Qatari royals' hopes for London palace crumble

The Qatari royal family's application to create a £200 million ($302 million) palace in the heart of London has been rejected by Westminster City Council's planning office.

Sheikha Mozah bint Nasser al Missned, one of the Qatari ruler's three wives, purchased the houses separately for an estimated £120 million in 2013.

A view of 1 Cornwall Terrace
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Now, the billionaire royals from the Gulf state wanted to knock together two mansions in the ultra-expensive Regent's Park area in Westminster in London. They hoped to create a lavish palace with 17 bedrooms, 14 lounges, four dining rooms, a swimming pool, cigar lounge and juice bar.

In one bureaucratic swoop, however, the application was turned down by Westminster City Council officer Matthew Rees, who said the development would be out-of-sync with the council's plans for addressing the shortage of homes in the area.

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Sheikha Mozah, the wife of Qatar's Emir, Sheikh Hamad bin Khalifa al-Thani.
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In a planning document available online, Rees recommended that Westminster refuse permission for making the two houses —numbers 1 and 2 Cornwall Terrace—into a single dwelling. He said combining the houses would amount to the "loss of a family-sized unit of residential accommodation" and was contrary to the council's strategy to optimise housing provision in the area.

"It is not considered that there are such exceptional circumstances to allow a policy departure, and it is recommended that permission be refused," Rees stated.

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It seems that petro-dollars don't always talk. The Qatari royal family had offered £850,000 towards the council's affordable housing fund, but Westminster did not permit the payment, saying it would not mitigate for the loss of a family-sized house.

The Shard, also owned by the Qatari royal family
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Westminster is one of central London's prime real estate locations, along with other sought-after areas like Chelsea, Kensington and Mayfair. The Qatari royal family is also well-known for owning an iconic part of the London landscape, the 87-storey Shard, which houses offices, restaurants and hotel rooms. It also owns the luxury Harrods department store in Knightsbridge, and this week, the Qatari sovereign wealth fund won a battle to purchase the Canary Wharf financial district for £2.6 billion.

Across much of London, a shortage of new homes has contributed to prices rising substantially – up 17.8 percent year-on-year in 2014, according to Nationwide's house price index.