TNAG-2962-FCO40-4241-Future-of-Hong-Kong-British-Consulate-General-building-incl-1993 — Page 60

22 November 1993

Mr B G Marr

HM Treasury

Parliament Street

London SW1P 3AQ

HONG KONG: NEW CONSULATE-GENERAL

1.

Thank you for your letter of 22 July 1993 which approved

£3 million for the stages up to, but excluding the main works

contract.

2.

We have now completed our appraisals of the Final Sketch

Designs and Report. We conclude that the future Consulate General, as now designed, will satisfy all HMG's post 1997

needs and house them in a fitting building of quality that provides good value for money. The revised total estimate project cost now stands at £28,450,000, which compares with

the Treasury published Supply Estimates for 1993/94 which

state in table 1 that the cost of the project is £29m. The

difference between the current and previous cost estimates is

due mainly to fluctuations in Rate of Exchange; see item 22 of the attached Project Approval Proforma.

3.

I also enclose updated DCF appraisals of both this project and the only other realistic option i.e. renting. As stated

in para 3 of my letter to you of 7 June 1993 we fully appraised in 1989/90 other options and all those that included land cost elements remain relatively much more expensive in

comparison with building on the free Colvin House site.

reasons for discarding other possible options remain as

The

(t.marr.NATjoyce

Page 60Page 61