Plans to build more than 1,000 homes on an IKEA car park and former B&Q store have been withdrawn because of the “spiralling” costs of construction.

The developer behind the scheme, London Square, today confirmed it had withdrawn its planning application for Bugsby’s Way in Greenwich Peninsula, South London.

“We have decided to review our current planning application for Bugsby’s Way, Greenwich,” a spokesperson for London Square said in a statement. 

“We are assessing the viability of the development, in the light of spiralling costs in construction and building materials. We may then look at submitting a revised application in the future.”