THE showpiece "two towers" project for Chatham Maritime has been sunk by rising costs.

The Chatham Quays scheme – two blocks of luxury flats rising to 19 and 16 storeys in glass and aluminium-fronted towers – was a key development in the regeneration of the former dockyard’s commercial sector.

Bars, restaurants and a health club were also planned around the adjacent marina.

The 240ft high 19-storey block would have been the tallest building in the Kent Thames Gateway. But ING Real Estate Development UK, the company behind the scheme, said escalating construction costs meant the scheme was no longer financially viable.

The company has already spent several million pounds on "enabling" work.

In July last year Chatham Quays opened a marketing centre on the site of the proposed scheme, where a model of the tower blocks went on show. It’s understood that a number of investors have already paid deposits for flats, which started at £95,000.

South East England Development Agency, (SEEDA), which selected ING as its preferred developer, said it regretted the company’s decision.

Project director Jonathan Sadler said: "It’s very disappointing. SEEDA still owns this site, and we will now consider our options for a future development."

Medway council’s strategic planning supremo, Cllr Jane Chitty, said: "ING’s decision is both surprising and sad news. I now await with very great interest, any new proposals the two organisations have to offer for the development of this important site."

ING Real Estate have not shut down their ambitions for the site entirely. A spokesman said the scheme had been "shelved" not abandoned. "ING will be discussing with SEEDA how the project can best be taken forward," he said.