I wish people would stop these constant negative comments. This project has come too far, and too much time and money has been invested for it to suddenly fall apart. So there's a short delay before an official press release... big fucking deal. The Qatari government will fund the remaining 1/3rd. This project is peanuts to them. In the unlikely event they pull out, Pramerica or another investor will step in. Halibi has no choice but to sell up. He'll look like a total idiot if he doesn't. Demolition will continue as scheduled, basement works will start next summer, core and steelwork will be rising in early 2009. Let's have some confidence in this project.

Totally agree with Will.

Or, put another way, that's nearly £300m for each developer, when you take into account the rising build costs. What are the chances of them securing that amount of money by December? They've already had years to do this. Are you telling me they're going to suddenly secure over three-quarters of a billion pounds worth of funding in the next few months?

Please don't call me negative, I'm just trying to be realistic here... and I'd be genuinely surprised if this happened.

Everyone keeps insisting "Don't worry - it WILL happen". But from my perspective, it seems the developers have been climbing a mountain to get this project underway, they're not even halfway towards its summit, and time is rapidly running out.





:nuts:

well, as far as i remember that just quoted earlier post from wjfox2002 was from quite a while ago and some things have changed in the meantime but i have to agree that it still sounds like quite a radical change of heart to his latest post right above..

CLS Holdings Interim Report published on LSE website

Environmental initiatives

We are fully committed to the provision of environmentally safe and energy
efficient buildings. The Shard, for instance, is designed to incorporate a host
of environmental and energy saving features including a cooling radiator, an
externally ventilated cladding system and combined heat and power boilers that comply with latest sustainability proposals.

We are hoping to utilise a low energy screen at One Leicester Square to promote public awareness of environmental issues and have applied to Westminster Council for the appropriate permission.

The London Bridge Quarter Project

We have continued to work with our partners to progress the London Bridge
Quarter project which encompasses The Shard and New London Bridge House.
Operational progress has proceeded according to programme and we are ready to commence demolition works at The Shard. Negotiations in respect of the funding for the project are at an advanced stage but have, unfortunately, been affected by the recent adverse credit markets. It is hoped that the funding can be finalised in the near future in conjunction with a restructuring of the shareholding structure. We will not commence any major development works until the loan finance has been secured.

As at 30 June 2007, the adjusted net asset value of £613.3 million included £
59.0 million in respect of The Shard and New London Bridge House, equating to 83.6 pence or 9.6 per cent of overall adjusted NAV per share of 868.6 pence. The charge to Finance expense for the six months included £2.3 million
representing our one third share of interest expense charged to the project. We have to date invested cash of £10.5 million into the project from our own
resources and have not entered into any guarantees relating to London Bridge
Quarter.

During the first half of the year we have also been investigating the options for our Hoskyns House site in Vauxhall where the current occupational leases expire in 2009. The property currently comprises a series of low rise office and warehouse buildings. Located close to Vauxhall Mainline and Underground Stations, the site has the scope to be redeveloped to provide a higher density of new building and a mix of uses including commercial, residential, retail and leisure. All such redevelopment options, together with the ongoing discussions with our existing occupiers will continue into the second half of 2007.

We have continued to work with our joint venture partners to carry forward the London Bridge Quarter Project, comprising the London Bridge Tower (The Shard) and the adjoining 25 London Bridge Street. Once complete these two Renzo Piano designed buildings will provide 176,514 sq m / 1,900,000 sq ft gross of high quality office, hotel, residential, retail and leisure uses immediately adjacent to London Bridge Mainline and Underground Station.

At London Bridge Tower (The Shard), PwC will be vacating the existing office
building on the site this month thus allowing the enabling and demolition works
to begin in the final half of the year.

At 25 London Bridge Street, a revised planning application was submitted in
April and was subsequently passed for approval by Southwark Council at
Committee in early July. This new application achieves the same gross floor
area but within an entirely new roof profile, incorporating two new roof
terraces and improved external facades.

The funding options for both projects are under review with a view to achieving completion before 2012.

During the first half the vacancy rate across the UK portfolio has reduced from 8.2 per cent to 6.5 per cent

God this is a tough one - I am an optimist one day and a total pessimist the next - this project is enough to make anyone scitzo. It's been a tough week with a possible Leadenhall delay, Beetham and the vauxhall tower issues and mostly the credit crunch and I am pretty sure we will see a substantial house price drop in London (at least I hope so). It will be much tougher to get financing for the shard. After saying all of that I still am air on the side of optimism when it comes to this project.:)

been digging a bit digger into this - i think the CLS report posted shortly after wjfox2002s original post rather supports his view that funding is far from being a safe bet. As far as i can see the only real thing that happened since then is Halibi dropping out and probably being replaced by Quatari or alternative funding. However this doesn`t solve the funding problems accountered by the original investors incl. CLS. And i think the quote by spenster nicely summarizes nicely how all this can be quite confusing in the end. Am I right or has something else lead to your radical change of opinion, wjfox2002?

Lol. I've oscillated from one opinion to another on this project. However, recent news, combined with further discussion in this thread has given me a much clearer picture of what's happening between the different parties. It's obvious Halibi will sell (the banks have told him to, and he needs the money anyway), and the Qatari government will take his share (they have shitloads of money). Once this happens, they'll be in a far stronger position with regards to funding. The partnership will also be restructured to better safeguard delivery of the project.

Spot on Will! Still lurking, still getting my shard google email alerts and still keeping my fingers crossed like the rest of you. Good things come.........

As I said in my previous post I hate being negative, but this project is like a f'in roller coaster, huge up and even bigger downs.

Will I take your point, and hope your right on this one.

And just to feel better, here's a banana...:banana:

will is entirely right in his diagnosis :)

I very seldom post on this thread- I find it all too frustrating. I have followed this scheme since the original (pre shard) design. I will start to believe when actual construction starts and I can see cores going up. Every bit of 'news' before then just leads to exasperation.

...apparently a Russian one was advised against investing £100m...

Dam that interfering Coth!

Estates Gazette -

Despite the ten day deadline having past Simon Halaibi is continuing to negotiate the sale of his stake in the Shard.

I expect he is attempting to squeeze every last penny out of the deal.

^^ Yeah, exactly what I said weeks ago. What a spanner.

He'll surely give in soon. He has to, or he's in severe money trouble.

What odds do you reckon you'd get on the shard being cancelled? 2/1? Even money? Are there any bookies who would even take the bet?

5% to 10% for me.

Providing this A hole sells up, it should be all guns blazin'.

In my opinion if the Qataris are on board it is very likely that it will be built - they have so much money that they can go for the medium-long term unlike investors in the UK who are chasing after maximum quarterly growth. With the piles of petrodollars they are sitting on they can sit back for 10-15 years on an investment. And this project will undeniably be a superb investment.

The oil price just nudged $88 a barrel btw ;)

^^^ Yes, I was reading that they are investing in the long term for the benefit of their country. A very sensible thing to do IMO. The only danger I can envisage is the Tokyo effect. When Japan was huge investor in the world it was great for everyone.....but if the second great Kanto Earthquake had occurred during that period, all investment would have been sold off and withdrawn post haste. ..What the hell, Im no economist.

Do you know I actually dreamt about this stupid saga last night? I don't even know what Halabi looks like and he's invading my dreams being a stubborn bastard.

If LBT is cancelled I shall be needing therapy for post traumatic stress.

Who are these men in white coats?

I don't even know what Halabi looks like and he's invading my dreams being a stubborn bastard.


:) In my mind he looks just like Sham, my dodgy slum landlord.

He is that landlord in the League of Gentleman.

http://www.telegraph.co.uk/money/graphics/2007/08/07/cnesporta107.jpg
I think this is the man, we can all put a face to our nightmares now....

http://www.telegraph.co.uk/money/graphics/2007/08/07/cnesporta107.jpg
I think this is the man, we can all put a face to our nightmares now....

That isn't him. Here is the article you got the photo from...

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/08/07/cnesporta107.xml

The above man is Neil Gillis. He doesn't exactly look like a 'Halabi' does he ;)

I can't find a photo of him - but he is meant to be 'secretive' so that's perhaps not surprising.

:runaway:OOPS!!!! Sorry.

We've actually gone a relatively long time now since the last sensationalist article about LBT's impending cancellation, which is nice.

However, i'm not sure that no news is good news here. I really want to hear definitive news that Halabi has sold up and that funding has been secured. Only then can I even think about letting out those dancing bananas...

I don't know about those guys on the Chicago forum. They actually bought a bottle of champagne and poured the entire thing into the foundations of the Chicago Spire. I can't imagine any UK forumers doing that:cheers:


what a waste of champagne, they'd have been better off drinking it.

:cheers2::cheers2::cheers2::cheers2::cheers2::cheers2:

Precisely-especially as the Chicago Spire is on such dodgy ground financially.

^^ is it?
i wasn't aware.

^^ Well no bank loan is in place and the units would have to sell at a multiple per sq ft of what has ever been done. Right now there are 6500 flats on the market in central Chicago with 17,500 building. We shall see.

Good grief! This thread has reached 102 pages - with not a lot to show for it :ohno:

http://i202.photobucket.com/albums/aa278/fit3xl/bbc004.jpg

Here it is today. Very little external progress since the last pics:

http://i202.photobucket.com/albums/aa164/SELondoner/07London/LBT005-1000.jpg

http://i202.photobucket.com/albums/aa164/SELondoner/07London/LBT001-1000.jpg

http://i202.photobucket.com/albums/aa164/SELondoner/07London/LBT008-1000.jpg

Here it is today. Very little external progress since the last pics:

http://i202.photobucket.com/albums/aa164/SELondoner/07London/LBT005-1000.jpg

http://i202.photobucket.com/albums/aa164/SELondoner/07London/LBT008-1000.jpg

Ooook. Let's compare with photos I took last Saturday (13/10).

http://i24.tinypic.com/21jssjc.jpg

http://i24.tinypic.com/2vlruhg.jpg

Progress in 7 days: Big Fat Zilch. :bash:

Here is that article mentioned the other week, whoever that fucking estate agent was I would like to ring their neck!






Glass Dream Could Be Shattered By Wrangle

Evening Standard; London (UK), 2007-10-12

By PETER BILL


LAST week in Moscow a British agent (of the estate variety) said he told a Russian client not to be silly when asked if it would be wise to spend Pounds 100 million on a stake in London's "Shard of Glass". A great pity, for long-laid plans for this beautiful skyscraper adjacent to London Bridge station are in danger of being ripped up.
Money is, of course, the problem.

Well, money and personalities. Right now two of the parties, who hold a twothirds stake, are trying to force the third party with whom they have had a terrible fight to sell his one third to a fourth party.

Party one is cheeky-chappie Londoner Irvine Sellar, 67, who has been pursuing his dream since before the beginning of this century.

Party two is Sten Mortstedt, also 67, a shy Swede, from property company CLS Holdings.

The unwanted party is Simon Halabi, 49, a saturnine Syrian, whose UK property empire was valued at Pounds 2 billion before the market went all funny this summer.

On 18 September Mortstedt confirmed that "final negotiations" were under way "with a bank and a new owner-partner" to take the Halabi stake in the 1016 ft tower.

Hints that the fourth party was from the Middle East led to stories the next day that the Qatari royal family was interested that's right, the guys trying very hard to take control of Sainsbury's.

Twenty four days on and, as of yesterday, radio silence. This could be because the Qatari assumption is wrong. Or, if right, their representatives are too busy shopping for Sainsbury's.

Or, if not too busy, they are squeezing the deal in true Dragons' Den style. If that's true, let's hope Halabi accepts an offer quickly and gracefully.

An announcement today would be nice; if not, pretty soon. Because this feels very much like the endgame for the 70-storey tapering tower, designed by the celebrated Italian architect Renzo Piano.

It's been a long journey for Sellar, who began life as a market stall trader.

His last property business went bust for Pounds 132 million in 1991. When he bought the Southwark site in 1999 for Pounds 37.4 million, few would have bet on a man in the autumn of his career conjuring up what could be an icon for London.

But in March 2001, to his eternal credit, Sellar unveiled Piano's elegant plans for a 600 000 sq ft tower. They were met with scepticism in the property community. They were violently attacked by English Heritage, who forced a public inquiry, which concluded in November 2003 the tower was fine and could be built.

IN late 2004 the trio had to pay PricewaterhouseCoopers around Pounds 70 million to break a lease that lasted, incredibly, until 2100 on the existing nondescript offices.

Around then a court battle with Halabi over the size of his stake began. That concluded at the end of 2005 with an undisclosed settlement. As a result, Sellar is now suing his solicitors Eversheds for Pounds 55 million.

The brighter news is that in early 2005 the Shangri-La hotel group agreed to run a hotel over 18 floors, then, last summer, Transport for London signed up for 180,000 sq ft. At this point the

Shard almost became a reality. Since then the detailed design work has gone into overdrive. But it may all be for nothing.

With current sentiment so brittle, a breakdown in talks would shatter Sellar's dream of a Shard of Glass shimmering over London, forever..

PETER BILL IS EDITOR OF ESTATES GAZETTE www.egi.co.uk

(c) 2007 Evening Standard; London (UK). Provided by ProQuest Information and Learning. All rights Reserved.

Sell your share you stupid b*stard!

Hmm, I thought the ES hated towers, the Shard in particular. I bet once it is announced as a go they will be 'Ugh it will ruin London!!!!!!' again lol.

Aaaaaaaaaaaaaaaaaaaaaaaaaaaargh.

NEWS. NOW.

Not looking good is it?

Oh well, it was fun whilst it lasted. Lets turn our focus to other projects and hope that an eccentric billionaire funds the Shard.

i think the decision to build it will be made soon, it will open empty, and people will call it a white elephant. within 5 years of being built it will be full and people will have forgotten all about its problems , just like canary wharf which laid empty in the early 90s .

a British agent (of the estate variety) said he told a Russian client not to be silly when asked if it would be wise to spend Pounds 100 million on a stake in London's "Shard of Glass".

people WANT to invest in it but for halabi. i find it inconcievable though he would crash the project as he would lose tens of millions.

That story is no story...a slow day I guess......we will all know pretty soon....I am still convinced this will all happen as planned.

We should start to accept that this is one scraper that ain't gonna be built. The writing is on the wall.

Never. I will continue to blindly cling to hope while berating the complete lack of progress and weeping at all the doomladen news stories.

We should start to accept that this is one scraper that ain't gonna be built. The writing is on the wall.

Why? Providing Halabi sells, which he WILL (he would be ruined if he doesn't) we will have funding, and two pre lets. It will be in a better position than any other tower in London.

He's taking his sweet time to sell up - what happened to the '10 day deadline' that passed about 6 weeks ago? :|

Ive never met the guy and I really dont like him already

Ive never met the guy and I really dont like him already

Hes not unattractive in a 'business' type of way...here he has just been negotiating a tough deal.
http://i20.tinypic.com/15dvpkw.jpg

^^That bastard ran off with my wife!!!

That is my wife!!!!

That is my wife!!!!

Get your hands off she's mine :banana:

The thing is, even when, (as is looking increasingly likely), this project is cancelled, there will be plenty of forumers who will simply shrug their shoulders and say "oh well at least we're still getting the Pinacle, 122 Leadenhall and Heron" and continue posting dancing bananas as if losing the Shard is no biggie. Sorry but losing the Shard will be a massive loss for London, and right now its future appears to be hanging by a single thread...

It might be that the delay is just Halabi trying to do a last minute deal to stay in the Shard consortium, just came across this piece from last month about him trying to sell off a lot of other stuff. The talk of him selling off his shard share surfaced earlier in the year, perhaps he has changed his mind?


http://www.ft.com/cms/s/0/b799f5d8-473e-11db-83df-0000779e2340.html

Halabi looks to sell £1.8bn UK portfolio
By Jim Pickard, Property Correspondent

Published: September 18 2006 22:04 | Last updated: September 18 2006 22:04

Simon Halabi, a secretive Syrian-born tycoon, is seeking buyers for a £1.8bn ($3.4bn) portfolio of properties thought to be the largest ever put up for sale in the UK.

It is understood that the entrepreneur has hired BH2, the niche property advisory firm, to sell seven assets including the 23-storey Aviva Tower in the City of London.


ADVERTISEMENT
Mr Halabi paid £225m for the 316,000 sq ft tower in 2003, since when the price may have risen to more than £400m.

Other buildings in the portfolio include two of JPMorgan’s office blocks.

“This is by far the best portfolio of buildings to come up in London for as long as I can remember,” said a source close to one potential buyer.

The portfolio dwarfs even last year’s sale by Abbey, through subsidiaries Scottish Mutual and Scottish Provident, of assets to ING for £1.3bn.

Mr Halabi is likely to be seen as calling the top of the commercial property market, where prices have soared amid never-ending demand from fund managers, foreign buyers and syndicates of private investors.

ING, for example, is today understood to be launching five new European property funds worth €5bn ($6.3bn).

Swiss Re, which has decided to sell the Gherkin – London’s most iconic modern building – is marketing the building at a yield of just 4.5 per cent.

However, a source close to Mr Halabi said the sale was a “refocusing” and the tycoon was currently buying several other buildings in central London.

It emerged this summer that Mr Halabi had decided to sell his one-third stake in the Shard of Glass, a proposed skyscraper at London Bridge.

Mr Halabi had fallen out with partners Irvine Sellar and CLS Holdings, although a legal action between the two sides was settled out of court.

Copyright The Financial Times Limited 2007

The thing is, even when, (as is looking increasingly likely), this project is cancelled, there will be plenty of forumers who will simply shrug their shoulders and say "oh well at least we're still getting the Pinacle, 122 Leadenhall and Heron" and continue posting dancing bananas as if losing the Shard is no biggie. Sorry but losing the Shard will be a massive loss for London, and right now its future appears to be hanging by a single thread...

Well, life goes on.

As utterly fantastic as the Shard is, it's not the end of the world if it is cancelled. We can't all be expected to mourn the loss as if it was a valued family member, and allow it to shroud out excitement when other stunning buildings finally get under way.

If this is cancelled, it will be a crying shame. But there really won't be much anyone can do about it :dunno:

:)

This project will happen. Keep the faith, people!

It might be that the delay is just Halabi trying to do a last minute deal to stay in the Shard consortium, Yes, I think that too.

Halabi clearly felt that the credit crunch would be a blip and gone now (it's barely started IMHO) and he'd have the funds secured by now for the Shard. He would not want to withdraw from such a prestigious project so easily. But the other two partners must have some sort of clause in the Shard contract that says that Halabi either puts up the money by a certain date, or, withdraws from the project and allow another partner to come on board.

There is a tight timetable with this building and it must be completed before the Olympics starts when all the world's media/business folks descend on London.

There is a tight timetable with this building and it must be completed before the Olympics starts when all the world's media/business folks descend on London.

Im sorry, i dont understand this obsession with getting it ready for 2012...London dosent need to raise its profile by having a 300m scraper in place for the world to see.

London is bigger than that.

Sure, from an asthetic point of view it would be nice, but to most of the watching world the Shard will be just another skyscraper, for sure a very nice one, but not even a very tall one by world standards.

People dont come to London for the skyline, they come for the history.

oh they will come for London Bridge Tower! This is the only proposal out there that will have the same impact as the Gherkin, I actually mean a far greater impact, maybe imagine a super child hybrid of the Gherkin and the London eye! People will proactively visit this building to have their photo taken in swarms.

Im sorry, i dont understand this obsession with getting it ready for 2012...London dosent need to raise its profile by having a 300m scraper in place for the world to see.

London is bigger than that.

Sure, from an asthetic point of view it would be nice, but to most of the watching world the Shard will be just another skyscraper, for sure a very nice one, but not even a very tall one by world standards.

People dont come to London for the skyline, they come for the history.When the olympics come, there will be a marketing blitz on the city. Only a fool would not take advantage of all that free advertising and the money that goes with it.

Im sorry, i dont understand this obsession with getting it ready for 2012...London dosent need to raise its profile by having a 300m scraper in place for the world to see.

London is bigger than that.

Sure, from an asthetic point of view it would be nice, but to most of the watching world the Shard will be just another skyscraper, for sure a very nice one, but not even a very tall one by world standards.

People dont come to London for the skyline, they come for the history.

1. I think you massively underestimate the effect LBT will have on London's image. It won't be "just another scraper".

2. People visit London for a variety of reasons. It isn't just about history. The sight-seeing and the landmarks are an important part of the experience.

3. 310m makes LBT a supertall. Even by American standards it's pretty tall. In the middle of London, though, it's something you'd never expect to see. The effect will be spectacular.

Surely Halabi can only be clinging desperately onto his stake because he knows just how much it will be worth when the tower is built? This project despite the initial expense will have big returns. Surely someone is prepared to take on that risk?

People dont come to London for the skyline, they come for the history.

I just cry every time someone says this. Really, I do.

I'm not going to start getting depressed prematurely because I don't want to look like a prat when the construction contracts are signed. Whilst there is the possibility something extremely strange is going on and Halabi is committing financial suicide, the likelihood is that something else is going on, something we'll find out about in the months to come, and something that'll easily explain the delay. For this reason I actually say that slience is a good thing. If it was all over, the various other parties would take the first opportunity to publicize whoever they felt was responsible to extract maximum possible 'political' capital out of an embarrassing situation. Whatever is holding it up cannot possibly somehthing requiring a legal gagging order, therefore the parties involved are keeping schtum because something valuable is still on the table and up for grabs, and no one wants to give away their positions, as is appropriate in all business until the deal is done.

The main backer has made it clear this project is on ice and they have not exercised their option with Halabi to buy back its shares. New investors are needed for the project to eventually go ahead an additional bank loan need to be secured - which far from being certain because most banks have put on hold assets-backed deals until the end of the year.

Does anyone know how long planning permission lasts on a project like this, and if it can be easily extended? Given the current climate in the credit markets and the sheer volume of competing projects, a delay might be a shrewd move. Building costs may come down once the other towers and the Olympics are out of the way.
Spectacular skyscrapers have a habit of coinciding with financial market tops. The Empire State and Chrysler buildings were built just in time for the depression. The Sears tower and World Trade Centre were built at the 1973 stock market peak. The high rise towers of Tokyo were completed in time for their bear market in 1989 and the Petronas towers for the Asian financial crisis of 1997. Bull market tops and skyscrapers both signify extreme optimism.
I remember reading about the four huge towers planned for the South end of Times Square in 1987. I saw the last one being topped out in 2003.
If we can just keep this thread going a while.......:)

Will, Goth , someone with some info rather than the usual forum speculation pls.
Can we say goodbye to it or this this inter investor financial rangling?
Are the arab funds pulling out? Is there other £££ available? Eeh oop

No one knows anything because nothing has been announced yet!

Im sorry, i dont understand this obsession with getting it ready for 2012...


Could it be to do with the filling up the top range hotel within with olympic visitors?

So if we all know nothing is this talk of imminent collapse all just hot air?

Well, we don't of course know anything concrete, but we are extrapolating from the complete media silence when news was expected, and the apparent ceasing of demolition works on Southwark Towers. :(

Ive been checking out the demolition every other day and there is certainly activity with people on site and working on the scaffolding and equipment being moved about, perhaps the scale of the building makes it look like stuff isnt moving as fast as to what we are used to?!

Demolition hasn't ceased. They already have the funds for demolition which is going ahead as planned, regardless of whether LBT is built.

Well, I am happy to stand corrected on that one. :)

It's just that if you compare the pictures SELondoner and I posted back on page 102, for the life of me it looks like they made absolutely no progress in an entire week...

What worries me is not only that this project won't go ahead, but what will be built its place will be some bland uninspiring crap, which will sail through planning permission without objection because it won't be tall - something like St Boltophs House perhaps. In which case, to paraphrase a famous Sun Headline "Will the last person to leave London, please turn out the lights?" :ohno:

Be realistic this tower aint going to happen now it will soon be listed as a never built project just like the Minerva tower:ohno:

No one knows anything because nothing has been announced yet!

tell that to forumers here who get so worked up because some hack recycles an old story to make a bit of money.

tell that to forumers here who get so worked up because some hack recycles an old story to make a bit of money.

Aha

Funding fear ends Mace’s Shard deal

Laing O’Rourke is being lined up to take over from Mace to build the 310 m-high Shard of Glass building in London.
Mace had been doing the work on the Shard on a construction management deal but the Teighmore development team, led by Sellar Property, is set to ditch the CM route in favour of a fixed-price contract.

The decision was made after months of funding problems with banks unwilling to bankroll the deal under CM.

Banks are understood to have told Teighmore that they will only get involved in the scheme if the work is let under a fixed-price contract.

The move has raised fears that banks could make similar demands on other high-profile projects yet to sign off their financing.

One expert said: “At the moment, banks want certainty about what they’re getting involved in. Fixed-price means they cap their exposure to the contract.

“Some big jobs got their financing away before the credit crunch happened but if funding wasn’t signed and sealed then they’ve got problems. Banks are cutting their lending books and I wouldn’t be surprised if this is the start of a wider trend.”

The Shard, which will eventually go up close to London Bridge train station, carries a construction price tag of Ł350 million and O’Rourke is expected to take over from Mace some time before Christmas.
It is believed Teighmore only began initial discussions with Laing O’Rourke recently, after approaching chairman Ray O’Rourke about the possibility of carrying out the deal.

Irvine Sellar, chairman of Sellar Property Group, has had to endure a series of frustrations in recent months after co-investor Simon Halabi decided to sell his stake in the job after racking up a series of losses on a failed leisure business.

Mace, which along with Laing O’Rourke is part of the CLM project management team on the 2012 Olympic Games, began work on the job last year.

But it is now bracing itself for a vastly reduced role. One insider admitted: “I think our role will be limited. It’s disappointing to say the least because it’s a great, high-profile scheme.”

Mace had been due to pick the winner of the key steel contract this month.

A colourful past

The Shard’s progress from the drawing board to reality has seen it linked with some of the industry’s leading names.

In 2001 Bovis Lend Lease was lined up as project manager, only for Multiplex to take over as pre-construction advisor in 2003. In November that year the tower was given planning approval, with Shangri La signed up on a pre-let for the hotel element in February 2005.

Mace stepped in last year after Multiplex walked away citing a change in its strategy towards risk.

Keltbray has carried out enabling works ahead of an eight-month demolition. Construction is due to take 40 months to September 2011.

Analysis: Is fixed price now the way ahead?

By Alasdair Reisner

In recent months, the Shard has sat in a shadow cast by the difficulties in the global finance markets.
The decision by Simon Halabi to sell his stake in the project came at precisely the wrong time as markets wobbled and the Shard struggled for backers.

By fixing the price, the developer team is hoping to get the banks to back it.

Fixed-price evokes memories of Wembley Stadium, the deal that saw Multiplex take a £200 million battering.

No contractor wants that type of hit but fixed-price seems to be the only way a job like the Shard will be built.

What is certain is that it is not the only project to find itself in this position.

Developers are fond of making gung-ho noises about how confident they are that their projects are going ahead. But to get off the ground, many could now consider following the Shard’s example.

http://www.cnplus.co.uk/News/funding_fear_ends_maces_shard_deal.html

So much for everyone saying the credit crunch won't affect these projects.

well its sounds like it is still on track! Had a heart attack when i read the headline, my eyes went all blurry and my head dizzy but after reading it it explains the delay and Sellar said it would need refinancing so this is good news as it is an announcement of success in the refinancing of the scheme.

One thing i dont understand is that it is unclear as to what has happened to Halabis part

Had a heart attack when i read the headline, my eyes went all blurry and my head dizzy ...

Lol, me too. This project is more important than all of the other towers put together.

This news does seem to be reassuring although i can't put my finger on why. I do think the shard will be an undoubted success for London when it starts to rise but it will not be the end of the world if it is not built, the city cluster seems much more important to me. Don't get me wrong, i really want this tower to happen, but if it came to choosing between the pinnacle, leadenhall and heron, and the shard, i would certainly choose the former 3. Now somebody just sign a bloody finance deal before the credit crunch gets any worse!!!

If Sellar and O'Rourke can both put pen to paper then LBT will be built, i'm certain. So let's hope, eh.

I am surprised that any company would agree to undertake work on a strict fixed-price contract for such a large scale project, especially with building costs rising so rapidly over the past year. As ^^ that article mentions, Multiplex took a battering under such an arrangement building Wembley Stadium (although admittedly their handling of the site and the workers there was a complete shambles).

Multiplex have done it again with the Pinnacle contract.

So much for everyone saying the credit crunch won't affect these projects.

That is not my recollection...I do, however, recall certain persons claiming this and other prjects would not go ahead full stop, due to the credit crunch

Oh Touche! You are oh so correct mulattokid!!

Shame about Mace being dropped - me, Jimbo and Mulattokid spoke to one of the guys involved. He was going to get us free tours of the Shard during construction! Oh well, perhaps somebody at Laing O’Rourke can do this instead.

I do, however, recall certain persons claiming this and other prjects would not go ahead full stop, due to the credit crunch

I don't see any tower cores on the skyline at the moment...

Hmm 201 BG, Pan P, Marsh wall, Ropemaker, work started on 100middlesex St & Castle house. what more do you want.

If you are referring to the "biggies" in the city then it would be a little hard to build cores on a building being demolished wouldn't it. Theres no need to be so pessimistic all the time.

Shame about Mace being dropped - me, Jimbo and Mulattokid spoke to one of the guys involved. He was going to get us free tours of the Shard during construction! Oh well, perhaps somebody at Laing O’Rourke can do this instead. I presume the change in developer won't lead to any downgrading of materials used, say in the cladding?

I presume the change in developer won't lead to any downgrading of materials used, say in the cladding?

Planning permission is dependent on the highest quality of cladding, so no worries there.



Theres no need to be so pessimistic all the time.

I agree. Darren is turning into another JamesC. Construction has started on the Leadenhall Building, Heron site is almost cleared and ready for basement works, Pinnacle is 99% confirmed for a February start, Broadgate and Pan Peninsula are nearly complete, Stock Exchange has a shiny new reclad, numerous other projects are underway or will be starting next year...

...numerous other projects are underway or will be starting next year...

Including this one, we fervently hope...

Guys, the credit crunch is taking hold, there's a recession coming, banks are tightening up their belts and there is too much work out there and not enough contractors to build the projects - whilst I am happy we have projects ongoing to talk about and the residential market is currently buoyant, anything commercial that doesn't have funding or a final contractor by now is simply dead, at least for a 2008 start.

Heron hasn't signed any contracts, the Pinnacle is having multiple delaying issues between Multiplex and the Arabs, the Shard is on ice until at least the new year and from what I've been hearing 122 Leadenhall may not be so certain in terms of cracking onwards next year.

There's going to be a lot of scratching heads and temper tantrums next year when these demolition sites are boarded over and the workers move out and nothing happens. It's called caution and facing reality.

Guys, the credit crunch is taking hold, there's a recession coming, banks are tightening up their belts and there is too much work out there and not enough contractors to build the projects - whilst I am happy we have projects ongoing to talk about and the residential market is currently buoyant, anything commercial that doesn't have funding or a final contractor by now is simply dead, at least for a 2008 start.

not really understanding the concept of micromarkets within property are you?

The thing is, even when, (as is looking increasingly likely), this project is cancelled, there will be plenty of forumers who will simply shrug their shoulders and say "oh well at least we're still getting the Pinacle, 122 Leadenhall and Heron" and continue posting dancing bananas as if losing the Shard is no biggie.

And Newcastle Kid will still be saying that he's 93.67% certain that it's going happen! ;)

not really understanding the concept of micromarkets within property are you?

Explain? I'd have thought that a micromarket in the current climate would need to have some pretty substantial prelets. OK Shangri La are on board but TfL are rumoured to be looking at other options, PwC are signed up in More London, I'm taking it that you are saying you're aware of another prelet????

I am afraid that DarJoLe is unfortunately right to be worried. I work in the financial markets and right now I feel there is a state of denial regarding the value of securitised mortgage debt. Merrill Lynch just bumped up their loss estimate by another 2 billion to over 7 billion. You don't have major Wall St firms taking 7 billion hits without severe job cuts.
These towers need to be looking for tennants outside of the banks. I know we could fill them with small boutique companies, but would they pay the premium rents? This doen't mean they won't get built, but it might make sense to go slow. You want to complete when the city is coming out of this, and that maybe later than 2010 /11.

I am afraid that DarJoLe is unfortunately right to be worried. I work in the financial markets and right now I feel there is a state of denial regarding the value of securitised mortgage debt. Merrill Lynch just bumped up their loss estimate by another 2 billion to over 7 billion. You don't have major Wall St firms taking 7 billion hits without severe job cuts.
These towers need to be looking for tennants outside of the banks. I know we could fill them with small boutique companies, but would they pay the premium rents? This doen't mean they won't get built, but it might make sense to go slow. You want to complete when the city is coming out of this, and that maybe later than 2010 /11.

Indeed, not to be too negative but there is little that the markets like less than uncertainty. My view for what it's worth is that the current credit crunch is a storm in a teacup in the UK but it creates doubt and that is going to impact major construction projects, particularly those targetting the financial services sector. The Merrill Lynch news is adding to increased uncertainty in the City. When a major global IB catches a cold the UK markets start sneezing.

I really hope I'm wrong but to quote Bollo from Mighty Boosh 'I've got a bad feeling about this'

the point is top spec office space in residential towers is an elite micromarket. its pretty much insulated from normal office demands in the city because there is so little of it. people thought greycoat were insane when they bought the trashed natwest tower in the middle of a recession and did it up. they had the smart idea of making it multi tenanted with companies able to rent as little as a third of a floor each. by 1996 it was fully let and has been hugely profitable ever since. heron and bishopsgate tower are being built the same way, leadenhall is also appealing very much to this market with its small upper floors. until london is saturated with such towers, this market will continue to operate outside the normal rules.

I know we could fill them with small boutique companies, but would they pay the premium rents?

they do exactly that. its a well proven formula for developers in london who can afford to start building a project without a major pre-let and it seems to work. in the short term its hideously expensive, in the long term its probably the most profitable option.

i dont think people quite get the importance of them signing a fixed contract, its hugely positive for the project on the risk front if they can say "this is definitely how much it will cost". laing clearly think they can make money from it so why not.

the point is top spec office space in residential towers is an elite micromarket. its pretty much insulated from normal office demands in the city because there is so little of it. people thought greycoat were insane when they bought the trashed natwest tower in the middle of a recession and did it up. they had the smart idea of making it multi tenanted with companies able to rent as little as a third of a floor each. by 1996 it was fully let and has been hugely profitable ever since. heron and bishopsgate tower are being built the same way, leadenhall is also appealing very much to this market with its small upper floors. until london is saturated with such towers, this market will continue to operate outside the normal rules.



they do exactly that. its a well proven formula for developers in london who can afford to start building a project without a major pre-let and it seems to work. in the short term its hideously expensive, in the long term its probably the most profitable option.

i dont think people quite get the importance of them signing a fixed contract, its hugely positive for the project on the risk front if they can say "this is definitely how much it will cost". laing clearly think they can make money from it so why not.

But the rumours are that TfL payed well below market rate for a prelet last year when market conditions were far stronger, what gives you confidence that tenants willing to pay market rate can be found now in this uncertain financial climate?

well minerva just got some yesterday for the city of london in a shit heap of a building. basic rules of economics make me confident. the higher up the building the floor is the more people pay... it works everywhere else so why not the shard?

the reason TFL got such good rates is because they got a discount as the result of doubt the shard might not be built. companies dont want to commit to letting somewhere that wont be realised thus leaving them up shit creek without a paddle but in preparing for this risk TFL have of course looked elsewhere just in case. the second the risk in this goes away youll see them queuing up and everyone will be praising TFL for the wonderful bargain it struck in getting space in a super-prime office building so cheaply.

once they get the goahead and it starts to rise they can easily fill the smaller office floors up with bespoke companies if they like. if they want to be really smart theyd deliberately keep it empty until its finished and then charge batshit insane rates like swiss re. everyone dissed them for having half the gherkin empty but they were literally picking and choosing their tenants and having them compete against each other in terms of price for every single bit of space.

an example of a micromarket is infact whats happening in southwark now where prices are rising much faster than elsewhere in london. some areas like bankside are starting to look like they will rival knightsbridge! i had a chat with someone at knight frank about this specifically a couple of weeks ago and everyone seems to think this building will have the same effect on the locality as the tate modern has on bankside.

For example, here's a plan of the tenants in the Gherkin. http://www.30stmaryaxe.com/availability.asp

I am certain that there would be absolutely no trouble, even in the depths of a recession, to fill up LBT. The thing that is holding it back is simply the risk tied up with taking out such large loans. This will be an expensive project, but there is also a lot of profit waiting at the end of it. This is why i'm sure LBT will be built by someone. We just need to hang on for the news. Though I admit my patience has worn very thin...

What I want now is some more demolition pictures, to assure me that theyre actually doing something on site...

i suspect the reason halabi isnt selling his stake is he is convinced it can be built in the current climate and the project is worth much more to him complete than if he sells out now.

If Sellar and O'Rourke can both put pen to paper then LBT will be built, i'm certain. So let's hope, eh.

I think you don't have your name for nothing :) - you've hit the nail on the head there.

It's all gonna come down to these negotiations with O'Rourke (or a competitor who is willing to do a fixed price contract) being successful or not. The credit crunch is taking it's toll at this point - no matter if there really is gonna be a further extension of the crisis or not. Banks get more restrictive on their lending and get more power in their side of the deal, therefore can force developers to go safer options like the fixed price story. At the same time with the housing crash in the US (the original starting point of the credit crunch) being feared to affect the UK letting market the situation of not having full prelets for a development gets more risky for developers. Microclimate or not - there's plenty of competitors in the city with speculative builts which will all have to be filled already before the Shard would be finished. More competition means more risk especially if the general environment is getting more risky already. So it all comes down to a simple factor - the most important one in the market: price. Sellar and their partners will have to pay a nice premium to get a fixed price deal (especially considering exploding commodity prices - another major recent market development) and it will all come down to them willing to pay this premium or not while considering growing risks of a speculative build in a more risky letting market. If they accept the fixed price that will be asked getting it financed will be all downhill

These towers need to be looking for tennants outside of the banks. I know we could fill them with small boutique companies, but would they pay the premium rents? This doen't mean they won't get built, but it might make sense to go slow. You want to complete when the city is coming out of this, and that maybe later than 2010 /11.

The city is very competitive & value for money compared to other areas at the moment, Mid-town has recently seen higher rents in than the city & companies that were traditionally in Mayfair & parts of the west are actually moving into the city because it is cheaper.

Darjole- not sure where you have your info but Heron , the Pinnacle & 122LH are steaming ahead. Theres been no news from te pinnacle & Heron particuarly as the money is being put forward from Arab consortiums not public companies or developers up to there eye balls in debt. As such they have no need to report for compliance or for stock market/investor relations purposes & have no need to put out story's to the press to shore up share prices etc. With regard 122LH I would say with piling happining it would be crazy for BL not to go on & complete the building- even if everything went belly up tomorrow BL are big enough & smart enough to build 122 & at worst have an empty building sitting on there books .


Sure nothings 100% & with LBT the credit crunch is the latest story/reason for it not being built- prior to the summers credit storys there has been numerous other reasons why LBT wouldn't be built.

And the story rumbles on.......

- - - - - - - - - - - - - - - -- -- - - -

Halabi feels the heat

26.10.07

Simon Halabi’s meteoric rise in UK property has been tempered by the collapse of his Esporta fitness chain. Deirdre Hipwell finds out how he plans to fight back

By Deirdre Hipwell

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In the 2003 Sunday Times Rich List he was ranked 159th with an estimated fortune of £200m, but by 2007 he had soared to 14th place and was valued at £3bn. This year he ranked 194th in the Forbes World Billionaires 2007 list, ahead of Richard Branson’s $3.8bn (£1.86bn) Virgin Media.

Syrian-born Simon Halabi’s rise to prominence in the UK property industry and worldwide has been meteoric.

He counts himself as one of the largest private landowners in central London with a £5bn portfolio, including debt, that he invests and manages for the Halabi Family Trusts. Among the prized assets in his portfolio are the 23-storey Aviva tower in the City and the former In and Out Club in Piccadilly.

But since August, times have been tough for the intensely private Halabi, following his £460m takeover of health and fitness chain Esporta earlier this year.

The deal went horribly wrong, leaving Halabi facing a loss of more than £100m of equity and also owing massive debt to his long-time financial backer, French bank Société Générale, which funded the Esporta deal. Speculation, which he denies, followed that he is planning to sell his one-third stake in the Shard tower and other central London assets to help repay hefty debt obligations.

Two months since Halabi’s very public fallout from a miscalculated foray into the leisure industry, Property Week looks at his empire, his plans for the future and the sale of his stake in London’s most anticipated development the Shard at London Bridge.

It emerged this week that several big names have left Halabi’s side in recent weeks. Among these are Nigel Kempner, director at Grafton Advisors and a non-executive director at Buckingham Securities, who was appointed to manage a potential bond issue of Halabi’s £1.8bn Protractor portfolio, and finance director Harry Sira, who will now advise on a consultancy basis. Halabi’s development director Andrew Bugg has also resigned.

The £1.8bn Protractor portfolio is the key component of his property holdings, and speculation has been rife that Halabi has been sounding out the market about selling some of the assets to pay down debt.

Protractor mainly comprises City and South Bank buildings, such as: the Aviva Tower; Alban Gate and 60 Victoria Embankment, which is let to JP Morgan; Millennium Bridge House, which is let to UBS Asset Management; Ludgate House, which is let to United Business Media and home to Property Week; Sampson House, which is let to IBM and the adjacent residential development Falcon Point; New Court in London’s West End; and the BSI Tower on Chiswick High Road in west London.

In total it comprises around 2.1m sq ft of office space and generates an aggregate net passing rent of around £83.5m a year, which equates to around £38.40/sq ft. More than 85% of the income in the short term is assured for more than eight years, while in the long term 41.5% of the income is secured over 17 years.

Equity take out

Halabi has taken out most of his equity in Protractor after an aggressive £1.45bn refinancing of the portfolio in November 2006 with SocGen. As part of the deal, Halabi also bought Royal & Sun Alliance’s headquarters at Leadenhall Court in the City.

Much of SocGen’s debt was syndicated at the time, also leaving it with little exposure to the portfolio. This means that Protractor is effectively controlled by a series of bondholders, who must be getting uncomfortable about its inevitably falling value in the current tough market.

SocGen holds shares in the holding vehicle that carried out the refinancing of Protractor. The refinancing followed an attempted sale of the portfolio in 2005, which was eventually withdrawn.

Halabi says there are no plans to break up Protractor, although he confirms that he has put New Court a 1 acre island site on Carey Street in the West End on the market through agent Michael Elliott.

‘It is nonsense that I am trying to break up the portfolio,’ Halabi tells Property Week.

‘It is one of the best portfolios in the City of London. We are not highly leveraged and have excellent tenants.’

He said his plans for New Court, which is let to the secretary of state for the environment, transport and the regions, include either redeveloping the site when the lease breaks in 2013 or selling the building at a quoted price of £90m.

‘We have asked Michael Elliott to advise on whether we dispose of the building or form a JV with someone,’ says Halabi. ‘We might do nothing and relet the building.’

Plans to bring in third-party investors to inject equity into Protractor were considered, but have been ruled out.

At the beginning of August Lazards was appointed to look at a bond issue to bring in outside investors. Then the credit squeeze hit, and it was withdrawn from the market.

Kempner has left, as the bond issue will no longer take place.

Halabi says that, while he is content to bank the income from Protractor, he has ambitious future plans for the rest of his London holdings. His most anticipated scheme is his planned redevelopment of the In and Out Club in Piccadilly, formally known as the Naval and Military Club, which he bought in 2000 for around £50m. He plans to redevelop the site into a six-star hotel with an exclusive underground nightclub.

“In my business I have never had a partner in my life. Sometimes partnerships do not work”
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Simon Halabi, Halabi family trusts

In the first concrete sign that development is moving apace at the site, Westminster City Council’s planning committee met yesterday evening to discuss the proposals. In his recommendations to committee members, the planning officer said ‘the proposed hotel use on all sites was considered acceptable in principle’. However, the planning officer also said the committee would have to decide whether the benefits of the scheme overrode some concerns that had been raised. The outcome of the planning committee’s decision is awaited.

Halabi says Buckingham is still working on plans for the 315,000 sq ft Aviva Tower where it has appointed Hamilton Architects and DP9 to advise on planning. A spokesman for the City of London planning department says it has not received any planning application yet.

Plans to carry out short-term leasing of Halabi’s King’s Reach Tower on the South Bank, which is empty after media group IPC moved out in June, are ongoing. However, achieving lettings will be difficult given the building’s worn-out mechanical and engineering infrastructure.

‘We are still looking to let this short term,’ says Halabi. ‘The tenant has not fulfilled its obligations in terms of the lease and we are in negotiations with the tenant and we hope they will come to a new decision.’

An IPC spokesman said it was not aware of any discussions underway with the landlord.

While London’s property market will continue to closely watch Halabi’s movements, it is his plans for the one-third stake in the Shard and the adjacent New London Bridge House that generate the keenest interest.

As Property Week went to press, it discovered that Halabi is on the brink of selling or reducing his stake in the Shard development to a party, rumoured to be the Qatari government, in a deal that could ensure the funding of the £1bn tower. It is thought that the buyer may also be attempting to buy units from Halabi’s joint venture partners CLS Holdings and Irvine Sellar to assume a greater share of the project.

Credit Suisse is still in talks to provide funding. However, a spokesman for Hypo Real Estate International Bank said it was no longer involved in any funding discussions.

Cutting edge news

When it completes, the deal will be good news for Halabi, who has long documented his desire to sell his stake in the Shard and end his involvement in a fractious and litigious relationship with his partners.

‘In all of my business I have never had a partner in my life,’ says Halabi. ‘Sometimes partnerships don’t work.’

Banking sources say the proceeds from the sale, which could yield Halabi a profit of between £35m and £40m, will be used to pay down some of the debt owed to SocGen.

Halabi refuses to comment on any sale but rejects the suggestion that it has been motivated by the French bank.

‘First of all, if I sell the stake in the Shard, it becomes my money,’ he says. ‘I am free to do whatever I want with my money.’

He says that several funding options are being mooted, as the partners seek to fund the tower in a climate of scarce debt because of the credit crunch and rising construction costs.

‘I am not short of money,’ says Halabi. ‘How do you know I might not end up the owner? I might buy the stakes of the others.’

In its August half year results, CLS Holdings said the tower’s funding proposals had been affected by the adverse credit markets and that no development could start until loan finance had been secured. CLS founder Sten Morstedt ratcheted up the pressure on Halabi when

he said banks were putting pressure on the partners to restructure the shared ownership of the scheme and sell Halabi’s stake.

While Halabi’s torrid involvement in the Shard may soon be resolved, his troubles are far from over. Income being used to service bank debt from existing assets does not necessarily equal profit, and the true cost of his Esporta deal is yet to be seen.

Esporta is still in administration and Halabi is negotiating debt repayments with SocGen, which backed the deal with £330m of senior debt. Any sale of the company as a whole or a split between the fitness gyms side and the racquet clubs side is now unlikely to happen before next year. Leisure industry experts say the run-up to December is the most critical time for the fitness industry as subscriptions are set for the coming year and it would be foolhardy to ‘play around with the management’.

Meanwhile sources say that Halabi may ‘effectively lose control’ of Esporta if he defaults on a £30m loan note to private equity company Duke Street Capital thereby activating a clause allowing Esporta’s former owner to assume control of the company.

Duke Street Capital was unavailable for comment but Halabi says: ‘I am still very much the owner of Esporta and my ownership has not been rescinded. We still own it and we are finding a solution with SocGen.’

http://www.usflags.com/images/products/qatar.gif

So the Qatari government not only want to buy Halabi's stake, but also parts of the rest. These guys seem to be very eager on the project. I thought it deserved their flag to be posted :)

So the Qatari government not only want to buy Halabi's stake, but also parts of the rest. These guys seem to be very eager on the project.


... which is why people need to stop posting so many bullshit negative predictions.

... which is why people need to stop posting so many bullshit negative predictions.

:okay: Yes, these billionare developers read our posts and have trouble sleeping at night. Careless words on this thread could see the end of many skyscraper projects. We must exercise our power wisely. :)

Yes, these billionare developers read our posts and have trouble sleeping at night. Careless words on this thread could see the end of many skyscrape projects. We must exercise our power wisely.

i know one very rich developer who does read ssc and thinks the site is brilliant.

‘I am not short of money,’ says Halabi. ‘How do you know I might not end up the owner? I might buy the stakes of the others.’

NOOOOOOOooooooooooooo....

Somebody stop this guy!

i know one very rich developer who does read ssc and thinks the site is brilliant.

I hope he doesn't post negative things about other competing projects. Do you think Halibi posts on here?

SSC is one of the most viewed forums on the Internet -

http://rankings.big-boards.com/?sort=traffic

We get more visitors than some national newspapers. That said, you misinterpreted my earlier comment.

I hope he doesn't post negative things about other competing projects. Do you think Halibi posts on here?

rather amusingly he was developing one tower unaware that the architect for a rival scheme over the road was also posting. i got them together. sweet me!

another interesting one is who do you think reads skyscrapernews. i could tell you but then id have to shoot you, still about 50% of the architects of projects we write abotu get in touch after the fact (even if their PRs ignore me before)

If this project does collapse, then what happens to the rights...the land, the design of the building, etc. Would it be possible for, say the Qatari government to sweep in and buy up everything?

yes they could well do that :)

Hopefully it will not need to come to that, though! As i've said, if they can sort out a fixed price agreement, then as far as I can see, they're sorted.

[QUOTE=gothicform;16120208]rather amusingly he was developing one tower unaware that the architect for a rival scheme over the road was also posting. i got them together. sweet me!
[QUOTE]

You're the Cilla Black of the skyscraper world :D

"SSC is one of the most viewed forums on the Internet -"

Yes but it's only 5 people viewing.:lol:

Most users ever online was 13,724, October 1st, 2007 at 07:47 AM.

Interesting that the Qataris are supposedly so keen on this project, I know that they've recently put another huge project on ice for the time being, (which has upset a lot of bankers hoping to close the deal before the year end and secure a fat bonus).

[QUOTE=gothicform;16120208]rather amusingly he was developing one tower unaware that the architect for a rival scheme over the road was also posting. i got them together. sweet me!
[QUOTE]

You're the Cilla Black of the skyscraper world :D

what are you doing posting during worktime you cheeky scamp? Get back to the graft.

Go LBT - I'm keeping the faith. Fixed priced contracts are risky, look to Multiplex's burnt fingers at Wembley, but they've come back for more at the Pinnacle and back into their home territory of tall towers. Didn't know Laing O'Rourke were particularly experienced in highrises, but happy to be proved wrong.

...I know that they've recently put another huge project on ice for the time being...

What project, may I ask?

You may ask, but I may not tell. If you read the financial press you'd probably be able to work it out. It's not a building project though, so no worries there.

Well, I read the financial press, but mainly for news on this damn tower...guess i'll have to pay closer attention ;)

you mean the Sainsburys and LSE deal? Slightly different markets hopefully...

The Sainsbury's deal doesn't count surely, that deal won't happen 'cos the Sainsbury's won't sell. And I damn well hope it stays that way, Sainsbury's is the best supermarket by far...

what are you doing posting during worktime you cheeky scamp? Get back to the graft.


You gotta love companies that allow working hours access to SSC! :D

Bad news from the Bank of England Financial Stability Review

"Although the overall UK household position is robust, a number of groups might be more vulnerable to a tightening in credit availability,' the Bank warned. It also predicted that equity prices could be hit as corporate borrowing gets dearer, and the commercial property sector could suffer."

a lot of "could"s that everybody knows about since months...

But its slightly more authoritative than the rest, after all interest rate decisions are based on such reports.

But its slightly more authoritative than the rest, after all interest rate decisions are based on such reports.

What we must remember is that, this building will not be ready to occupy until late 2011 at the earliest. The current credit crunch is a short term issue in relative terms, and almost certainly by the time this and any of the other biggies u/c are complete and rentable the markets will have recovered.

What we must remember is that, this building will not be ready to occupy until late 2011 at the earliest. The current credit crunch is a short term issue in relative terms, and almost certainly by the time this and any of the other biggies u/c are complete and rentable the markets will have recovered.

This has nothing to do with the market in 2011 - the credit crunch has meant banks are being more picky about who they give money to today - and the Shard needs a big massive payment to secure its future.

It's far, far more complicated than what people here believe, and has nothing to do with them making back their money in five years or whatever.

We won't hear anything about the Shard until the new year anyway, no bank will be doing a deal as big as this until Christmas is over and we're in a different year.

lets hope we have enough funding to last us until then, or we are going to miss the Olympic games 2012, for this building to be complete! ^^

Not only that we will be looking at a loss of progress on site, and this complicated project could turn out in to the project planning of Wembley. some people treat this 2011 finish date as the date this building is GOING to finish by, dead on time.

It could very easily go forward in time, and seeing how hard it is to get finances for the building, if we were going to go over the budget agreed by the money lenders.This project could be stuck 3/4 complete. we’ve not got the government as the client to inject some more money like at Wembley. we’ve got the private investors who at the moment seem strapped for cash.

I guess we will have to hope the Arab investors become a part of this project to allow us to move forward and complete the shard fully funded to the finish.

we don’t wont to be cutting corners at the end when the aesthetics are being sorted out , as this building needs to be iconic, and to do so needs to be finished to a very high build quality!

We won't hear anything about the Shard until the new year anyway, no bank will be doing a deal as big as this until Christmas is over and we're in a different year.

Well, we'll see, won't we...

It won't be built to half-spec nor will it be half built and left lorn on the skyline; once a deal is done then no-one can pull out halfway through without ending up with massive losses and bad egg on their face. So that's not going to happen.

The tower has gone too far for the whole project to collapse and a smaller building be built in its place. Well, for the moment at least. I see the Shard going two ways. First of all, nothing will be announced until the new year. That is almost certain. We're winding down 2007 now, and the fallout from the credit crunch is still taking its toll and banks are now wary of doing anything to rock the boat somewhat. Even the faux general election malarkey has had an effect on the markets and I think everyone is now batoning down the hatches for winter and hoping to ride out this storm. Demolition, or at least the scaffolding, will continue to rise until Xmas.

Now, come the new year, we'll be in a much better position to ascertain what the market in 2008 is going to do. This is where the Shard will meet its fate. Personally, I reckon the Shard will be built. But it won't be ready for 2012. In fact, this could actually be a good thing, because if the Olympics are a success, London will see its biggest tourist boom post-2012, and the Shard will be an indication London is still moving onwards and to the future and shows confidence that this the place to be. The other option, which may happen, is the increasing price of steel, the trembles in the commercial sector and the prospect that their may not be anyone out there to build the tower simply because there is too much work going on, could mean the project is put on ice- maybe until after 2012 or at least 2011 when the Olympic venues will supposedly be complete. That would mean the tower is completed in 2015.

I doubt Shangri-La would be that bothered by either date. Although Beetham are rushing to get their hotel up and ready pre-2012 I really don't see the Olympics as being the pinnacle of London's tourist boom, it will be summer 2013/14/15 that will see the increase when the people come that weren't willing to be in London during the busy Games but now want to see the city. And either way, London isn't suddenly going to have a down trade in tourism anytime soon, and Shangri-La know this.

For the time being, there's a tower that is coming down either way. That much is clear. But until January 2008 we won't know the exact details of whether this project will continue post-demolition, or whether, for now, the project is put on hold.

Good post, Darjole.

It actually does this tower no harm at all if we don't hear any funding announcements by 2008, as long as they keep up with the effing demolition. Which, I sadly have to say, i'm not altogether sure they are.

Oh Shard I'm tired of waiting, tired of waiting for yooooou:blahblah::blahblah::hammer:

Oh Shard I'm tired of waiting, tired of waiting for yooooou:blahblah::blahblah::hammer:

...........I was a risky project, I had no funding till I met you...but you keep-a-me waiting Mr Halabi, what will you do...?

^^ Yes - It may do the project no harm if we don't hear any funding announcements by 2008, but if you ask me making us wait that long amounts to cruel and unusual punishment. :gaah:

If only Sellar and co could find some money for nothing.

I want my, I want my, I want my L.B.T...

*gets banned*

^^ :lol:

i had a B.L.T for lunch, but id much rather have a L.B.T....

If only Sellar and co could find some money for nothing.

I want my, I want my, I want my L.B.T...

*gets banned*

Oh dear, a Dire Straits quote. How far we have fallen here.

DarJoLe could be quite right about the funding issue. Banks are still v. tentative with their credit. Syndication markets are still rather backed up, and there has been a tightening of commercial property LTVs. We should ride this out. LBT is far too big and important a scheme to die, the consortium won't let it, and it suddenly doesn't become unfundable or uneconomic overnight.

For the time being, there's a tower that is coming down either way. That much is clear.

I'm not so sure. So far work is proceeding very very slowly. Scaffolding doesn't seem to have moved for a week or more. Permanent lighting still seems to be on in the building suggesting the soft strip hasn't started.

At least the tower crane seemed to do a little bit today and it looks like the second tower crane foundation is moving ahead.

Things will be better when we seem some real damage to Southwark Towers. Until then the demolition is not past a point of no return.

http://mysite.wanadoo-members.co.uk/cranesetcphotos/shard13.jpg

Are there still tenants in the building? I saw the site in September and remember being surprised that demolition appeared to be starting yet many floors were still in use.

i dont see the building coming down till after christmas.

i dont see the building coming down till after christmas.

Christmas 2011?

Your'e doing it purpose now!

Christmas 2011?

I thought JamesC was the only negative one :ohno:

Shard demolition work falls six weeks behind

2007 issue 44

By Stuart Macdonald

Further delays to London Bridge tower as Mace fights to keep its role on the £350m scheme

Demolition work on the site of the Shard, the tower that would be western Europe’s tallest, is already six weeks behind schedule, it has emerged.

Work on the building is delayed while its developer, Sellar Property Group, struggles to convince its new Kuwaiti backers that the cost of the 310m building won’t spiral out of control.

A project source said: “A month ago we were raring to go. We were told it’d be three days, then a week. Now it’s six weeks and still the button hasn’t been pressed.

“The demolition contractor [Keltbray] has been holding its team together for as long as it can but it is at the point where it will have to start sending the team to other jobs.”

Keltbray declined to comment other than to say that it was still working on the scheme.

It has also emerged that executives at Mace, the scheme’s construction manager, has been trying to convince Sellar that it can deliver the project within its provisional £350m budget. It is believed that Mace, which avoids taking on fixed-price contracts, is prepared to offer a fixed-price deal to retain its place.

Mace’s position as construction manager on the scheme is understood to be in doubt. The source said: “The new backers are not happy about the risk of construction management.”

Last week it emerged that Laing O’Rourke, which had been bidding to take on some of the Shard’s superstructure work, was in discussions with Sellar over a possible fixed-price deal for the whole project. The contractor has now moved staff into the project’s site offices at London Bridge.

A spokesperson for Laing O’Rourke said it was “in discussions” with Sellar. It is understood that the contractor has not yet been appointed to do anything on the scheme.

interesting... Kuwati backers now too

interesting... Kuwati backers now too
Maybe just an error in the reporting.

Yesterday, the Renzo Piano Shard was here to stay,
now it looks as if it's goin' away
Oh I believe in yesterday!

Why It takes so Long, I don't know,
will someone say
I keep hanging on,
how I long for yesterday ay ay ay...

Maybe just an error in the reporting.



I think they probably meant Qatari....but in any case...It means they have new backers...these are the salient points I think. Quote: 'The source said: “The new backers' :)

Also, it appears that contractors are fighting over the right to be appointed to the project :) :)

Quote:'It is believed that Mace, which avoids taking on fixed-price contracts, is prepared to offer a fixed-price deal to retain its place.'


'Last week it emerged that Laing O’Rourke, which had been bidding to take on some of the Shard’s superstructure work, was in discussions with Sellar over a possible fixed-price deal for the whole project. The contractor has now moved staff into the project’s site offices at London Bridge.'

To me, this appears to be just finalising negotiations over a project....a project that will certainlygo ahead.

Agreed Mulattokid. To me, that is good news.

Do you think they have bought Halabi's stake and we are just waiting for confirmation.

I love the way it looks like people are fighting eachother to get a piece of this project, yet the journalists still try and spin it all in a bad way and put the focus on a demolition delay.

iv never doubted this project, this seems like positive news, and if mace dont scratch up then laing o'rourke will step in, and they managed and built the newer severn bridge didnt they?
And it sounds like halibi may have sold off his part on the quiet too, with the 'new backers' already giving their advice about mace. sounds good. now i just want to see tangible evidence in the next few weeks that demolition will continue, Keltbray wont wait forever.

Shard demolition work falls six weeks behind

Demolition work on the site of the Shard, the tower that would be western Europe’s tallest, is already six weeks behind schedule, it has emerged.

Work on the building is delayed while its developer, Sellar Property Group, struggles to convince its new Kuwaiti backers that the cost of the 310m building won’t spiral out of control.

A project source said: “A month ago we were raring to go. We were told it’d be three days, then a week. Now it’s six weeks and still the button hasn’t been pressed.

This is one case where I would much rather not have been proved right...

^^ Yeah I don't get it. Demolition six weeks behind schedule and people are still managing to read between the lines and say "actually this is good news".

well, i would simply say there's good and bad news at the same time here.

Many doubts were proven right about the progress of the demolition. And that increases doubts about the project, because why should they delay demolition if it was so certain to go forward.

At the same time it sounds like earlier rumours about new investors have solidified and that it seems not to be as hard as expected to find a fixed price contractor if Mace is really trying to beat out the new contender for that.

^^ Yeah I don't get it. Demolition six weeks behind schedule and people are still managing to read between the lines and say "actually this is good news".

many people feared this would be the end of the project.

It's been delayed yes, but from all the quotes above looks more likely to go ahead than not IMO

^^ Yeah I don't get it. Demolition six weeks behind schedule and people are still managing to read between the lines and say "actually this is good news".

New backers? Contractors fighting to get onto the scheme, willing to bend their usual practices just for this job?

How in the name of HELL is that reading between the bloody lines? Sorry, but why are some people here so fracking negative?

Yes there was some bad news, but there is good news there too. Why do some people fail to see that? I mean for god sakes we knew it was behind schedule, with the length of time it was taking you would have to be retarded to think otherwise.

Everything is being finalised. That's what all the signs point too. Why are some people so petrified, acting as if it was the end? Becasue of a couple of delays? We have had delays for years. This is what happens with big projects, deal with it.

We had the exact same fracking thing when UNESCO stopped by. "There will never be another tall proposal in London again!!!"

I think I'm seriously starting to go mad here. The negativity and scare mongering of the media seems to be starting to have an effect. There has been loads of good news recently, on other projects and this one, we discovered a hugely wealthy backer is lined up and may now even be in place, yet people still seem sure it will never go ahead.

I need to stay off this thread for a little while. Call me when it starts.

eeee, this is a complete rollercoaster of a project. I think you can take positives out of that new story to be fair. Mace don't want to loose such a massive project, Laing O'Rourke are keen to get their nose in there....... No one is going to sign up to a fixed priced contract that will be unattainable. They will be doing their sums, and if its too big an ask by the developers, the contractors will drop out. That doesn't seem to be happening. What chance a late run by Multiplex....... (none whatsoever!).

The Halabi story has gone quiet, but you never know, might have been all secret squirrel and now resolved........ how nice would that be. \

Don't understand the demolition delay - the towers still need to come down, and Keltbray have the contract in the bag.

Don't understand the demolition delay - the towers still need to come down, and Keltbray have the contract in the bag.

Could it be that if the project is not going ahead then the developers simply keep Southwark Towers (perhaps refurb it) and pay Keltbray considerable compensation? Afterall Keltbrays contract is worth less than £100m (?), it would surely cost more to go through the planning stages again with a different building and build it.

I am certain this project will go ahead, there is serious money to be made from The Shard, anyone can see this surely. This will be a very high profile development and people will start asking 'who is building that??' when it starts reaching 200m+ and those involved will be loving the attention.

Everyone should remain positive!!

Could it be that if the project is not going ahead then the developers simply keep Southwark Towers (perhaps refurb it) and pay Keltbray considerable compensation? Afterall Keltbrays contract is worth less than £100m (?), it would surely cost more to go through the planning stages again with a different building and build it.

I am certain this project will go ahead, there is serious money to be made from The Shard, anyone can see this surely. This will be a very high profile development and people will start asking 'who is building that??' when it starts reaching 200m+ and those involved will be loving the attention.

Everyone should remain positive!!

The Keltbray demolition contract is apparently worth £8m. Seems rather small, but Cranesetc posted a list of demolition contract values some time back. The most expensive were Bucklesbury House (its huge), and 20 Fenchurch Street - (its tall and rather complicated).

I doubt anyone would want to rent in Southwark Towers even with a bit of a refurb.

I don't know what publication the article london lad posted came from. I hope it indicates that Halabi has sold up, but frankly I'm not going to place too much weight on the words of a reporter who gets Kuwait and Qatar mixed up...

it was building.co.uk

Both Building & Propertyweek are pretty reliable for stories. Although things are on hold for the minute its quite positive that Laing O'Rourke are keen for the contract even though its a fixed contract & its even more positive that Mace don't want to lose the contract so they must both be quite positive that this project will get going .

scaffolding is about half way up the back of the building, its gone up really quick

yeah noticed that this morning, so took a pic, not many workers around though

http://xs221.xs.to/xs221/07455/lbt.JPG

I'm just waiting for the white sheet of death to be pinned up! :)

their were about 5 people on the top tier putting up scaffolding at about 8.45am when my train got to london bridge.

I'm just waiting for the white sheet of death to be pinned up! :)

so am i waiting for the white sheet of death.:lol:

It was time starting demolition and finally see the tallest building in London and in Britain going up! can't wait to see the project finished. It will be such a great addition to the continiously growing London City skyline.

scaffolding is about half way up the back of the building, its gone up really quick

well hopefully they'll now get their skates on and make up lost time! good to see something happening again.

I'm just waiting for the white sheet of death to be pinned up! :)

Hey...where have you been? :banana2: Back just in time to see that us positive forumers where right afterall :)

In my years since discovering a bunch of crazy people on the internet who share my love for skyscrapers (and becoming one), "White Sheet Of Death" is definately the funniest, most appropriate and memorable phrase I've picked up. My life is fulfilled!

In my years since discovering a bunch of crazy people on the internet who share my love for skyscrapers (and becoming one), "White Sheet Of Death" is definately the funniest, most appropriate and memorable phrase I've picked up. My life is fulfilled!

Should "sheet" be substituted by "shroud"?

I think shrouds are aways white....how about the bodybag of dispair....or cocoon of the progress moth.

OMG, actual progress!! :eek:

OMG, actual progress!! :eek:

Well slow progress!

if there was more progress there would be the white sheet of death on it by now!

Lots of rumours in the industry over the last few days that the project has been 'shelved' indefinitely. As these rumours are coming from people very close to the project I tend to think they are valid.
The great 2010 office space bubble has proved to be false and London will have too much office space by then.

At least one of the towers was no going to go ahead and it looks like the first to go is LBT.

Awww.

Oh...sounds bad...:(

The Shard already has two significant pre-lets and despite its size it doesn't have a huge amount of free floorspace. I can't believe this wouldn't go ahead because of a surplus of office space.

Well thats that, goodbye LBT :ohno:

im sure london bridge tower will be built as building going to be hotel and offices.most big law firms and financial company need office space.

Well thats that, goodbye LBT :ohno:

well lets not throw in the towel all too quickly - up to now all we have is rumors. Both positive ones - if the Quatari government is really on board and even interested in increasing it's share that would mean they don't believe in an abundance in office space and the project would go ahead - as well as negative like this one

Seems like the usual suspects almost gleefully prophesising the demise of this tower. Maybe they thought everyone was getting a little too optimistic??:hm:

Rumours are rumours nothing more.

Well thats that, goodbye LBT :ohno:
Cover your ears children....do fuck off why don't you, I have yet to see a constructive or halfway decent comment from you on this site. We've been hearing good and bad rumours for months now, so untill official word is given either way, positive or negative, hold your tongue.

http://www.skyscrapernews.com/news.php?ref=1110

i know a similar article was posted here already and its a bit outdated, but due to the newest worries about the project i want to remind of this key phrase about the Quatari investment:

"They weren't alone in expressing interest in the scheme, the American financial institution Pramerica had also expressed an interest but were outbid by their Arab rivals."

Obviously that means that not only was Quatar strongly motivated (in contrast to todays claims of too much worries about an abundance of office space) in this development but also that in case Quatar would jump off we would have another investor (Pramerica, as wjfox2002 has already pointed out in the past, but apart from that this important fact wasn't really discussed yet up to now) to jump in

Lots of rumours in the industry over the last few days that the project has been 'shelved' indefinitely. As these rumours are coming from people very close to the project I tend to think they are valid.
The great 2010 office space bubble has proved to be false and London will have too much office space by then.

At least one of the towers was no going to go ahead and it looks like the first to go is LBT.


If office space is oversupplied its the poorest projects that are likely to struggle to attract tennants, not one of the most prestigeous in Europe.

To me thats common sense, but hey...I didnt claim to here the rumours.

In the spirit of adding to the baseless speculation that typifies threads that are short of news, I would like to say the following:
Oh no!! The LBT is definitely cancelled! Boo-hoo!!! Oh, hang on, I've seen some scaffolding...it's back on! Hooray! What an awesome addition to the skyline! Oh - what was that? Another rumour from "someone close to the project"? Oh no - it's cancelled! .....[continue ad infinitum]

Is the Southwark Towers going to be demolished anyway or will the scaffolding be dismantled and the building put up for new tenants? Anyone know what is going to replace the LBT, any new renders? Shame about the LBT, I really loved that building.

oh JamesC you do make me shrilly laugh out loud - a bit like a woman I fear

this is all a bit like the rumors surrounding the appointment of the new Leicester City manager where the tea lady and the turnstyle man are all 'adding their penneth worth' lets wait for official news.

Assuming the Southwark Towers are demolished to schedual and BLT won't be built what will happen to the site? Will the BLT be on hold? Like Columbus Tower?

Assuming the Southwark Towers are demolished to schedual and BLT won't be built what will happen to the site? Will the BLT be on hold? Like Columbus Tower?

if the project wasnt going to happen then they wont demolished the building. if they putting scaffording up seem the project is happening.

I was under the impression the demo. contract was awarded and Southwark Towers was coming down regardless of whether LBT will be built?

I Think JamesC was born at the exact moment someone applied for a Mint Card....and thus the clever/dumb balance was restored...

im just hanging on for some official news now, but its dragging on a bit thats for sure...

if the project wasnt going to happen then they wont demolished the building. if they putting scaffording up seem the project is happening.
Is scaffolding still going up, has anyone checked lately? If the building is coming down anyway why is demolition so slow?

People that are very close to the project saying it’s been shelved, them it must have.

Do you think realistically that this project is going to happen before the London development bubble bursts? It is very scare how these projects are born and die. The stage of development is also not important at all... If the numbers don't add up... bye bye... Years of effort down the drain... (cross fingers though)

Well usually when you see a core rising its happening.

Those that know me and laugh at my going off topic....lets be honest..anything is better than thread at the mo, with its: ' Oooh Mrs osnevoucher...tis true his cup floweth over bountifully'. "It doth not Mistwress Stwrump!, verily it does not!'

I think this thread should be locked in a time capsule for a few months

Halabi with some new money? Or closer to being forced to sell his share of the Shard? The Daily Telegraph reported today that Esporta the fitness chain bought by Halabi has been put up for sale. It could mean that Halabi will get a cash injection or end up with a big loss... but he no longer appears to have control of the situation.

Those that know me and laugh at my going off topic....lets be honest..anything is better than thread at the mo, with its: ' Oooh Mrs osnevoucher...tis true his cup floweth over bountifully'. "It doth not Mistwress Stwrump!, verily it does not!'

I think this thread should be locked in a time capsule for a few months

:D

Halabi with some new money? Or closer to being forced to sell his share of the Shard? The Daily Telegraph reported today that Esporta the fitness chain bought by Halabi has been put up for sale. It could mean that Halabi will get a cash injection or end up with a big loss... but he no longer appears to have control of the situation.

Here's the link: http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/11/13/cnesporta113.xml

Meanwhile QIA's still into EADS (http://www.reuters.com/article/tnBasicIndustries-SP/idUSL1343620120071113), possibly buying Peacocks (today's news - http://icwales.icnetwork.co.uk/business-in-wales/business-news/2007/11/13/bahrain-investment-fund-to-swoop-on-peacocks-chain-91466-20098589/), dropping Sainsbury's, etc.

It's all interesting enough, but it doesn't add up to any concrete news on the Shard at all.

No news is no news.

I think I am resigned to the fact that we will not get any firm news on this either way before the year end. It certainly puts a bit of a downer on what otherwise has been quite a successful year in terms of big developments moving forward.

If office space is oversupplied its the poorest projects that are likely to struggle to attract tennants, not one of the most prestigeous in Europe.

To me thats common sense, but hey...I didnt claim to here the rumours.

absolutely my point. LBT is quite surely the most prestigious project in London and probably even for the whole of Europe. Both in terms of size but also in terms of an "icon" like design only rivaled by the (however not much more than half as tall) Gherkin.

And the only real recent news which made it on paper (in serious publications like Financial Times) was the one about Quatar involvment in this and that they even had to outbid another contender. There is simply too much prestige (and that does make a difference, especially for Arab investors) on offer here for this to be put to the shelves.

On top of that there are significant prelets unlike for some of the current city projects which are 100% speculative builts, so also from a financial/economic perspective this looks like a safe bet.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/11/13/cnprop113.xml

'Building up troble for the future' online article:

Mace to build Shard for fixed price

15 November, 2007

By Sarah Richardson

Construction manager to beat Laing O’Rourke to £350m landmark tower at London Bridge

Mace is set to be appointed to build the Shard for a fixed price, the first big deal of its type in the company’s history.
Shard

It is understood that Mace is in exclusive talks with developer Sellar Properties over a deal worth more than £350m after Laing O’Rourke walked away from the project.

Mace was originally expected to build the Shard under a construction management deal, but concerns over funding led Sellar to approach Laing O’Rourke to ask about a fixed-price contract.

A source close to the talks said: “It’s all change. The direction is now to negotiate with Mace to arrive at a fixed-price deal. Sellar has been in numerous meetings with them.”

The source said that a fixed price for the deal had not yet been agreed, but that figures being discussed were “£350m and upwards”.

Although Mace has previously worked on small fixed-price deals, it has never carried out a major project under the procurement route.

Laing O’Rourke is believed to have got cold feet after realising that Mace was keen to compete for a fixed-price deal.

Meanwhile, sources on the project said that although demolition work was proceeding, it was doing so “very slowly”.

It emerged earlier this month that the demolition programme had already fallen six weeks behind schedule as the developers sought to finalise funding for the scheme, with developer Sellar Property Group struggling to convince its new Kuwaiti backers that the cost of the building will not spiral out of control.

Mace and Laing O’Rourke declined to comment.

yeah i got that release too about mace winning. good news!

Oh delicious! Just what we needed to hear! Again though Kuwaiti backers are mentioned...

very promising news. a reasonable chance we should get some real clarity soon then.

i love the line about demolition progress - it's lucky there are such well-placed sources on the project, otherwise we'd never have noticed things were moving slowly...

good news for a change

Bit more news on this in construction news_

MACE will do the below ground works by construction management & the work above ground will be £250m fixed price so satisfying anxious bankers. This is the same situation MACE have with the pinnacle.

The rollercoaster takes us up again, good.

Looking forward to another classic comment by JamesC :)

Bit more news on this in construction news_

MACE will do the below ground works by construction management & the work above ground will be £250m fixed price so satisfying anxious bankers. This is the same situation MACE have with the pinnacle.

Sounds reasonable. The risk cost-wise is unexpected/unanticipated additional costs related to ground works, once that is completed the above grade works should be highly predictable.

Prestige wins the day :banana2:

A reason for cautious optimism perhaps. But lets not get the dancing bananas out just yet....

wonder if the chap from Mace who took Foxy, mulattokid, Smoggie, exBass and myself up the Willis Building (so to speak). Think he was called Steve..... I may dig his e mail address out and drop him a line to see what the score is.

Another snippet of positive news, steady does it.

I walked by it again today, no more scaffolding put up either on the back or the front. Lazy workmen, the usual. Good news about MACE though :)

Oh delicious! Just what we needed to hear! Again though Kuwaiti backers are mentioned...

probulary a misprint :lol:

Bit more news on this in construction news_

MACE will do the below ground works by construction management & the work above ground will be £250m fixed price so satisfying anxious bankers. This is the same situation MACE have with the pinnacle.

I thought Multiplex are building the pinnacle?

I thought Multiplex are building the pinnacle?

they pulled out

A fixed price in a rising market is very sensible and probably what this project needs right now.

Surely this has to be seen as good news?

Now can't they get a bloody move on with the demolition...?

I thought Multiplex are building the pinnacle?

they are - separate packages I guess, one for substructure and overall project management, the other for construction of the main superstructure. I think this is a familar working model. Lumiere in Leeds is having substructure done by Skanska, but superstructure (i.e. above ground) by Carillion.

Don't anyone start spreading rumours about Multiplex, they've announced this to the world and have 15 people on site prep work already according to the press releases earlier on the Bishopsgate thread.

they pulled out

that's plain wrong mate, read the post above this one.

Dont be so pessimistic - it will get built some time in the near future!

A poll on Contruction News at the moment...

Will the Shard ever get built?
Yes 77%
No 23%

http://www.cnplus.co.uk

I think Mace are the project manager on Pinnacle, with Multiplex on a pre-construction agreement to become the main contractor.

Walked past the site today, and it was nice to see plenty of activity on site,the scafolding was being errected by atlest 3 people, and noises could be heard from inside the building

A question: Would Ken Livingstone be able to drop the affordable housing quota for this project substantially? It would have a seriously positive impact on the IRR. But then would he dare to set such a precedent? Sure, the Shard would be a monument, but what would he say to the developers of Battersea Power Station? And what would public opinion say? Or should he not care about that, because the anti skyscraper lobby is not expected to vote for him anyway?

Interesting. He would probably get away with it, the press and conservatives jumped on the Transport for London office deal but it soon blew over and no one really cared as it was all caught up in the banality of property dealing. I doubt if developers would let him get away with it though, imagine them all running to the teacher to point fingers.

A couple of nice articles from this month that round up a few tens of pages of discussion quite nicely... I dont think they have been posted before

Where, potto, where?

http://i14.photobucket.com/albums/a331/tijjan/lbt.jpg

I WANT MY I WANT MY I WANT MY LBT.

The top headline in this morning's EGI -

"Sellar makes further Shard allegations"

Can anyone access the full story??

ohhh thats a sexy image.

The top headline in this morning's EGI -

"Sellar makes further Shard allegations"

Can anyone access the full story??




Sellar makes further allegations in £55m Shard wrangle

Christian Metcalfe 23/11/2007 09:45

Irvine Sellar has made further allegations of negligence as he pursues a £55m claim against the lawyers that acted for him on the 1998 purchase of the Shard of Glass site.

Sellar is already pursuing a claim that Nicholson Graham & Jones was negligent in drafting the original joint venture agreement for the £39m acquisition of the site - next to London Bridge station - between himself, CLS Holdings and Simon Halabi.

He claims that the draft negligently gave Halabi a controlling half-share in the site when the Syrian investor should have only been given a one-quarter share.

An April 2001 "rectification” agreement subsequently reduced Halabi’s share in the site.

The latest allegations relate to the lawyers' advice with regards to the "rectification" agreement, which prompted a bitter dispute between Sellar and Halabi in the Jersey courts in March 2004.

Halabi claimed that his stake had been wrongfully reduced from one-half to one-third without his consent, while Sellar alleged "fraudulent misrepresentation" against Halabi.

Sellar claims that, had it not been for Nicholson Graham & Jones's allgeged negligence, he would not have incurred the substantial costs of the Jersey proceedings and a 2005 out-of-court settlement.

He alleges that NGJ should have advised that Halabi had to consent to the rectification and that it had to be the subject of a formal contract between Halabi and the other joint venture partners.

Sellar adds had that advice been given the rectification would not have been susceptible to challenge by Halabi on any basis .

Nicholson Graham & Jones, now part of K&L Gates, said it is vigorously defending the claims but declined to comment further.

christian.metcalfe@rbi.co.uk

www.egi.co.uk

Oh dear.

they may as well all be in the children's playground. It's my project, NO it's MINE!

They all need to get a life.

Oh dear.

they may as well all be in the children's playground. It's my project, NO it's MINE!

They all need to get a life.

If they don't stop the whining there won't be a project for anyone to claim as their own.

Nice to see her being used as symbols of London already! http://xs221.xs.to/xs221/07475/lbt.JPG

From Construction News
http://www.cnplus.co.uk/News/mace_in_unexpected_shard_of_glass_return.html

Mace in unexpected Shard of Glass return
Published: 14 November 2007 17:48 Author: David Rogers More by this Author Last Updated: 19 November 2007 14:51


Laing O'Rourke cools on idea of taking over country's tallest tower
Mace looks set for a dramatic return to the Shard of Glass in London less than a month after it seemed to have lost the contract to Laing O'Rourke.

The news caps weeks of confusion over who will build the country's tallest tower, which will stand at 310 m high when it is eventually completed.

Mace's future on the scheme looked to be over when the Teighmore development team ditched the previous construction management route in favour of a fixed-price deal.

The decision was made after banks told Teighmore they wanted more price certainty on the scheme and were unwilling to bankroll it under CM.

Teighmore, which is led by Sellar Property, asked Laing O'Rourke to look at the scheme, which chairman Ray O'Rourke agreed to do under an exclusivity basis.

But Construction News understands that O'Rourke had cold feet, paving the way for a return by Mace.
One insider said: "Laing has a 'take it or leave it' view and there's plenty of work about, so they don't need this job at all costs. No one is going to put their head on the block unless the price is right."

Mace privately insisted it would not take Teighmore's decision lying down and began putting together a package it thought suitable.

Mace's proposal will see it carry out the £100 million substructure and groundworks package under CM, with the above ground work, which carries a price tag of £250 million, built under a fixed price.
Teighmore is believed to have contacted Sir Robert McAlpine and Skanska after O'Rourke began to waver but was told by the pair that they weren't interested Đ strengthening Mace's position.

One insider said: "The whole thing has been an absolute -fiasco from a PR point of view. It looks like Sellar's come full circle after turning down Mace, getting Laing on board without signing them up and then getting Mace to carry on what they've been doing.

"But you can look it like this. Sellar has got a fixed-price contract for the bulk of the work."

Mace, expected to have a turnover of £500 million this year, traditionally carries out work under CM and some have wondered whether it has the financial clout to carry out a job of this size under fixed-price.

But one expert said: "They're doing £250 million on fixed-price which is over something like three-and-a-half years. That's less than £80 million, so Mace will say it's not that big a risk for it."

Demolition work, due to be carried out Keltbray, has still not started because of the funding impasse. Construction is due to take 40 months. It is set finish in September 2011.

Pinnacle provides inspiration

Mace has borrowed what it hopes will be the winning solution to its Shard problems from the building's rival – the Pinnacle.

Everything up to slab level on this job, which carries a £500 million price tag, is being carried out under construction management – by Mace.

Fixed-price will be used when Multiplex begins main construction work early next year.

The Pinnacle is being planned as the tallest building in the country – until the Shard is built.

Unlike the Shard, the Pinnacle, which will be built at Bishopsgate in the City of London, actually resembles a construction site.

It will stand at 288 m high when it is completed in 2010.



It sometimes pays not to throw in the towel

It pays to be pragmatic in construction. Mace has been put through the wringer in recent weeks after it became clear that its future on the Shard was up, when developer Teighmore said it needed to be done under a fixed-price deal.

Laing O'Rourke was the firm being lined up but it then threw a spanner in the works when it said it might not be too interested in the job after all.

Meanwhile, Mace decided to do something about its impending demotion and put forward a proposal that it thought might work.

It would use construction management for the more tricky stuff in the ground, with the logic being that this method offers more transparency than fixed price in an area traditionally fraught with risk. It could also be cheaper, with firms not overloading their price to take account of unforeseen problems.
Above ground it would use fixed-price, so satisfying those anxious bankers.

The whole thing has been clumsily handled by the developer, of course, but in the end it pays the bills.

http://www.cnplus.co.uk/News/why_lenders_will_push_for_fixedprice.html

Why lenders will push for fixed-price

Published: 21 November 2007 13:47 Last Updated: 21 November 2007 13:49
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When the market is shaky clients tend to prefer the certainty of fixed-price contracts, says Richard Kelly
Rarely can the contractual arrangements between a client and a contractor have caused as much interest as those surrounding the Shard.

The recent speculation over the fixed-price versus contract management nature of the Shard construction contract brings into sharp focus the position of lenders with regard to funding major development projects.

So why are lenders more willing to lend under fixed-price arrangements in the current climate?

In broad terms, the problems in the credit markets have caused banks to worry about selling their debts on to other lenders as no-one is exactly sure who will end up footing the bill for the bad sub-prime loans.

Banks are therefore lending from their own books and will be increasingly more interested in the ability of the ultimate borrower to repay the loans.

And, as with most things financial, it's all about current attitude to risk. Lenders will only view the risk and return of projects through the prism of their own expectations.

It's probably safe to say that expectations aren't what they were.

Good old fashioned fixed-price contracts place the construction risk firmly at the door of the contractor. If the project overruns, then the contractor, by and large, foots the bill.

Inflationary pressures remain in the construction sector. Build cost inflation, both in terms of labour and materials, outpaces consumer inflation.

Given the significant pipeline of major developments, particularly in the south-east, there can be no certainty that the heat will come out of cost inflation.

Fixed-price contracts help shield the client, and consequently the lender, from the risk of that cost overrun.

Contract management agreements on the other hand can balance risk in a more even-handed way.

Who takes the risk?

In good times, when confidence is high and there is plenty of money competing to fund development, lenders may be more willing to share the construction risk.

In less certain times, when there is a shortage of money, lenders worry about cost inflation and start to fear that they may be overly committed in the sector. In this situation the balance of the construction risk is readily placed back onto the contractor.

All very straightforward for the bank perhaps, but what happens to the contractor left to shoulder the majority of the construction risk?

Naturally they seek to protect themselves, so they build in their own expectations of rising costs into the tender price.

They try to increase the time available to complete in order to meet performance guarantees and build in their own increased finance costs and increase their own risk premium.

So round and round the cost pressure cycle goes again - illustrating why perhaps contract management or some form of risk sharing was so attractive in the first place.

Richard Kelly is head of construction at accountant BDO Stoy Hayward

Sellar makes further allegations in £55m Shard wrangle
Christian Metcalfe 23/11/2007 09:45

Irvine Sellar has made further allegations of negligence as he pursues a £55m claim against the lawyers that acted for him on the 1998 purchase of the Shard of Glass site.

Sellar is already pursuing a claim that Nicholson Graham & Jones was negligent in drafting the original joint venture agreement for the £39m acquisition of the site - next to London Bridge station - between himself, CLS Holdings and Simon Halabi

He claims that the draft negligently gave Halabi a controlling half-share in the site when the Syrian investor should have only been given a one-quarter share.


An April 2001 "rectification” agreement subsequently reduced Halabi’s share in the site.

The latest allegations relate to the lawyers' advice with regards to the "rectification" agreement, which prompted a bitter dispute between Sellar and Halabi in the Jersey courts in March 2004.

Halabi claimed that his stake had been wrongfully reduced from one-half to one-third without his consent, while Sellar alleged "fraudulent misrepresentation" against Halabi.

Sellar claims that, had it not been for Nicholson Graham & Jones's allgeged negligence, he would not have incurred the substantial costs of the Jersey proceedings and a 2005 out-of-court settlement.

He alleges that NGJ should have advised that Halabi had to consent to the rectification and that it had to be the subject of a formal contract between Halabi and the other joint venture partners.

Sellar adds had that advice been given the rectification would not have been susceptible to challenge by Halabi on any basis .

Nicholson Graham & Jones, now part of K&L Gates, said it is vigorously defending the claims but declined to comment further.

christian.metcalfe@rbi.co.uk

Courtesy EG i News

Some good news atlast.....

ES reports that the Qatari deal has been done and that the news will be officially announced next week.

Start warming up those bannans.........:)

^^ (aiming at mulattokid's post - the EGI article) Does anyone know if the negotiations on the way forward for the Shard's development are insulated from that dispute (in which case it's of peripheral interest to us), or if it might hold things up further (which I fear would be pretty bad news)?

Some good news atlast.....

ES reports that the Qatari deal has been done and that the news will be officially announced next week.

Start warming up those bannans.........:)

The ES, as in the Evening Standard? They aren't exactly known for their accuracy. If true, this is stupendously amazing news - but I'd rather hear it from a more trusted source like EGI, Property Week, etc...

Small piece in tonight's Standard, nothing new but a positive outlook;

Peter Bill on Property.

Might the Shard now be built? Happy rumours are circulating that the 1016-foot tower that is planned above London Bridge Station is about to be rescued by Middle East money...
the word is that the Middle East buyer will take control. And that next week they will tell the world (and the waiting builder) that work can start.

... rumours are circulating that ...

Just as I thought... :|