A group led by the National Asset Management Agency and Lloyds Banking Group Plc will ask an English court on December 12 to have administrators appointed for various units of Battersea Power Station Shareholder Vehicle Ltd. The lenders are owed £502 million (€586m).
London Mayor Boris Johnson and Mr Osborne donned hardhats and visited Berkeley Group Plc’s St James’s Riverlight project next to the power station site on November 28 to highlight regeneration in the Nine Elms neighbourhood south of the River Thames.
In his budget statement the next day, the British chancellor backed a proposed extension of the Underground’s Northern Line to Battersea and announced a plan to create an enterprise zone in the area to ease planning restrictions for businesses.
Developer Real Estate Opportunities had planned to build 3,400 homes and 330,000 square meters (3.5 million square feet) of commercial space at the power station, a protected historical landmark that was closed 28 years ago.
Engineering consultant Parsons Brinckerhoff estimated the cost of the transport link three years ago at £380m to £633m.
Another of the creditors seeking the appointment of administrators is Oriental Property Ltd, controlled by Victor Hwang, a Hong Kong entrepreneur who previously owned the power station.
He gave loans of £150m to help Irish property entrepreneurs Richard Barrett and John Ronan acquire the project five years ago. Barrett and Ronan, who control Real Estate Opportunities through their company Treasury Holdings, have relied on the support of Lloyds and NAMA to proceed with a £5.5 billion-redevelopment of the site.
REO sought a partner to back the project after obtaining planning consent in November last year.
Ownership of the 38-acre site transferred to Battersea Power Station Shareholder Vehicle following a debt- for-equity swap involving some of the creditors.
Real Estate Opportunities “remains in discussions” to sell its controlling stake in the site, it said yesterday.