Developer Alburn has been pursuing proposals for a site at Tradeston on the south bank of the Clyde since being chosen by Glasgow City Council as its preferred development partner for the site in November 2003.
Planning permission for the project, which would have seen the construction of 943 apartments, was granted in 2005.
Work on the first stage of the 10 year development - a 313 apartment block with 3,500 sq m of commercial space - had been pencilled in to begin work in the spring but speaking to Construction News this week Auburn property director Nigel Kinnaird said the scheme was now on hold.
He said: “We have completed demolition work but we will not be going to a tender any time soon.
“We have become victims of the market. We will look at the project again next spring.”
Alburn is understood to have approached a number of main contractors to price the project prior to the decision to put the scheme on hold, although Mr Kinnaird said there had been little interest in taking on the scheme.
But he said he was still confident the scheme would be delivered as soon as the property market strengthened.
Elsewhere, rival residential developer Dandara has rebuffed claims that it has had to put a hold on starting new projects due to a lack of activity on some of its key sites.
The firm has planning approval for two of the UK’s tallest residential tower schemes - the 50-storey V Building in Birmingham and the 40-storey Chapel Wharf scheme in Salford.
The Birmingham project was given planning approval in January while permission for Chapel Wharf has been in place since 2006 and work had been expected to start on both this year.
Industry sources claimed this week that the developer had put starts on new developments on hold until it cleared sales on its existing schemes, but this was denied by the Isle of Man-based firm.
A Dandara spokeswoman said that, while a start on the V Building had been delayed, this was due to design changes rather than poor trading conditions.
And Peter Lackey, managing director for Dandara North, said: “Dandara remains fully committed to developing its sites across Manchester and Salford and is progressing with its development strategy as planned.
“We are concentrating our efforts on completing our flagship scheme, Spectrum.”
Analysis: Developers’ jitters slow down schemes
By John Brown
The brakes are on generally. I don’t think there will be a residential-led scheme out there where the developer isn’t considering slowing down or stopping.
Everyone is very nervous because we are sitting on a timebomb and we don’t know when or if it is going to explode.
The industry is being challenged and developers can’t even be sure where the next threat will come from.
There are not enough buyers and it could lead to the construction industry going into recession. Mortgage availability is the fundamental problem.
Mortgages are expensive and limited, while there is also a higher interest threat.
The question is whether to panic now or later.
Firms, be they developers, construction companies, architects or engineers, need to make sure that they have a good look around at what is going on.
Markets will return, although in the local areas at different times.
But it’s now a bitter experience and will be for another year.
John Brown is director of land and property sales at consultant DTZ Scotland