The stock market and the currency seem to have stabilised somewhat after a few days of uncertainty, fear and chaos. Perhaps people have realised that referendum (BREXIT) has ended but nothing has changed just yet. It may change in the future but as of now, the UK government has not yet even submitted their application to leave the European Union. It would also not be sooner than after the appointment of a new Prime Minister to replace David Cameron. This is expected to be in September 2016 or later. There are also news that London’s loss may be Asia’s gain. I also still think this is too early to tell. If I am one of those super-wealthy, London remains my choice. European Union is a huge market but London remains a capital for many things in the world today.
The developers with exposure to London is currently under scrutiny and one of them have announced to the prospective investors that everything just fine. SP Setia said that it is positive with the long term prospects of Britain’s Battersea Power Station and the uncertainty currently will not stop from completing the project. It has a 40 percent stake in the project together with Employees Provident Fund (20 percent) and the Sime Darby Group (40 percent).
Results thus far is encouraging. It has sold 85% from the total of 1,661 units launched for Battersea in three phases. In fact Phase 1 is scheduled to be completed and delivered on a staggered basis starting Q4 2016 till Q2 2017. (Yes, my neighbour’s son owns a unit). SP Setia said that due to this completion, there would be some recognition of profits from Phase 1. This will however be reinvested into the development of Phase 2 and Phase 3 which are expected to be completed in 2020. Thus, any fluctuation in pound sterling is okay as profits remain invested in the project for the longer term. Happy thinking and investing.
written on 30 June 2016
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