Chelsea bids for Nama-held site

Chelsea Football Club has today confirmed a bid to build a new stadium at Battersea Power Station, a site which is partly in the hands of the National Asset Management Agency (Nama).

In a statement issued early this afternoon, the football club said it had teamed up with property development firm Almacantar to submit an offer to acquire the 39-acre site.

The bid was one of dozens submitted today for the landmark site.  Any new owner will have to pay £500 million for the power station, including £325 million to cover the debts held by Nama and Lloyds, along with a £100 million contribution to the Northern Line extension.

Nama held discussions with representatives of Chelsea's billionaire owner Roman Abramovich in November on taking over the site for a new stadium complex.

Battersea Power Station was formerly contolled by Real Estate Opportunities (REO), a listed company which is majority controlled by Treasury Holdings, the property firm owned by developers Johnny Ronan and Richard Barrett.

Nama and Lloyds Bank were given control of the landmark site in December after the British high court appointed accountants Ernst & Young as administrator to subsidiaries of Battersea Power Station Shareholder Vehicle, which own the site, and in which REO held a majority stake.

The low-capacity of Chelsea’s current ground, Stamford Bridge, which can accommodate 42,000 – about 30,000 fewer than Premier League rivals Manchester United – has prompted Mr Abramovich’s interest in moving the stadium to a new site.

REO borrowed money from Bank of Ireland and British bank HBOS to buy the London power station, which has lain dormant since 1983, before Nama acquired Bank of Ireland’s loan in 2010. Lloyds took over HBOS.

REO has planning permission for a €6.5 billion redevelopment of the building and the surrounding area into 7 million sq ft of residential properties, offices and shops.

An artist's impression of the proposed development by Real Estate Opportunities (REO) at Battersea Power Station in London.

In its statement, Chelsea Football Club said there were other parties interested in the site, adding that it was unclear whether its bid would prove successful. Making an offer does not mean the club has made a definitive decision to leave Stamford Bridge, it said.

"Working with architects and planning experts we have developed a plan to preserve all the significant aspects of Battersea Power Station. The four iconic chimneys and wash towers along with the Grade II listed west turbine hall and control room will be restored and retained in their original locations and provide a unique architectural backdrop to a world-class stadium with a capacity of around 60,000 seats," it said.

The bid submitted includes plan for a rectangular-shaped stadium with four separate stands. The club said the initial plan also includes a 15,000-all seated one-tier stand behind the south goal, likely to be the biggest one-tier stand in football.

"As well as a new home for our club, the development would include a town centre with substantial street-level retail shops, affordable housing and offices - all of which would benefit Wandsworth and bring a significant number of permanent jobs to the area. We would also make a significant contribution towards the Northern Line Extension, a new high-volume transport link proposed for the area," the club added.

However, any move could run into opposition from fans. The club tried to buy the freehold of Stamford Bridge last
year to clear the way for a possible move but the plan was rejected by the Chelsea Pitch Owners (CPO), a group of fans who acquired the freehold in 1993 to protect the ground from developers.

Wandsworth Council, which has planning authority over Battersea, is not in favour of the Chelsea bid, while Mayor of London Boris Johnson is similarly opposed.

In a statement, Ernst & Young said it was "encouraged'" by the strong level of interest, adding that recommendations on the best offers will be made shortly.

Treasury this week began legal action in Dublin challenging the appointment of administrators to its assets, but the sale of Battersea will continue.

Up to 100 viewings have been organised in recent weeks of the property, which has defied all attempts by a series of developers over three decades to do anything with it.

Besides Chelsea, the others interested include a Malaysian interest, SP-Setia; London & Regional, a company owned by the London-based Livingstone brothers and housebuilders Berkeley.

The Wellcome Trust charity has also displayed interest, along with Olympic village developers Delancey and the Hong Kong-based Hutchison Whampoa.

Battersea power station: significant dates and events

1935 Battersea power station's first plant is completed.

1953 Second plant completed and comes on stream.

1983 Battersea power station ends electricity generation.

1986 Local authorities approve Alton Towers Ltd's theme-park plan for the site.

1987 Central Electricity Generating Board sells Battersea to businessman John Broome for £1.2 million and work begins on the site.

1993 Hong Kong-based Parkview Developments buys the site and its associated £70 million debt from Bank of America for £10 million.

2006 REO – Real Estate Opportunities – buys Battersea from Parkview for almost €600 million, using money borrowed from Bank of Ireland and Bank of Scotland, among others.

2010 Nama acquires Bank of Ireland's share of the Battersea loans. REO wins permission for a €6 billion redevelopment of the site and spins the company off to a new shareholder vehicle.

2011 Court appoints administrator to Battersea at request of Nama and Lloyds.

- BARRY O'HALLORAN