The site of the former Sofitel Hotel in Clifton, Karachi, will be converted into an office block with residences, restaurants and a luxury club.
Accor announced the project in 2006 with plans for it to be finished last year. If it had been completed, the 27-storey tower would have been the largest building in Karachi.
However, the Accor group which operates the Sofitel brand has gradually been pulling out of Pakistan this year, due to "a lack of law and order".
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Abdul Rehman Naqi, managing partner of the project told the Express Tribune newspaper: "There is really nothing we could do about it. Accor has pulled out of four projects in the country. But we have other plans now. We are looking at using all the floors in a different way."