Can London carry on reaching for the sky?

Dubai has managed to complete the Burj Khalifa, now the world's tallest building, despite its financial crisis. Plans to transform London's skyline have been less immune to recession

Will London ever see the sort of amazing fireworks launched this week in Dubai to celebrate the official opening of the Burj Khalifa tower? Britain may never have had plans on the scale of the Burj, which at 828m is the world's tallest building by some margin, but we did once have ambitious ideas about how new skycscrapers might transform London. Buildings with nicknames such as the Shard, the Cheese Grater, and the Walkie Talkie were supposed to change the the skyline of the capital – and to serve as metaphors for its prosperity and wealth.

The financial crisis of the last couple of years has made the once buoyant commercial property companies think again, with groups like Land Securities and British Land opting to check plans for their most outrageous projects.

Only three of the outstanding ventures – the Shard, a scheme known as the Helter Skelter and the Heron Tower – remain on schedule (incidentally, two are owned by Middle Eastern investors), with the others, for now, falling victim to the fallout of the credit crisis.

The subsequent recession led to a 45 per cent fall in commercial property prices in some parts of London and with the financial sector paring back expenditure to save costs, demand for office space is only just starting to recover, say industry analysts. "In central London, we have seen a better year than expected in terms of letting activity given that the UK economy has suffered the worst recession in over 60 years," a spokesperson for CB Richard Ellis, the property consultancy group, said yesterday.

"Buoyed by a number of key deals, largely concentrated in the City market, major occupiers have been keen to take full advantage of the significant incentive packages on offer close to or at the bottom of the cycle. Looking ahead, as supply falls, exacerbated by the halt in speculative development activity coupled with the pick up in overall demand, we should see rental values recover in 2010 and beyond."

Indeed, the property investment groups have reported an uptick in business in recent months, but there is little enthusiasm, they say, for some of the more ambitious projects. According to Land Securities, rental demand is stronger in the West End, but that is unlikely to lead a wholesale change in the appearance of the London skyline, especially as London's Mayor, Boris Johnson, argues that skyscrapers should only be built in areas where other tall buildings already exist.

Land Securities, the group behind the Walkie Talkie, concedes it has "no committed timetable for taking the [Walkie Talkie] project forward." They are not alone, meaning that plans to dramatically alter the appearance of London's skyline have been indefinitely shelved. The fireworks will have to wait too.

Additional reporting by Joe Rennison

Capital heights: The landmark buildings planned for the city

The Shard

The skyscraper at London Bridge is so called because it will resemble a shard of glass when its 306m (1,004ft) tower is finally finished next year. Of all the ambitious projects launched during the boom before the commercial property sector imploded in 2008, the Shard appears to be one of the few to have survived unscathed.

The lower floors of the structure are already appearing above London Bridge Station. The Shard was intended to be Europe's tallest building – before plans for two skyscrapers in Moscow were unveiled. It is owned by a collection of Qatari investors and designed by the Italian architect, Renzo Piano. The Shard, which has replaced Southwark Towers, a 100m tower built in 1976, will become the new home of Transport for London.

Walkie-talkie

One of the most innovative, or oddest, designs for a new London skyscraper (depending on who you speak to) is Land Securities' planned "Walkie Talkie", a £200m project that won planning consent in 2006. The approval was granted only after the designs were altered, following protests that the 200m (656ft) tall structure would detract from views of St Paul's Cathedral. Land Securities said yesterday that there was no definite date when construction work might begin.

Cheese Grater

Like the "Walkie Talkie", there are few signs that British Land's "Cheese Grater" is likely to be built soon. Initially, the group planned to complete the tower by 2011 but it announced in August 2008 that plans for the building at 122 Leadenhall Street in the City of London had been put on hold. A source close the company confirmed that British Land had no immediate plans to resurrect the project, saying the commercial property sector in London was still far too precarious.

Battersea Power Station

One of the most famous buildings in London, and used by the Bank of England during the Second World War to burn £120m in banknotes to prevent forgery, the plant on the south side of the Thames has seen better days. Several developers have failed to do anything with the site since it ceased producing electricity in 1983. Treasury Holdings wants to transform the area with flats and a shopping centre; the chief problem is transport. Positive noises have been made but, with expected cuts in public spending, the Mayor's office said yesterday that any transport link would have to be privately funded.

Heron Tower

When completed in 2011, the tower will stand 242m (794ft) tall and spend a brief spell as London's tallest building, until the The Shard is completed in 2012. Despite the Bishopsgate project not yet being finished, it is already the tallest building in the City, having overtaken Tower42 in early 2009. The joint venture between Heron International and two other independent investors is a fully-funded, fixed-price development that, unlike most, remains on budget and on schedule for completion.

Heron Quays West

One of the most remarkable changes to the London skyline since the Luftwaffe arrived in 1940 was the redevelopment of the Docklands into a financial district to rival the predominance of the City. Since building started in the 1980s, a number of leading financial institutions have moved to the area. Canary Wharf Group continues to develop the site and has been given planning permission for a new, two-tower building known as Heron Quays West, which will stand 156m (512ft) tall when completed. However, little progress has been made, and a spokesman for the group confirmed yesterday that there were no immediate plans to start building on the site. The group also admitted there had as yet been no serious expressions of interest from potential tenants.

Helter Skelter

When completed in 2013, the Helter Skelter will be one of the tallest building in the City, at 288m (945ft). Architects had planned for it to top 307m (1,007ft) but concerns from the Civil Aviation Authority resulted in the height being chopped. Originally developed by Union Investment, the property was bought by Arab Investments during the early stages of construction. The new owners altered the design and building work began afresh in 2009.

Riverside South

One Docklands skyscraper that is more likely to be built soon is Riverside South. The land was sold to investment bank JP Morgan for £237m in 2008. Plans exist for the bank to use the 214m (702ft) tower as its European headquarters from 2013. The office will then become the tallest building in Docklands, beating One Canada Square by one metre (although One Canada Square will appear taller on the London skyline). The problem is JP Morgan's failure to commit. A source at the bank said last night that a decision on its new headquarters would be taken later this year, based on economics and London's position as a financial centre. He rejected the idea that the bank was annoyed by higher taxes on City firms.