Chelsea Barracks chief resigns with £3bn project still on hold

The developer in charge of the stalled £3 billion plan to build hundreds of luxury flats at the former Chelsea Barracks site has quit.

John Wallace, chief executive of Middle East property company Qatari Diar resigned two months after the company was ordered to “start or sell” the much delayed scheme.

Mr Wallace is set to leave “at a date to be agreed” after five years with the company.

The 13 acre site, bought in 2007 by Qatari Diar with developer Christian Candy for a record £959 million from the Ministry of Defence, remains Britain’s most vaulable wasteland.

The company has come under pressure from Westminster council to make a start on the work, triggering payments totalling £78 million that will be ploughed into affordable housing.

But property market sources say the Qataris paid too much for the enclave between Sloane Square and the Thames at the top of the market bubble and is now having to rethink the scheme.

Mr Wallace, who has a background in banking, played in crucial role in winning planning consent for Chelsea Barracks, which has rarely been out of the public eye over the past six years.

The original Lord Rogers designed scheme was withdrawn following the intervention of Prince Charles, who criticised the plans in a letter to the Qatari Prime Minister.

That in turn led to a high profile court case brought by Mr Candy in 2010 in which the Prince’s intervention was described by the judge as “unexpected and unwelcome”.

The row is thought to have contributed to the mounting costs and delays holding back the scheme.

In a statement Qatari Diar, which is ultimately owned by the emirate’s ruling family, said it “values Wallace’s significant achievements and commitment over the past five years and will be sorry to see him leave”. No replacement has been announced.

Mr Wallace said: “I have enjoyed my time with Qatari Diar enormously and have been fortunate to have been involved with some fantastic schemes and working with some great talent. I look forward to taking on new opportunities and challenges.”

Qatari Diar said: “Contrary to recent press reports, we are fully committed to the Chelsea Barracks development, are are currently negotiating rights to light with its neighbours.”