The Russia Tower, an iconic project at the heart of the prestigious Moscow City complex, will never be built, it has been confirmed.

Instead the 2.4 hectare site will be turned into a car park for 3,000 vehicles to serve existing buildings in the complex.

Developers Russian Land announced at the end of last year that the tower, which had been due for completion in 2011, was being put on hold.

Now it has revealed that it cannot find the $2 billion needed for the project. It had been in discussions with a number of companies with regard to financing. Mirax, one of Russia's top five property developers, had been interested in buying the project.

Sibir Energy had also been in talks but the plan was not possible due to a conflict of interest clause as Russia Land's owner, Shalva Chigirinsky, holds a large amount of shares in the oil company.

At one point the developers even considered building a shortened tower, shaving some 400 metres off the height. But none of the deals discussed were sufficient and its demise is considered as a serious blow to the city.

'Without the Russia Tower the Moscow City project is nothing,' said Mirax owner Sergei Polonsky. He has offered to re-name the Federation Tower which is nearing completion nearby so that the development has an iconic tower.

The 620 metre tower, designed by London based Sir Norman Foster's firm of architects was to have been the tallest in Europe and the second tallest in the world with substantial residential, retail, office and hotel space.

Functioning as a dense 'vertical city' the tower was to have housed 25,000 people, with offices, a hotel, shopping and apartments with private gardens. It included an ambitious self-ventilating system and was described as representing the economic and social vitality of Russia's capital city.

But the vitality has gone out of the Russian economy because of the global crisis and the tower has no life left either.