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Battersea Power Station plans in doubt again (From Wandsworth Guardian)
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Battersea Power Station plans in doubt again
7:00am Thursday 3rd September 2009
The future of Battersea Power Station was thrown into doubt last week after financial figures revealed its owners assets are outweighed by its debts.
Financial results revealed Real Estate Opportunities (REO) had seen a sharp fall in the value of its Irish and UK property portfolio, but Councillor Edward Lister, leader of Wandsworth, said he wasn’t “overly concerned”.
Treasury Holdings has submitted plans to redevelop the iconic site with 3,700 new homes with office, retail and leisure space but interim financial results showed REO’s assets of £1.78bn were outweighed by liabilities of £1.87bn.
REO’s accountants KPMG noted REO’s financial statements do not include the adjustments that would result if the group was not able to continue as a "going concern".
Peter Byers, REO finance director, said REO was in a “very good position” and has a “good relationship” with its banks.
Coun Lister said the future Nine Elms was full steam ahead.
He said: “We are not overly concerned as all property companies are struggling at the minute.
"We have to keep the planning going so when the property market starts to lift we can get plans flowing quickly.”
But Brian Barnes, chairman of the Battersea Power Station Community Group, said: “They are talking about a £4bn project but they’re in debt.
"It seems like a lot of money to find. What is the point of a new Tube station if there is no development?”
REO has £556m of bank loans due this year and £201m due in 2010.
Meanwhile, the US Government is in a battle with the Treasury over a £50m tax bill on the construction of its proposed new embassy in Battersea.
The Treasury wants the US to pay VAT on its £275m building in Nine Elms, which it hopes to open in 2016.
Coun Lister said Chancellor Alistair Darling should grant an exemption.
He said: “Yes, rules should be followed but we are saying where there is a regional development that will create 1,400 jobs then the Government should be doing all it can to make projects easier.”
A US Embassy spokesman confirmed it was in talks with the Treasury over the issue.
Battersea Power Station plans in doubt again
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