Dublin Docklands Authority has suspended the project for a year because of the current uncertainty in the property and financial markets.

The $250m U2 Tower planned for the Dublin docklands and designed by the British architect Norman Foster, was to house an egg-shaped recording studio at its peak for rock band U2 as well as luxury apartments and a hotel.

Work on the 120m tower on the south bank of Dublin's River Liffey was originally intended to begin this year, with a completion date in 2011.

Dublin Docklands Authority said that following discussions with development consortium Geranger, led by developer Ballymore, Irish investor Patrick McKillen and U2 band members, 'we have now decided to suspend negotiations regarding the development for up to twelve months to allow for an improvement in the current uncertainty surrounding the property and financial markets'.

The Geranger consortium had been selected as the provisional preferred bidder to design, construct and finance the U2 Tower late last year.

The Dublin Docklands Development Authority said it 'continues to have full confidence in this landmark project for an inspirational U2 Tower building, which is an important element in the master plan for the area'.