply the edifice of a broader skyscraper building boom, reflecting a widespread misallocation of capital and an impending economic correction,” Barclays Capital analysts said.
The findings might be a concern for Londoners, who are currently seeing the construction of what will be Western Europe’s tallest building, the Shard.
Will there will be a day that these skyscrapers will stand tall on London’s grounds? Leave your comments below and let us know what you think..
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