London Battersea project site gets high marks

PETALING JAYA: The Battersea Power Station project in London, which will be developed under a joint venture involving Sime Darby Bhd, SP Setia Bhd and the Employees Provident Fund (EPF), has good prospects due to the site's location, good take-up rates from neighbouring property launches and lower costs.

CIMB Investment Research said it was more positive on the project following a recent visit to the site.

“We like the location of the site and the fact that the property benefits from 400 metres of river frontage and forms part of the Nine Elms regeneration area,” it said.

CIMB also said the wealthy residential neighbourhood would benefit the project.

“The property is adjacent to Chelsea Bridge and is assessable by two railway stations, which are within a five minutes' walk. On top of that, there are plans to build an underground station (Battersea station) on the property as part of the Northern Line extension.

“We drove around the Nine Elms area and saw three property launches near the site, namely the Embassy Garden, Riverlight and St George Wharf. We found that these launches have been selling relatively well,” it added.

CIMB said the prices for new launches ranged from as low as £1,000 (RM5,000) per sq ft for the Riverlight project (which is very close to the Battersea site) to £1,200 (RM6,000) per sq ft for Embassy Gardens, which is near the proposed new US embassy and opposite the Riverlight project.

The research house said its entourage that visited the site that comprised personnel from Sime Darby and SP Setia. The project represents the companies' maiden venture into property development in London.

“Sime Darby and SP Setia announced last Thursday that they would each take a 40% stake in the joint-venture (JV) company, Battersea Project Holding Co Ltd, which would acquire the Battersea Power Station land. The EPF will subscribe to 20% stake in the JV company via its subsidiary, Kwasa Global (Jersey) Ltd,” it said.

Battersea Project Holding Co, through subsidiary Battersea Project Land Co Ltd, had on July 4 entered into an agreement to acquire the property for £400mil (RM2bil) or £235 (RM1,176) per sq ft. The estimated development cost over a two-year period is £200mil (RM1bil).

According to CIMB, the Battersea station site takes up 14.5 acres in the freehold land measuring 39.1 acres. The property is situated in front of the River Thames between Chelsea Bridge to the west and Vauxhall Bridge to the east.

“The property is part of the strategic Vauxhall Nine Elms Battersea Opportunity Area Planning Framework, the largest urban redevelopment network area in central London,” it added.

By The Star