Parkview in dispute over London deal

HONG KONG Parkview is coming under heavy criticism from British construction group McAlpine for refusing to honour agreements struck by the two companies over Battersea Power Station, a south London landmark whose principal debt was purchased by the Hong Kong property developer last year.

Sources close to McAlpine are furious that following legal proceedings to establish the ownership of contested steel supports erected on the building, Parkview is reneging on assurances given that it would purchase the supports if McAlpine could prove ownership.

Days before the case was due to be heard in the High Court last month, McAlpine produced documentation showing that it owned the supports, valued at between GBP750,000 (about HK$8.91 million) and GBP1 million, and that they were not part of the deal negotiated by the Parkview group when it acquired control of the site.

However, a spokesman for Parkview and the repossession agents, Semisquare, appointed to handle the takeover of the power station, said that the company accepted that the supports belonged to McAlpine, but that it was not willing to pay for them, and so they should be removed.

The spokesman added that lawyers representing Semisquare had agreed to pay McAlpine's legal costs, but also said they had written to McAlpine asking it to arrange a mutually convenient time to visit the site, and remove the supports.

He said that the request to remove the supports had been made on the basis of a report commissioned by Parkview, that concluded that the supports were not needed to keep the building up.

Nevertheless, copies of letters obtained by the South China Morning Post clearly indicate that solicitor's representing Semisquare made an unconditional commitment to purchase the supports, once ownership had been proved.

In a letter sent last year, a lawyer from the Hong Kong-based legal firm Jewkes and Partners, which at that time had been appointed by Parkview to represent Semisquare in the question of ownership, wrote: ''If your client could demonstrate to our client's satisfaction that it owns the steelwork, our client would be prepared to make a payment for the continued use of the steel.'' The spokesman said that Semisquare had made such a commitment, but that this was before the commissioned report had returned its conclusions.

''That commitment was made when we thought the supports were necessary to hold up the building.'' The building has no roof, making internal supports for two of the walls necessary.

The power station is a listed building and cannot be knocked down without permission.

George and Victor Hwang, who control Parkview, have said that any development plans will include refurbishing the building.

Parkview purchased US$70 million of the $75.8 million debt owed by Battersea Leisure, the previous owner of the site, from the Bank of America last year.

The group has been trying to devise a voluntary agreement with the creditors of Battersea Leisure, which include McAlpine and the local government authority, Wandsworth Borough Council.