Published on 11 Jan 2013 Sections ,

Does London actually need the Shard?

As the Shard’s viewing platform prepares to open to the public, Sarah Smith looks at Qatar’s growing presence in London’s property market and asks: why is the Shard there?

The view from the top of the Shard is breathtaking. As you’d expect from the highest point vantage point from any building western Europe. It’s probably the only place from where you can see the whole of London, and beyond. St Paul’s looks relatively tiny from up there. You actually look down on One Canada Square in Canary Wharf.

But what’s the point of this huge building? London didn’t need more office space – there are not yet any confirmed tenants for any of the commercial office space and the expensive private apartments aren’t even on the market yet. A five-star hotel will open soon, as will a couple of restaurants. But we weren’t short of those. So why is it here?

It has been erected as a very visible demonstration of the rise and growing global importance of the tiny Gulf state of Qatar – the people who own the Shard. They clearly like owning landmark addresses in London.

And from the Shard you can see their prestigious property portfolio laid out below you. Much of Canary Wharf is theirs. They bought up the Olympic village as soon as the games were over. Harrods belongs to Qatar, and they built One Hyde Park – the world’s most expensive block of flats. They also own 20 per cent of the London Stock Exchange, 20 per cent of Camden Market, Chelsea Barracks and the site of the US embassy in London. The Qatari Investment Authority obviously likes trophy investments. But why?

Qatar is using its huge wealth (from massive natural gas reserves) to announce its presence in the world. That’s why they created and fund Al-Jazeera TV and why they are delighted to be hosting the World Cup in 2022. They might be small but they are rich, and they are buying friends and influence around the world, using their investments to cement good relations with western allies like the UK, US and France.

The Qatari sovereign wealth fund also own 26 per cent of Sainsburys. It was Qatari cash that propped up Barclays Bank at the height of the credit crunch (a deal that’s now being investigated by the Serious Fraud Office) and they control about 20 per cent of the gas supplies imported into Britain. Greenpeace has calculated that in 2011 every British household paid the Qataris £89 for gas. And those imports will keep rising – it won’t be long before we get 50 per cent of our gas from Qatar.

The all-powerful, Sandhurst-educated emir, Sheikh Hamad bin Jassam bin Kalifa al-Thani is welcomed to Windsor Castle by the Queen and feted in Downing Street by David Cameron. He is treated as a good friend, valuable investor and trusted middle eastern ally. No wonder – he owns far more of the UK than you may have realised. And we can’t now afford to fall out with Qatar.