ING Real Estate pulls out of high-rise residential project in Brighton

Permalink: ING Real Estate pulls out of high-rise residential project in Brighton
by Lin Freestone

ING Real Estate has withdrawn from a funding agreement for a mixed-use development designed by Frank Gehry which was planned for construction in Brighton. The £250m King Alfred residential complex, which was granted planning consent in March 2007, comprises 751 flats across two towers and several smaller blocks.

Karis Holdings, a joint venture between Karis Developments and ING Real Estate, has been working closely with Brighton & Hove City Council to realise the plans for a new sports facility funded by the development on the site of the residential towers and surrounding residential blocks.

ING Real Estate has said that the volatility of the money markets, along with the escalating material and construction costs, and the downturn and uncertainty in the residential market, have had a major negative impact on the viability of the scheme.

In the current circumstances the scheme does not perform against ING’s target criteria and therefore the company has regretfully decided to withdraw.

Karis Developments now has sole control of Karis Holdings and aims to bring in another investor to take the scheme forward. The company remains committed to the King Alfred project, which includes an £80m sports centre, small shops, a police office, a GP surgery, cafes, restaurants and public spaces.

Karis is now talking to other investors and is having to look at how to make the scheme viable. A potential investor has an opportunity to invest in a scheme where most of the hard work is already done and £13m has already been spent.

Anecdotal reports suggest that possibly half of all high-rise residential developments are being put on hold at various sites throughout the UK awaiting an improvement in the housing market.