Battersea Power Station Sale Breaks UK Record
Battersea Power Station Sale Breaks UK Record
Two Malaysian state funds have agreed to purchase Battersea Power Station in south London in the UK’s largest ever property deal that will see the landmark sold for £1.6bn.
Permodalan Nasional Berhad sovereign wealth fund and the Employees Provident Fund of Malaysia will together purchase the Grade-II listed power station, not including the surrounding 42-acre site, The Battersea Power Station Development Company (BPSDC) has confirmed.
The two Malaysian groups intend to build a combined total of 4,300 residential and office units in the vast and historic site.
A BPSDC spokesperson said that the group would retain an active role in the building’s management, as the redevelopment project to turn the estate into a mixed-use space for retail, leisure, commercial and residential units continues.
“With the conclusion of the proposed transaction, BPSDC will remain the principal manager of the development. This creates a solid platform that will ensure the protection, active management and control of the historically important building are maintained,” the spokesperson said.
It has been reported that the new deal will not threaten the redevelopment project’s quota for affordable housing, which has already been cut dramatically from 636 flats to 386 flats, constituting just 9% of all homes to be built in the power station.
The power station was operational for fifty years from 1933 until 1983 – although its generator was only completed twenty years in, following building delays as a result of the second world war – and was eventually responsible for a fifth of London’s electricity supply at its peak.
Redevelopment projects began in 2012, but have suffered setbacks with health and safety issues following the discovery in 2014 of extensive asbestos. It is now hoped that the building will be completed by 2020.
Apple boost to power station fortunes
Sources have stated that the iconic power station became a much more attractive prospect to investors after Silicon Valley tech company Apple announced its decision to base its UK headquarters in the former coal-fired power station’s central boiler house from 2021, guaranteeing a secure future channel of income and accounting for a quarter of the total building.
News of the sale to the Malaysian investors comes as a new group of restaurants and cafes set to open sites in the Battersea Power Station development were announced this week.
BPSDC chief executive Robert Tincknell noted that the site was “fast emerging as London’s newest and most exciting food and drink destination.” The latest additions to the project’s hospitality outfits include French, Japanese and Australian cuisines and a craft microbrewery.
Previously, the £1.3bn sale of 20 Fenchurch Street – also known as the ‘Walkie Talkie’ building – to Chinese investors was the most expensive property sale that the UK had seen.
£1m price tag for Battersea’s ‘Slim House’
Meanwhile, in contrast to the vast bulk of Battersea Power Station, the so-called ‘Slim House’ in Battersea, which at 7ft 7in wide is narrower than a Tube carriage, has gone on the market for £1m. The three-storey home – built in a gap once used as an access route to stables in Battersea’s St John’s Hill – is being marketed by Savills.
London’s commercial property bonanza expected to extend to 2018
Total annual commercial property investment volumes in the City reached £12.6bn in 2017, beating the 10 year average by 57% and with the rise in turnover driven by an increased demand for “trophy assets”, according to Savills.
More than 28 nationalities of investors acquired real estate in London, with more than half of total turnover accounted for by Asian buyers, compared to 14% of European and 12% UK buyers.
Savills said that demand for the “safe haven” of London property was likely to continue this year.
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