The Malaysian buyers of Battersea Power Station will spend £200m over the next two years developing the first phase of the £8bn project.
SP Setia, Sime Darby and KWASA Global, a Jersey-based subsidiary of Malaysia’s Employees Provident Fund, exchanged contracts with administrators this week to buy the south London icon for £400m.
The parties, advised by Jones Lang LaSalle, will begin work on a £200m residential first phase of the 39-acre site on completion of the deal, expected in Q3.
SP Setia said a February 2012 Savills UK residential report showed Asian buyers, at 26%, were the most active foreign investors in new-build homes.
It added: “This validates the group’s belief that a significant number of its customers from Malaysia, Singapore and other Asian cities are actively looking to invest in UK property.”
The consortium is expected to tinker with future phases of the 15-year masterplan to increase the ratio of housing from the consented 3,700 homes, 1.6m sq ft of offices and 500,000 sq ft of shops and restaurants. It expects to redevelop the London icon in seven phases.
Future funding will be made pro rata based on the consortium’s stakes in the scheme – 40% each for Setia and Sime Darby and 20% for EPF.
External borrowings will be used “where practicable” and provided they do not make the jv’s gearing “exceed prudent levels”.
Knight Frank and Ernst & Young advised on the sale.
Nick.Whitten@estatesgazette.com
