Empire Square will not proceed

Sydney-based Metacap Developments this week advised investors it will not proceed with the Empire Square project in Brisbane because of the worsening turmoil in the financial markets.

"While we were fortunate enough to obtain an indicative offer of finance, the terms and conditions offered imposed constraints on the project that could not be accommodated and under the proposed construction and operating arrangements.

Metacap Developments director Jerome Chopard said the uncertainties and constraints in financial markets had impacted on the ability and willingness of banks to lend funds, especially for major construction projects such as Empire Square.

"It is with regret, Metacap has been forced to a position where it must elect not to proceed with the Empire Square project," he said. Metacap had considered deferring the project to a later date, but decided this to be a less desirable outcome as it simply defers the uncertainty and doesn't give buyers the opportunity to make alternative choices.

Jerome Chopard stated that Metacap was considering its options which included the re-design of the tower.

Colliers International's Ben Langfield said: "It's extremely disappointing however considering the state of the financial market and the likely hood of the project not proceeding terminating purchaser contracts and releasing the 10% deposits is the right thing to do."

"All purchasers are realists. They are disappointed however they understand what's happening in the financial market and respect the fact that the developer has been open, honest and has made this decision with their best interests in mind," said Mr Langfield.