Canary Wharf Group, owner of Britain's tallest building, said today vacant space at its office complex in east London was rising as political and economic woes deter tenants, sending its share tumbling.
The shares, which had already halved in less than a year on signs of a slump in London's office property market, dropped as much as 18 per cent to 188-1/4 pence in early trade, their lowest level since their flotation in 1999.
Canary Wharf, which has turned derelict docklands into a Manhattan-style financial district on the banks of the Thames, said vacancy rates rose to 6.7 per cent in the six months to December 31st, from 4.5 per cent at June 30th.
Chief executive Mr George Iacobescu said this could rise toward 10 per cent by the end of this year under the worst-case scenario that the company did not agree any new lettings.
Canary Wharf has attracted high profile tenants such as bankers Citigroup Inc and HSBC, accountants KPMG and oil giant Texaco to its docklands development, which is dominated by an 800-foot tower at One Canada Square.
The firm's shares have suffered in recent months from concerns its exposure to financial services firms, which are suffering from depressed stock market conditions and the global economic downturn, might put pressure on its rental income.