The poor house

REO stops paying interest due to creditors

TREASURY Holdings-backed property group Real Estate Opportunities (REO) owners of Battersea Power Station did not pay interest due to a group of its creditors at the end of the August.

REO is apparently in “ongoing restructuring negotiations” with the National Asset Management Agency (NAMA), Lloyds Bank and others about its loans. The company announced yesterday: “taking into account the status of the negotiations, the company has determined that the interest payment due … will not be made”, a statement that seems to imply that REO could pay the interest if it wanted to.

It owes its banks around €2 billion and in June said it would not be in a position to repay a €450 million debt due in May 2011. It hired advisers to help it tackle this issue.

Perhaps they could cut back on luxuries and use their tea bags twice.

The future of one of UKs best loved buildings is in the hands of mega debtors who claim they will use “their own money” to build the “essential” Battersea tube extension.

Read more in the Irish Times and Property Week.

Click Battersea Power Station for more blogs
See our Battersea Power Station project pages for more information and videos.
Or visit PlanA our general blog on urbanism, planning and architecture.

Battersea Power Station view from south

Two chances to hear about Nine Elms redevelopment, including Battersea Power Station and the US Embassy. Nine Elms is central London’s biggest regeneration opportunity. The area covers more than 450 acres of land along the south bank of The Thames – the vast majority of which is gearing up for major redevelopment.

Tues 27/7/2010 @ 7.30pm
ROSE Clubroom, Ascalon St SW8
Ascalon St is between
Thessaly Rd and Stewarts Road on Savona Estate access by car is from Wandsworth Road

link to a MAP and you can register your attendance for this meeting

Weds 28th July 2010 @ 7.30
All Saints Church, Prince of Wales Drive SW11.

Link to register attendance for this meeting and Map

Map All Saints Church is near Queenstown Roundabout

Wandsworth Economic Development Office have arranged these meetings chaired by Cllr Govindia and Cllr Lister.

You’d think that with debts up to their eyeballs, and Wandsworth Borough Council’s decision on planning permission still in the balance, the owners of Battersea Power Station would have enough to worry about.

But now new allegations have arisen in the Irish media about certain figures involved in REO, the property firm that owns the site.

The Irish Independent has reported that Willie McAteer, formerly finance director of Anglo Irish Bank, which loaned money to REO, also owns a stake in the company.

McAteer was also arrested and questioned by the Irish fraud squad in March 2010 following his resignation from the board of bailed out bank Anglo Irish in 2009.

Meanwhile accusations of irresponsible behaviour are in the air directed at Johnny Ronan, one of the owners of Treasury Holdings, REO’s largest stakeholder, with an opinion piece in the same newspaper accusing him of reckless spending. Mr Ronan’s children’s ‘lavish birthday parties…costing hundreds of thousands of euro’ come under fire.

This only adds to speculation on the propriety of his behaviour – in March the Irish Times reported that he was ’standing down’ from his position for a few months, following embarrassing revelations about his love life.

It seems Mr Ronan had been embroiled with arguments with a former girlfriend after being found taking extended lunches and private jet trips to Morocco with a former Miss World.

Not responsible behaviour, some might say, for a man whose company has debts funded by the Irish taxpayer to the tune of more than a billion euro.

Click Battersea Power Station for more blogs
See our Battersea Power Station project pages for more information and videos.
Or visit PlanA our general blog on urbanism, planning and architecture.

Spectacle homepage
Befriend Spectacle.Docs on Facebook
Follow SpectacleMedia on Twitter

Detail of a slide from REO's presentation to the Battersea Power Station Community Group

Even if you take the question in its strict financial sense, it’s not as simple as you might think.

Property consultants King Sturge valued the site at £388m in February of this year. But read the small print and you see that this value depends on some factors which are still in flux: the obtaining of planning permission, the extension of the Northern line to Battersea, and the availability of funding for REO’s huge debts.

To take the first issue of planning permission, that’s a decision that’s going to be made by Wandsworth Borough Council later this summer.

And it might not be as cut and dried at the developers hope: several groups are opposing the plans, including the Kew Bridge Engines Trust, 20th Century Society, Battersea Society, SAVE, and the Greater London Industrial Archaeology Society. The Victorian Society have also made a formal written objection and recorded an interview with Spectacle on their attitude towards the developers’ plans.

Even supposing the planning proposal is given the go-ahead, it’s unclear how valuable the site will be, given REO’s reluctance to say what proportion of the site will be made up of affordable housing.

Even now, when the site has none of the “essential” planning permission in place, the valuation of £388m suggests a value-per-acre of £10m. A little high, perhaps, given that Capital & Counties exhibition centre in Earls Court, which already generates income and has ready transport links, is valued at £6m per acre.

This second point of transport links, and the extension of the Northern line to Battersea, is also up for discussion.

No public money is being put towards it from either the mayor’s office or the Department of Transport, so it looks like it would have to be privately funded. The REO’s estimated cost at the moment is £200m – seen by some as a hopelessly optimistic figure.

And even if the price of building the tube link remained on target, it’s uncertain where REO would find £200m, given the company’s unfortunate financial position and hefty debts.

It’s hard to see how a valuation of the Battersea Power Station site, and of its worth to the developers, can be at all conclusive. £388m is an attractive figure for a company mired in debt, but to anyone else it looks optimistic at best, and at worst completely unrealistic. It is also £12m less than REO paid for the site.

Click Battersea Power Station for more blogs
Or visit PlanA our general blog on urbanism, planning and architecture.
See our Battersea Power Station project pages for more information and videos.

Spectacle homepage
Befriend Spectacle.Docs on Facebook
Follow SpectacleMedia on Twitter

Listed but not protected

Battersea Water Pumping Station is Grade II listed but not protected.

The usual safeguards against demolition of a heritage building are under scrutiny as REO, “developers” of Battersea Power Station, seek to bypass the criteria for demolishing a listed building and bulldoze the Victorian Battersea Water Pumping Station. Under new policy guidelines, REO will no longer need to administer the test criteria before destruction of a heritage site. REO state they “are not seeking to justify demolition on the basis of Policy HE9.2(ii)” Conveniently, REO is not in violation of policy and in effect giving them the right to proceed without obstacle.

A summary of the criteria for demolition under Policy HE9.2(ii) of PPS5 are to prove they are unable to:

1. find a “new use” for the building
2. maintain existing building  use
3. find a charity group interested in the building
4. get a local group willing to take on the building
5. market the building – someone could use it for alternative means

The community group Battersea Power Station Company has in fact offered to purchase the building for a nominal sum for a community centre, the building is described as “fairly robust and would be restorable if somebody wanted to.” However, under Policy HE9.2(i), REO claim they will not need to go through the test criteria listed. REO claim they can reject applications for the building arguing “the requirement to market the property is not engaged, since that only relates to Policy HE9.2(ii) and not to Policy HE9.2(i).”

Furthermore, under the new policy, REO “justifies the demolition of the water pumping station by reference to Policy HE9.2(i) of PPS5. Our position is that the demolition of the pumping station is justified by the delivery of the substantial public benefits inherent to the regeneration scheme [REO] are promoting, that outweigh the building’s loss, and that retention of the building would compromise the delivery of the comprehensive scheme.”

REO’s superfluous argument that the water pump station must be demolish or it will jeopardize the entire regeneration project for this area remains unfounded.

In fact, there are approximately 20 hectares of land for redevelopment.  It is perplexing that the developers are not willing to revise their plans for redevelopment to include the heritage site. Alex Baldwin of the Victorian society confirms that the demolition of the site would be a “considerable loss and unnecessary waste of a valuable historic building.” She goes on to say that the Battersea Water Pumping station is “integral to the redevelopment and regeneration of the area.  Demolition would degrade the area of the site and call into question the listing process as a whole.  The developers have not fulfilled the testing criteria for demolition, nor have they gone through re-qualifying their scheme for regeneration.”

Examples of successful redevelopment of historical sites can be found in Nottingham, Crossness in East London, Abbey Mills, and Dean Clough Mills in Halifax. The rejuvenated historical sites have revitalized the community and the same could be done for Battersea. Governments should include historic sites in the redevelopment schemes and not deem them mutually exclusive to the social and economical regeneration linked to a community.

By proceeding with the redevelopment proposed by REO, a precedent is set forth in how to undergo regeneration schemes in London. It is not good practice to use this as a blank slate for developers to demolish historical sites for the profit of a selected few. It is imperative to uphold government policy regarding the demolition of these irreplaceable iconic symbols. Once they are gone, we will never be able to get them back.

Quit putting a goddamn dollar sign on every fucking thing on this planet – Bill Hicks

Click Battersea Power Station for more blogs
Or visit PlanA our general blog on urbanism, planning and architecture.
See our Battersea Power Station project pages for more information and videos.

Spectacle homepage
Befriend Spectacle.Docs on Facebook
Follow SpectacleMedia on Twitter

Owners of Battersea Power Station, Treasury Holdings/ REO, have submitted an application (ref 2009/3578) to demolish Grade II listed Battersea Water Pumping Station.  Battersea Power Station Company, a not for profit local organisation set up by members of the Battersea Power Station Community Group, have sent Treasury Holdings/ REO a letter expressing an interest in purchasing the building for local community and heritage use

A copy of the letter can be seen below, if you support this letter please comment below and directly to Wandsworth Borough Planning department

8th June  2010

Mr Jeremy Castle
Treasury Holdings
Battersea Power Station
Kirtling Street
London SW8

“Dear Jeremy,

BATTERSEA WATER PUMPING STATION

I am writing concerning your application submitted last year for listed building consent (ref 2009/3578) to demolish Battersea Water Pumping Station.

Members of Battersea Power Station Community Group set up this company in 2002 as a not for profit organisation to carry out useful work in the Queenstown ward, one of the most socially disadvantaged areas of the London Borough of Wandsworth. The company has broad objectives, including: “The preservation of buildings or sites of historic, architectural or industrial importance, in particular Battersea Power Station and Battersea Water Pumping Station”.

In pursuit of this objective, we wrote to Wandsworth Council in January to object to your application. (Our letter of 19th January.) We have also written to English Heritage. We don’t know the outcome of Wandsworth and English Heritage’s deliberations at this stage.

In considering this application however, both organisations will have to take account of government guidance on demolition containing in the new Planning Policy Statement 5. As you know PPS 5 includes guidance for situations where the loss of a “heritage asset” is proposed. This is contained in paragraphs HE9.1 to HE 9.5, requiring alternative uses to be considered, and for charitable or public ownership to be considered as well.

Paragraph HE 9.3 specifically says “… local planning authorities should require the applicant to provide evidence that other potential users have been sought through appropriate marketing and that reasonable endeavours have been made to seek grant funding for the heritage asset’s conservation and to find charitable or public authorities willing to take on the heritage asset.”.

To assist you in this process therefore, we confirm that we do wish to acquire Battersea Water Pumping Station from you. We are willing to raise funds to repair the building, using the Architectural Heritage Fund, the Heritage Lottery Fund and other local sources. Indeed on 10th May, BPSCG members attended a seminar at the HLF about funding for Industrial, Maritime and Transport Heritage projects in London.

We saw in our recent visit to the Pumping Station on 11th March (which you kindly arranged for us) that the brick structure of the building is fundamentally sound. The building is eminently reusable in any number of socially productive ways, that would far outweigh the nominal benefits of building another hotel, office building, or shopping mall on this area of the site.

Clearly there have been years of neglect. The guidance note accompanying PPS 5 (paragraph 96) is clear that the purchase price should be reduced to take account of a backlog of any repairs. We are therefore wiling to take the building from you for a sum of £1. We would also ask for a small donation from you to assist with emergency repairs, and to serve as matched funding in any approach to funding bodies.

We also consider that the narrow strip of land extending from the pumping station to the river should stay with the pumping station to facilitate river related use such as a boat house. The building was separately owned by the water board until the 1980’s on a plot of land with a river frontage. We feel that building and its site should be preserved intact. This strip is at the north east corner of your site and we don’t see that its forfeiture would in be to the detriment of your wider plans. Indeed, it could serve as a useful buffer between your site and the refuse transfer station.

Aside for the inherent industrial and historic importance of the building, that overwhelmingly justifies its retention, there are many social benefits to our company taking over this building. For instance in enabling people from the estates on the south side of Battersea Park Road to take part in river related activity of all kinds.

Clearly bringing this building back into use on the short to medium term will also give positive signals about the viability of the site as a whole to potential investors. They will see that things are actually happening, rather than the procrastination and delay which has become the norm. This can only be in your interest as well.

I hope you find the foregoing of interest. Perhaps we discuss this proposal in more detail when we meet on 14th June, which I am very much looking forward to.”

Yours sincerely,

Keith Garner
Director

Click Battersea Power Station for more blogs
Or visit PlanA our general blog on urbanism, planning and architecture.
See our Battersea Power Station project pages for more information and videos.

Spectacle homepage
Befriend Spectacle.Docs on Facebook
Follow SpectacleMedia on Twitter

Olympic Blues

BATTERSEA POWER STATION AND OLYMPICS 2012: LEGACY, LAND GRABS AND LIBERTIES

Mark Saunders talk and videos

Wednesday, 02 June 2010 17:30

Room 517 (5th floor), Bartlett School of Planning, UCL, Wates House, 22 Gordon Street, London WC1H 0QB.

Directions

More info on London Planning Seminars

For more info:
On the Olympics:
Project: http://www.spectacle.co.uk/London-Olympics-2012
Blog: http://www.spectacle.co.uk/spectacleblog/category/olympics-2012/

On Battersea Power Station:
Project: http://www.spectacle.co.uk/Battersea-Power-Station
Blog: http://www.spectacle.co.uk/spectacleblog/category/battersea-power-station/

Developers REO want to demolish Battersea Pumping Station

Last week’s blog entry on Battersea Pumping Station focused on the frailty of the argument behind demolishing the building by current developers REO / Treasury Holdings. The pump house is a listed building at Grade II and pre-dates the power station by several decades as it was built in 1850. It has suffered from the same neglect that has befallen the power station, and like the sleeping giant that dwarfs it, it has been proclaimed as unrestorable by the developers and therefore fair game to be knocked down to make way for gated communities and a retail hub.

Yet much is being ignored here. The new Planning Policy Statement 5 declares that the council must take into account not only the possibility of sustaining and restoring a building of historical significance, but also weigh up the loss of heritage that would disappear along with the building against the desirability of any new development and the effects of both actions on the local community.

Kew Bridge Engines Trust, 20th Century Society, Battersea Society, SAVE, Greater London Industrial Archaeology Society, and also The Victorian Society (whose have posted a formal written objection and recorded an interview with Spectacle on their attitude towards the developers’ plans), are amongst many significant organisations to have questioned the planning application. And with good reason.

The developers are playing the practical usage card, and are shrewdly associating the building’s dereliction with inaction and obsolescence. However, Spectacle followed a team of architects who declared the pumping station structurally sound, and therefore transformation must subjugate destruction according to PPS5, but in what capacity?

Papplewick Pumping Station, above, is an illustration of a successful restoration on multiple levels. Built a few decades later, the water pumps are back in full working order and as a museum the station is an important focus of historical and engineering study. English Heritage, who have for the past few years failed to back any substantial arguments for preservation, have conversely put money into the ongoing restoration of Cross Ness Pumping Station, which includes plans for use in an educational context, and will be finished in 2011.

For Battersea, the local industrial heritage could play a huge role in the redevelopment of the power station site. Other suggestions include an exhibition space for artists and musicians, as well as a provision for housing archive materials indispensable for environmental, archaelogical and architectural study.

Beyond the functional potential for the site, it would reverse years of association with apathy and inertia, and could instead by synonymous with ingenuity, innovation and regeneration, perhaps even ultimately rousing support for a more public discussion on plans for the site’s regeneration.

A decision on the current application will be made by Wandsworth Council in July. It is not too late to register your comment or objection to its demolition.

Click Battersea Power Station for more blogs
Or visit PlanA our general blog on urbanism, planning and architecture.
See our Battersea Power Station project pages for more information and videos.

Spectacle homepage
Befriend Spectacle.Docs on Facebook
Follow SpectacleMedia on Twitter

The future of Battersea Pumping Station, located next to the Battersea Power Station, is in serious doubt. If the current planning application to redevelop Battersea Power Station and the surrounding land by REO / Treasury Holdings is accepted without alteration by Wandsworth Council in July, the Grade II listed building would be demolished under assertions by the developers that the scheme would not be economically viable with its continued existence.

However, evidence to support this claim is less than accurate. Neither in the private nor public domain have the developers or Wandsworth Council revealed the percentage split of affordable and luxury housing. Without knowing what percentage of the planned housing developments will be “luxury” or affordable apartments it is not possible for REO, let alone English Heritage, to know how much profit the developers will make, therefore arguments over the economic viability of the scheme are spurious. Assuming the developer calculated the minimum amount of “affordable” flats would be needed the issue is not the economic viability of the scheme but the size of REO/Treasury Holdings profit margin.

REO argue that the Pumping Station should be demolished for the “Community benefit” but what they mean is their profit. It is becoming depressingly common for developers to present their economic interests as a community benefit. In this case what is actually meant is that if the developer does not get its way and make a substantial profit then the scheme will not go ahead and the community will suffer decades more planning blight.

Despite formally submitting their application in November 2009 in which they declared that flattening the pumping station would be critical, in February the only definitive number of houses of the 3856 dwellings of the master plan given any ‘status’ whatsoever are the 245 build-to-let houses – classified as non-affordable. As recent as March this year, in a Q & A session with the Planning Director Jeremy Castle, the percentage of affordable housing against non-affordable had still yet to be decided.

English Heritage, an organisation whose official remit is to promote and protect Britain’s historical environment, have effectively given their blessing to REO by deferring any decision-making responsibility to the Local Planning Authority.

In a letter to the Local Planning Authority, Nick Collins stated that although the proposed plans “risk causing harm to the setting”, the decision ultimately rests on assessing whether or not the ‘substantial community benefit’ (community benefit in this case being  private gain) outweighs the loss of the building and whether or not the building could be bought up by another party and reused (you can see the new legislation PPS5 here).

Under this new legislation the council must establish no other organisations are interested in buying the building or that no alternative community use can be found. Battersea Power Station Community Group has registered its interest and is supported by  a number of  local and special interest groups.

The Victorian Society is one of a number of expert groups who are against demolishing  the Pumping Station, yet they have been ignored (see the interview with Alex Baldwin from The Victorian Society here).

Jeremy Castle plans to reveal the official percentage of affordable housing on June 15^th – less than a month before Wandsworth Council make their final decision on the application. Aside from the absurdity of demanding a 150 year-old building be torn down because ‘it might be handy’, the relinquishing of accountability by organisations like English Heritage  demonstrates an alarming and depressing deference to private business when they are funded to enforce and support preservation.

The exhausting planning process and massive application documentation helps developers like REO / Treasury Holdings to wear down any resistance and bury the fact that they intend to destroy historically and culturally significant sites without open discussion. As English Heritage have in recent years funded the restoration of Cross Ness Pumping Station, their dereliction of duty and unfounded support for the vandalism of Battersea Pumping Station is curious.

Click Battersea Power Station for more blogs
Or visit PlanA our general blog on urbanism, planning and architecture.
See our Battersea Power Station project pages for more information and videos.

Spectacle homepage
Befriend Spectacle.Docs on Facebook
Follow SpectacleMedia on Twitter

The comments below are from Chelsea Bridge Wharf resident Mike O’Driscoll, who is one of a  significant number of residents to have lodged formal objections against the Battersea Power Station plans.

The issues mentioned in your post concerning formal objections by residents of Chelsea Bridge Wharf to the current development plans for Battersea Power Station are worrying for residents but what is more worrying for the area, and for London as a whole, is that Wandsworth Council and the developers are clearly trying to fudge the issue of how much affordable housing would be included in the development. When so many people cannot afford a home it would be obscene for this development to go ahead without insisting on 50% of homes being affordable.

The Council is however refusing to say how many affordable homes would be included and claims that it is unable to say how many there would be because it is not clear what the demand is! I suggest you write to Mr Bob Leuty at Wandsworth Council (planningapplications@wandsworth.gov.uk) and make it clear that you do not support any development unless it includes 50% affordable housing. You can also contact your Wandsworth Councillor, or your local MP, and ask them what their view is on this before deciding how to vote.

If we allow this development to continue without clarification on the issue of affordable housing then we are simply allowing the developers to make themselves even richer and making this area even less diverse socially.

Click Battersea Power Station for more blogs
Or visit PlanA our general blog on urbanism, planning and architecture.
See our Battersea Power Station project pages for more information and videos.

Spectacle homepage
Befriend Spectacle.Docs on Facebook
Follow SpectacleMedia on Twitter