SP Setia: Analysts Maintain Hold on Battersea Project as UK Market Challenges Persist

KUALA LUMPUR – SP Setia Bhd (SPSB MK) remains cautious on its flagship Battersea Power Station (BPS) project in London, noting that while the development has transformed into a vibrant destination, profit visibility remains limited in the near term. The company reiterated its HOLD call with a target price of RM1.10, citing persistent challenges in the UK property market despite improving footfall at The Power Station retail mall, which recorded over 13 million visitors in 2024 with a further 10% year-to-date increase.

Battersea Power Station Gains Traction

Phase 3C, a senior living project, is now the main focus, with future phases to be launched depending on market demand. A key tenant’s rent-free period will end in September 2025, with renewal due in 2026 at higher market rates driven by strong demand for green-certified buildings. While recurring rental income is still at an early stage, management expects contributions from Phase 3C by FY2026. Analysts caution, however, that profit delivery from BPS may take longer under ongoing UK property market pressures.

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