A group of four South East Asian banks offered to fund the scheme with a funding package totalling £790.2m to cover the costs of the re-development of the iconic power station as well as the refinancing of the surrounding land.
The two-tranche funding by CIMB Group, Oversea-Chinese Banking Corporation (OCBC) Bank, Standard Chartered and Maybank comprises:
- a £532m five-year development facility for the first phase of the development and the refurbishment of the power station itself over the next three and a half years;
- a £258.2m land facility, which refinances the initial loan used to fund the purchase of the site over a period of five-years.
The consortium of banks has already an established relationship with the new owners of Battersea Power Station – SP Setia, Sime Darby and Employees’ Provident Fund, who are providing up to £1bn of equity finance to the entire development scheme.
The financial agreements indicate the strong pre-sales of properties in Phase 1 with a 99 per cent take up of the residential houses at a striking rate of sales and the nomination of contractors for Phases 1 and 2, thus leaving no ground for doubts on the cost and span of the development scheme.
Simon Murphy, Chief Financial Officer of Battersea Power Station Development Company, remarked:
“The financing agreements are a key step in the development of Phase 1 and the restoration of Battersea Power Station and in bringing the iconic building into public use after 30 years.
“The agreements are a demonstration of both the level of confidence in this project, in London and internationally, and the strength of the relationships between the shareholders of Battersea Power Station and the banks.”
Carillion started on Phase 1 of the development, Circus West, in July 2013, which will provide a mix of 866 apartments, townhouses and penthouses in addition to offices, retail, leisure and hospitality facilities designed by Ian Simpson Architects and de Ryke Marsh Morgan (dRMM).
The renovation of the power station itself, which is part of the funding package, will involve the reconstruction of the chimneys to the original designs, scheduled to begin next year. According to the current plans, the power station will incorporate a blend of shops, restaurants, cafes and bars, plus a state of the art events space, offices, a hotel and new homes.