The art-deco icon, which won global recognition through appearances in movies such as Stanley Kubrick's "Full Metal Jacket" and on the cover of Pink Floyd's 1977 album "Animals", has been derelict for over a quarter of a century.
It has already passed through numerous developers' hands since stopping power production in 1983 as Britain shifted to oil, gas and nuclear.
Developers now are courting investors for a 5.5 billion pound ($8.9 billion) redevelopment just as banks remain focused on unscrambling exposure to commercial real estate. The market has shown signs of recovery recently but is still treacherous.
"The building is likely to suffer major structural damage in five years if full repairs don't start before then," said Jeremy Castle, chief planning director at Treasury Holdings UK, the power station's current developers, referring to damage sustained after the roof was removed 20 years ago.
"We need to move fast to redevelop the site because the building is deteriorating quickly," he said.
The two-year downturn in Britain sliced almost 45 percent off average commercial property values. The Power Station's owners, who bought it for 400 million pounds in 2006, say its value fell by 15 percent in the six months to end-June 2009, causing the company to breach terms on some of its loans.
Battersea's imposing white brick chimneys have been a popular feature of London's skyline for almost 80 years, but its brickwork is held together by metal straps. Many bankers and financiers say plans to redevelop it are a commercial anachronism in a city obsessed with skyscrapers.
Castle's employer Treasury Holdings is an Irish property firm that controls the Battersea site through a 67 percent share in debt-laden Real Estate Opportunities (REO.I) (REO.L).
REO says the debt taken out to buy the station is still performing, but part of it, along with the majority of its loan book, will be transferred to Ireland's bad bank, or the National Asset Management Agency (NAMA) next year.
The Irish government is paying 54 billion euros ($78 billion) to buy risky commercial property loans with a combined book value of 77 billion from banks to clean up the legacy of excessive lending.
Reuters
1 comment:
Passed it every week for a year on my way to/from Croydon, little did I know that I'd own part of it today thanks to the Irish Government bailing out their developer buddies!
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