Battersea Prime Residential Property

17.03.15

Fuelled by rising levels of investment by developers, a need to house a growing population and increasingly sophisticated buyer tastes, London’s residential axis is shifting, with Battersea staking a claim, says Andrew Reeves co-founder of London-based prime residential property services group Totalis Prestige

To what do you attribute Battersea for being catapulted into the realm of Central London greatness?
I liken the regeneration of Battersea to that of Mayfair during the 18th century, when 285 acres of poor quality farmland and marshes were drained by the Grosvenor Estate to create the most desirable district in London as a magnet for the aristocracy of the day.

Stretching south from the river Thames, Battersea has been transformed in recent years into one of the most sought-after and popular residential areas in London, with easy access to the City and West End; and things are set to become a whole lot better.

With its magnificent open spaces, fabulous choice of shops, restaurants and excellent schools, the area attracts a vibrant mix of young professionals and families alike, many of whom have migrated south of the river from the more expensive areas of prime central London such as Kensington and Chelsea.

Redevelopment of Battersea Power Station and Nine Elms has finally commenced. It is by far the largest and most exciting regeneration zone in central London and includes gentrification of the last remaining light industrial space, with 3km of the Thames riverside being opened up to the public, creating a brand new stretch of London’s South Bank.

The imminent arrival of the American Embassy is spurring the relocation of other diplomatic missions south of the river. The Chinese government has shortlisted the area for its new diplomatic headquarters. Blue chip corporations are due to follow, which will also boost investment appeal.

The area is set to become a modern, exciting and prestigious destination – a vibrant, culturally stimulating place with a broad range of visitor attractions, shops, community facilities and internationally recognised landmarks; a remarkable new riverside district with character for central London, where people will choose to live, work, visit and relax.

Do you see the high end core Battersea zone helping to gentrify offshoot areas?
Battersea has already seen a sharp increase in the number of professional residents moving into the region from north of the river. The area offers a wide variety of property to satisfy all tastes and has grown in popularity during the last few years, specifically from well-heeled families snapping up family houses, heralding the term ‘emerging prime’.

Conversion flats, Victorian and Edwardian period houses, tree-lined streets with grand mansion blocks such as Prince of Wales Drive on the southern side of Battersea Park all dominate the area; in contrast, there are also an increasing number of contemporary apartment block developments on the western end of the river side, designed by award winning architects such as Richard Rogers and Norman Foster.

The Shaftesbury Estate in the north of the area was built in the 1870s to provide housing for the local workforce. It is now a conservation area and provides cottage style houses which recently have become very popular with professionals who seek a house rather than a flat; it is close to Battersea Park, Queenstown Road and Clapham Junction mainline rail stations. Beyond the Shaftesbury Estate lies the Diamond Conservation Area which also provides well built houses and maisonettes on tree lined streets.

Which residential projects do you consider a case study success story for developers and buyers alike?
During the last few years, riverside developments along the Thames have flourished in popularity and the Battersea/Nine Elms regeneration scheme is at the pinnacle of this, virtually selling all property stock as it becomes available and managing to secure a vast array of retail tenants, boutique hotels and corporate investment.

The great advantage with Battersea over other development locations in London, is its close proximity to the west end and central London. We advised our clients back in 2012 to invest in the first phase of the Riverlight Nine Elms development. At that stage, building work had hardly begun and we worked closely with our clients advising them on the nuances of purchasing property ‘off plan’. In a rising market, an off plan purchase can make significant gains in capital growth even before completion, but it is also vital that due consideration be taken to a myriad of influencing factors such as stock availability throughout the build process, potential view restrictions due to future developments and even whether a client would prefer an east or west facing balcony.

The huge interest in this development generated from around the world, especially from Singapore, Hong Kong and China; clients who secured properties early in this development have already seen exceptionally high returns on their investments, with growth of over 130% during a timeframe of just three years. This insatiable appetite for high quality is set to make Battersea an extremely high-end core zone district of London for many years to come.

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2019 will see the area move one step further when the Northern Line is extended and the district blessed with its first London Underground link – where do you see prices heading at this point?
A £1billion transport improvement package, together with the existing CAA approved heliport in Battersea, will make Battersea and Nine Elms on the South Bank one of the most accessible and well-connected parts of central London.
Two new Northern line stations at Nine Elms and Battersea Power Station will create fast, direct links to the West End, City and North London, cutting travel times to the City (12 mins) and Leicester Square (14 mins).

The Vauxhall Gyratory will be remodelled to create a more pedestrian and cycle friendly environment and a new foot bridge across the Thames will link the area to Pimlico and Chelsea on the opposite bank.

For those who purchased in Battersea during the last five years, property has been a very sound investment, with spectacular capital growth during 2013 and 2014 exceeding that of prime central London.

However, as befits an election year in the UK and with the potential for further taxation of high value property, demand levels dropped during the first quarter of 2015 and, as a result, so have transactions and values. Across prime London, the average price paid per square foot was 0.5% lower when compared with the first quarter of 2014. This rate of annual price change represents a slowdown from the end of 2014, when prices were rising at an annual rate of 11.4%.
Whilst it all hinges on confidence, I hope a stable market will prevail as key indicators show a likely bounce back as we approach the all-important autumn market, with five years price growth forecasts for London of between 20% to 25% widely reported.

If you were advising investors to snap up a bolthole in Battersea – where would you recommend they buy for capital appreciation and also the liveability factor?
When considering where to make your next property investment, either in which to live or to let, it is important to understand the ‘ripple effect’ that gentrification brings to an area; with the key criteria being able to spot where those next up-and-coming areas will be, ideally before anyone else.
Regeneration of the Battersea district still has a way to go, especially when looking from the perspective of the buy-to-let market. Take into consideration the emergence of the ‘diplomatic district’ alone, with the many thousands of employees and visitors that both the American and Dutch embassies will attract to the region, and you start to understand why Emerging Prime is now seen as the sweet spot of the professional private rented sector.
Rents in Emerging Prime have been growing steadily in recent months, further strengthening the allure of the area for investors; whilst in adjacent Clapham, smaller unit sizes, particularly flats, are attractively priced for investors hungry for

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