Big plans for the City skyline

GIVE or take the odd spire, the City is a pretty low-rise affair. A powerful heritage lobby and cumbersome planning regime has kept the skyline close to the ground. The tallest building, Tower 42, is a mere 600 feet high - half the height of New York's Empire State Building - and is already 25 years old.

Much of the office space under construction in the Square Mile is decidedly squat. A few strategically placed cardboard boxes and you could probably jump off the top of St Paul's Cathedral's new neighbours in Paternoster Square and survive.

But that could all change. Last month, after a £10m public inquiry, the Government decided to let Gerald Ronson build his Heron Tower at 110 Bishopsgate. At 730 feet, the Heron Tower will be the tallest building in the City. Some believe it suggests the Government will look kindly on more than a dozen other skyscrapers that developers would like to build.

Turn left out of Liverpool Street in a few years and, as an Estates Gazette picture shows, you could find yourself in Little Manhattan. Lord Foster's 590ft erotic gherkin for Swiss Re is well on its way to completion and word is that Minerva's 650ft wedge of a building in Houndsditch will get the go-ahead without the expense of a public inquiry.

But it is not just the City's skyline that will be transformed. More speculative office space is under construction than at any time since the late 1980s. The few tenants looking for space are outweighed by the number of existing occupiers desperate to sublet unused offices. Rents have dropped 10% in the past year. The Heron and Minerva towers will go ahead without the comfort of a pre-let agreement.

Building offices in the Square Mile costs about £175 per square foot. The 380,000-square-foot Heron Tower will cost about £70m to construct. Martin Wallace, of property agent Jones Lang LaSalle, said: 'Even at a greatly reduced rental of say £50 a square foot, that would still give an annual income of £19m - enough to tempt a buyer. It would be worth well in excess of £300m.'

Although last September's terrorist attacks on the World Trade Centre in New York revealed the vulnerability of skyscrapers, developers believe new towers will still be popular with City tenants. Bradley Baker at Knight Frank's City office said: 'Tall buildings attract the highest rents because tenants want to be in them.'

The Corporation of London's chief planner Peter Wynne Rees said the Heron decision, which he supports, should not open the floodgates. 'As a planner, I have to be very careful that this enthusiasm is not interpreted as carte blanche for developers.'

But he said the City will 'allow in principle a cluster of tall buildings in the eastern quarter of the City that are clear of the protected views of St Paul's'.