TNAG-2961-FCO40-4240-Future-of-Hong-Kong-British-Consulate-General-building-incl-1993 — Page 96

CONFIDENTIAL

goodwill in Hong Kong generated by the Government's efforts over the Nationality Bill to clinch a substantially better deal than would have been

achievable. The next step will be for him to seek ExCo's approval to make HMG a Private Treaty Grant of land at nominal costs (less than £100) on a well located site

close to the Central District on Hong Kong Island, known

as the Colvin House site.

5.

This is a major concession

H

worth over £20 million

at prevailing land prices. It brings the cost, in capital terms, of building a free standing Consulate

General below the cost of all the other options which we

also explored, such as joint development and shared use

with a commercial developer of a high rise building, or

renting parts of other buildings. Moreover, none of

these other options would have gone as far towards meeting our agreed objectives.

6. The Colvin House site is large enough for a substantial free-standing building housing not only the

Consulate General, but also the British Council, a large

Immigration Section and some residential accommodation.

7. A building of this size and quality would satisfy all

HMG's post 1997 needs, as well as meeting the political

requirements described above. Under the arrangement we

have negotiated, we would meet the construction costs.

We estimate these to be in the order of £20 million and I

included this figure in my present PES bid. We will

effectively get a building at half-price.

CONFIDENTIAL