A destination south of the Thames

  • Business
  • Saturday, 27 Jul 2019

Media update: Mason with models of the Battersea Power Station Phase 3A during a media interview at Setia International Centre, Kuala Lumpur.

THE air was still. Nothing moved. Only the sun shone.

Located south of the Thames, at the heart of the once-derelict Battersea Power Station stands a bright orange brick building.

A Taiwanese art student stood on Chelsea Bridge a few hundred metres away.

Deftly, her thick black strokes immortalised the power station on her A4-sized ringed sketch pad.

It is the four white chimneys rising up into the sky, like two pairs of arms beseeching the heavens for a new lease of life, that ever so-often stop one’s tracks.

There is a certain surreal atmosphere about those two pairs of chimneys against the bright blue sky on that sunny 2012 afternoon.

The story today is different. No longer abandoned or forgotten, cranes now dot the Battersea skyline. The redevelopment of the 42 acres started a year later.

Over the past six years, the Malaysian press corps have charted its progress with pride and enthusiasm.

In June, for the first time, the Malaysian media was introduced to the completed phase one, known as Circus West Village, now home to about 1,000. A seafood fest and other cultural events have been organised to celebrate its rebirth.

While phase one offers much – 24 retail shops, 865 apartment units with 11,000 sq ft of facilities including gym, spa and swimming pool and 25,000 sq ft of office space – the highlight is really phase 2, the actual power station itself.

The magnet that is expected to attract traffic in the years to come, as it once used to hold the life and soul of the 42 acres decades ago, phase two is scheduled to be ready in 2020/21, developer Battersea Power Station Development Co Ltd communications director Kate Boothman Meier says during her recent trip to Malaysia.

The Employees Provident Fund (EPF) and Permodalan Nasional Bhd (PNB) have 35% and 65% stakes in the power station, which occupies 5.9 acres out of the 42 acres.

The sellers are SP Setia Bhd and Sime Darby Property Bhd, who each owns 40% and EPF, 20%. This means EPF is extending its stake there with this purchase that was concluded earlier this year.

When Power House is completed, it is expected to offer both investors a unique investment opportunity to own an iconic development in the heart of London, particularly in today’s low interest rate environment. Leasing negotiations have commenced, the media were told during the visit.

Tech giant Apple has pre-leased 500,000 sq ft of the 540,000 sq ft of office space located in the boiler room. They will occupy six out of the 12-storey building, or 93% of the office space.

Swedish boutique co-working space No. 18 will occupy the remaining 40,000 sq ft in the engine room. A 35,000 sq ft foot hall, slightly less than half a football field, is being planned out of the total 420,000 sq ft of net lettable retail mall space, equivalent to 130 retail and food and beverage (F&Bs) shops.

There will be an event space to accommodate 1,500 people. Even back in 2012, there were talks about the power station holding the London fashion week and such. Such was the power of vision then.

So the possibilities are there. A six-acre park fronts the Thames.

“It is shaping to be a destination,” says Battersea Power Station Development Co Ltd international sales director Philip Mason during a visit to the Far East comprising Hong Kong, Singapore and Malaysia. Thousands thronged the place during a seafood festival held in phase one, Mason says.

“People from Chelsea and other parts of London visit the site because it holds so much historical and cultural sentiment for them,” he says.

Mason says various projects have been – or being built – south of the Thames but none holds the Battersea charm.

“They are not buying just an apartment but they are buying into a community with retail, office and other commercial elements,” he says.

Rental yields in the development’s first phase are about 4% to 5%, compared with 2.5% to 3% for other prime central London properties, Mason says.

As for the on-going Brexit process, that is “something we’re just kind of done with,” he told the Singapore media, adding that sales have not been much affected as investors take advantage of the weaker pound, which was at RM5.11 to £1 on July 21, 2019.

In the last 12 months, residential sales amounted to £120mil (RM634mil) despite Brexit, chief financial officer Benn Zemek told the media during the June visit.

“There is a mixture of buyers and potential buyers from South-East Asia including Malaysia and Singapore backed by strong local demand,” he says.

The scheduled completion of the Northern Line Extension (NLE) in 2021 is expected to spur growth in the area. By the end of this year, land, which is currently being used to construct NLE, will revert to the developer.

This will then see the construction of the second portion of phase three, the media were told.

Already, Battersea memorabilia are being created and sold. Phone covers, notebooks and shopping bags with the iconic chimneys are expected to fill retail shelves.

Some of these new designs come with the strapline ‘Powered by Positive’. Some of these are designed by architect WilkinsonEyre, the lead architect for the power station itself.

“Powered by Positive is an appropriate and inspiring way to encapsulate the feeling you get when you visit Battersea Power Station,” London-based design agency Greenspace creative director Lee Deverill said on his website.

Many in Britain and Malaysia share Deverill’s sentiment.

To build a block of simple apartments overlooking the Thames, you need vision, but not much.

To regenerate 42 acres which have been derelict and abandoned for more than 30 years, you need vision, courage and foresight. Many tried. Few succeeded. One did.

As the blue ripples of the Thames glide gently beneath Chelsea Bridge, buses, cyclists and cars speed along, each seeking a destination. In a little while, possibly there will only be one destination south of the Thames.

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