The chief executive of Battersea Power Station Development Company has said the oversupply of high-end homes in Nine Elms is a ‘myth’ and insisted there will be no development slowdown
Rob Tincknell told the AJ’s sister publication Construction News there was a ‘huge demand’ for real estate in central London and that he ’utterly and strongly’ disagreed there was an oversupply of high-end homes in London’s Nine Elms.
The Nine Elms development area is home to a long list of projects at various stages of development, including Battersea Power Station, Berkeley Group’s Riverlight project and Ballymore’s Embassy Gardens scheme.
Tincknell said: ’There is a huge demand for real estate in central London and the only projects that are really being built at the moment [in Nine Elms] are Riverlight, which is 85 per cent occupied for the buildings that have been completed, and Embassy Gardens.
‘The rest is in the development phase, so the talk of oversupply I would utterly and strongly disagree with.’
He added: ‘Everything that is put on the market is generally sold to owner-occupiers, so how can there be an oversupply? An oversupply would be thousands of homes on the market and nobody buying them.’
His comments came after City AM reported that more than 50 luxury flats on sale at Battersea had their prices slashed over the last three months, with reductions of up to 38 per cent.
Tincknell said ’a few people’ had reduced high asking prices to more ‘realistic levels’ but insisted this did not reflect a ’massive drop in prices’.
Out of the 1,500 properties that have been sold over the last three years, only 10 per cent have been re-sold, the chief executive said.
He added that the team only needed to sell 1,500 homes at this stage and was now focused on the delivery of commercial units.
On the construction work being carried out to date, Tincknell said he had a ’huge amount of high regard’ for Carillion on phase one.
However, he admitted the contract had yet to be signed with Skanska for phase two.
‘The power station [phase two] isn’t easy. It’s a very challenging project so getting to an agreed contract is taking a little bit longer than we hoped because of the complexity of the power station,’ he said.
The developer mooted the idea of setting up a tier one contractor framework similar to the agreement Argent has with Bam, Carillion and Kier on its King’s Cross regeneration as competition to secure contractors on schemes ramps up.
’We’ve got a fantastically strong relationship with Carillion, so it seems daft that we don’t use and strengthen that relationship – rather like [Argent’s] King’s Cross. I think there’s a lot of merit to working with contractors again and again and giving them that future workstream.’
Tincknell voiced his concerns over the future supply of labour in the construction industry if the UK were to leave the EU.
’About 70 per cent of the guys working at Battersea station are from other parts of EU, that is where the labour comes from across London.
’We have 28 nationalities working on this project. If we close our doors we have got to make sure the labour market for construction remains open, otherwise we are going to have a major, major problem for the construction industry.’