Crest Nicholson walks away from Chiswick development as it moves portfolio away from higher-value homes.
A residential deal in Chiswick, west London, has collapsed over concerns about the impact of a mansion tax on homes worth more than £2m.
Housebuilder Crest Nicholson is understood to have pulled out of a deal to buy 10 Windmill Road for an £18m luxury residential scheme, partly because of worries about the imposition of the tax after the next general election.
Labour leader Ed Miliband has committed to imposing a mansion tax on properties worth more than £2m, while the Liberal Democrats have backed such a tax implemented through new council tax bands.
Crest’s decision to walk away from the Chiswick scheme comes as the developer also repositions its portfolio away from high-value properties because of rising demand in the mid-market. The Windmill scheme, which was taken through the planning process with Hounslow Council by Crest, will create six townhouses all worth between £2m and £3m - the expected threshold of any mansion tax.
It is thought Crest had an option to purchase the site once it secured planning, but has now decided not to proceed. The site comprises an office building and an open car park, and is expected to secure full planning consent this month for six four-bedroom townhouses with private gardens and landscaping.
Allsop has been instructed to bring the site back to market for around £7m on behalf of MHA Associates, acting for a private individual.
Last month, Knight Frank warned that double the number of properties would be defined as mansions than when the proposals were mooted by the Lib Dems in 2009 due to house price growth.
Trevor Selwyn, managing of Crest Nicholson London, declined to comment on whether concerns regarding the mansion tax had affected the decision to pull out but said Crest had revised its land-buying strategy.
“Over the past year we have secured a number of sites all in excess of £1,000/ sq ft,” he said. “We are now looking for sites worth an average of £700/sq ft where we see the greater demand - hence our decision not to proceed with Windmill.”
Allsop declined to comment. MHA Associates confirmed the building was back on the market, but denied the mansion tax had an effect on the deal.