EPF: Acquisition of Battersea assets part of real estate, infrastructure expansion plans
EPF and PNB say planned purchase in line with strategies to grow real estate, infrastructure assets globally
THE potential acquisition of Phase 2 of the Battersea Power Station project is a purely commercial decision, say the Employees Provident Fund and Permodalan Nasional Bhd. The move is also in line
with diversification plans to grow their real estate and infrastructure assets globally.
THE Employees Provident Fund (EPF) and Permodalan Nasional Bhd (PNB) say the potential acquisition of Phase 2 of the Battersea Power Station (BPS) project is purely a commercial decision.
This was in line with the funds’ diversification plan to actively expand their real estate and infrastructure assets globally, said EPF and PNB in a joint statement yesterday.
“The EPF has been actively expanding its real estate and infrastructure assets both domestically and overseas to deliver long-term sustainable income for the benefit of its members.
“The proposed transaction is also in line with PNB’s Strategic STRIVE-15 Plan which outlines a long-term strategy of portfolio diversification and judicious expansion into global assets,” said the funds.
EPF and PNB on Thursday announced that they had signed a heads of terms with Battersea Phase 2 Holding Co Ltd to initiate preliminary negotiations to buy commercial assets in Phase 2 of the BPS development for around £1.61 billion (RM8.8 billion).
“The EPF and PNB are now contemplating to acquire ownership in Phase 2 of the project, known as The Power Station building, which is the anchor project consisting mainly of retail and office spaces.
“We view this as a strategic opportunity to secure ownership of a unique and iconic real estate asset in a global city, which will be able to deliver a sustainable income stream into the future to meet their respective income needs,” they said.
The EPF and PNB dismissed claims that the acquisition was part of government intervention, saying the decision was purely an investment consideration initiated together with the BPS board and management team.
“The EPF and PNB are steadfast and committed to upholding the trust of the two institutions’ members and unit holders, respectively, as well as the Malaysian public. Any inferences that investment decisions are made for any other reason than for the benefit of the people are completely false and malicious,” they said.
Phase 2 of the project is expected to be completed by late 2020 and has also been pre-let to anchor tenants such as Apple, one of the world’s leading technology companies, for a 500,000 sq ft tenancy — in one of London’s largest-ever office pre-lets.
The funds said this boded well for potential investors as it was seen as a precursor to an exciting future for the BPS development.
“The purchase price, which is still subject to further due diligence, has been structured based on a completed and tenanted basis to provide attractive long-term yield for the investors,” they added.
The EPF is part of the consortium, consisting of SP Setia Bhd and Sime Darby Property Bhd which began in 2012 the BPS project with the entire development spanning Phase 1 to Phase 7.
EPF directly owns 20 per cent of the project and PNB holds majority stakes in SP Setia and Sime Darby Property, which collectively own 80 per cent equity in the BPS development.