Apple’s move to Battersea Power Station sparks hopes of paying off infrastructure debt early
The council leader heading up the development around the Battersea Power Station is hoping a possible boost to business rates income from Apple’s move to the site could help pay for the Northern Line extension early.
The funding for the Northern line extension, which will create two new tube stations at Nine Elms and Battersea Power Station, is underwritten by a government guarantee, and paid for in part by contributions from the developers on the Nine Elms site.
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However, when these contributions run out, borrowing by Transport for London will be serviced by business rates income from Apple and the other firms that move into the area. Business rates from the area are ring-fenced for 25 years to pay for the new infrastructure.
Councillor Ravi Govindia, leader of Wandsworth Council and co-chair of the Nine Elms Vauxhall Partnership, which is driving the scheme, said that he is hopeful that the debt can be paid off early if more businesses are attracted to the area by Apple. In September last year, Apple committed to moving to the Battersea Power Station by 2021.
"Apple has an enormous capacity to spawn a series of complimentary companies [on the site]," he said. "The future is bright."
In addition, the tax take from businesses will be boosted when business rates rise this year. Commercial property taxes in the UK have been re-evaluated for the first time in seven years, and are jumping up in parts of the capital where rents have risen.
Although many business groups have raised concerns about how business rates will affect the capital, with many worried that tax increases will put smaller companies out of business, Govindia is hopeful that in Nine Elms, the higher taxes will be used to pay off the infrastructure debt early and minimise the cost of servicing the debt.