The government will this week announced a shortlist of six bidders to enable The Department of Social Security (DSS) to transfer 700 offices to the private sector under the Private Finance Initiative.
The contract winner will be required to provide accommodation as well as maintenance, facilities management and possible other services such as catering. The plan is described as one of the most ambitious property transactions ever attempted in the UK. The net present value of the deal over 25 years could be between £3bn and £4bn although the capital proceeds are likely to be much less.
Other government departments will be tempted to aim for a wholesale transfer of their office properties if the DSS deal is successful. Most of the 10m sq m (110m sq ft) of office space occupied by central government could be transferred under the PFI. Such an outcome would spark a revolution in the property market.
- Financial Times 20/08/96 page 6
