Real Estate Opportunities is “considering its options” after negotiating the deferral of a £263m debt repayment until next year.
It is understood the company, which owns Battersea Power Station, might have to undertake an equity raising to meet the new deadline in August 2011.
The company bought the site for £400m with £263m of debt from Bank of Scotland and Bank of Ireland but breached its covenants in the downturn.
Lloyds, owner of BoS, and Nama, the Irish bad bank now controlling the BoI loan, agreed to waive the breach and extend the loans until 31 August next year.
The agreement had been conditional on REO, which is majority owned by Irish developer Treasury Holdings, securing a deal with Oriental Property, the former owner of the power station, to defer “principal and interest payments” on the £150m of loan notes it holds.
On Monday, REO confirmed an agreement had been reached with Oriental Property that formed the “basis of a wider compromise agreement”.
The deferral ensures that plans by REO to spin-off the power station and float it ahead of a proposed £4.5bn redevelopment remain on track.
bridget.oconnell@estatesgazette.com
