Monday, 28 September 2009

U2 tower faces major new delays

The consortium that won the rights to develop the U2 tower in Dublin's south docks does not expect the Dublin Docklands Development Authority (DDDA) to move forward with the project for the foreseeable future. Informed sources say the consortium - which comprises Sean Mulryan's Ballymore Group, developer and retailer Paddy McKillen and U2 themselves – intends to continue as preferred bidder however.

The consortium initially bid about €100m for the site, but the deal was never signed and the land's value has plummeted since.

The DDDA announced last year that negotiations on the future of the tower will not recommence until next month to allow for an "improvement in the current uncertainty surrounding the property and financial markets".

The property market has fallen further since then and the site is derelict.

The DDDA has held back on publishing its accounts, which are expected to show huge drops in the value of land its owns.

Meanwhile, Mulryan's Ballymore Group has moved a step forward in its bid to sell land it owns at Nine Elms in London to the US government for use as an embassy. The deal is dependent on the £500m (€555m) project securing planning approval from the relevant local authorities and Wandsworth Borough recently recommended outline planning be granted on the five-acre site.

The new embassy will be between 15 and 20 storeys high and the consent is subject to the US embassy agreeing a contribution towards the new Crossrail train line or towards the extension of the underground Northern line from Kennington. That extension is set to terminate close to the Battersea Power Station, which Treasury Holdings' controlled Real Estate Opportunities is planning to redevelop.

The US embassy hopes to be able to move in to its new embassy in 2016. It is currently in a row with the British Treasury over whether it should have to pay £50m in VAT towards the project.

Sunday Tribune

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