TNAG-1636-FCO40-2252-Visits-by-FCO-officials-to-Hong-Kong-1987 — Page 74

CONFIDENTIAL

planned speculative office accommodation; or to take over

part or the whole of an existing building in the

non-commercial office market.

15.

The

Even

On the first option, a new build entails the

acquisition of a site either by purchase or lease.

land costs, even outside Central, will be very high

indeed, as values reflect the high density of development

permitted and the high level of commercial demand.

at 15,000m2 of floor space, our needs represent only a

small proportion of the potential of a normal development

site and the land costs would therefore be out of our

reach, unless some kind of concessionary deal could be

done (or additional FCO funding obtained).

Sales in

Central suggest that a site will cost between £4,500 and

£6,000 per square metre.

Three potential sites have been identified by the

Hong Kong Government:-

Location

Size m2

Value HK$ Value £

(a)

Garden Road

6,700

360m

30m

(b)

Victoria Barracks

14,370

1,005m

84m

East

(c)

Fleming Road

6,000

300m

25m

These enormous land costs, even if the sites could

be sub-divided, in relation to our relatively small

requirements suggest that the option to build is not

CONFIDENTIAL