September 2, 2016 / 12:45 PM / 3 years ago

Berkeley Group halts half-built 20 million-pound London housing scheme

LONDON (Reuters) - UK housebuilder Berkeley Group Holdings Plc has halted construction at a 20 million-pound luxury housing project in London, it said on Friday.

Berkeley Group declined to say why it stopped construction last month at the Barnes Village scheme in southwest London, where homes were expected to sell for up to 5 million pounds, local residents said.

But other housebuilders, estate agents and analysts have said they expect the vote to leave the European Union to hit the UK real estate market, especially in London which is fuelled in part by European purchasers.

It’s not unusual for builders to hold off starting developments until market conditions are optimal. However, it is rare for projects to be stopped mid-build, said Clyde Lewis, analyst at brokerage Peel Hunt, who covers Berkeley.

Basements and ground floors had already been built at the Barnes site.

“The London market has got a bit tougher post-Brexit,” he said, referring to the June referendum on EU membership.

“The value end of London is still selling OK but more expensive stuff is selling slow,” he said.

Berkeley Group’s cash pile dropped by more than 300 million pounds last year but the company was still ungeared at the end of its financial year in April.

Reporting by Tom Bergin; Editing by Greg Mahlich

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