The actor, alongside BD Hotels and property firm Capco, was granted planning permission for the luxury 83-room Wellington Hotel in August 2016.
Several restaurants in the area, including the iconic Joe Allen, were forced to close or relocate when BD Hotels and De Niro acquired the site.
BD Hotels founder Ira Drukier confirmed to the Evening Standard that a “changing economic picture” has made the project “marginal” but if the economic situation were to change the group would be “very happy to move forward”.
Covent Garden landlord Capco confirm that the plans have been shelved, and that the company is considering proposals for “office and retail space” on the site having not reached “satisfactory commercial terms” with the hoteliers.
The Wellington was set to take up a full block of the Strand-facing side of Covent Garden, and would have been the second joint hotel project for De Niro and BD Hotels, who also run the Greenwich in Manhattan.
The luxury hotel would have been the first landmark hotel to be opened by Capco in Covent Garden since it acquired the estate ten years ago.