The Dockyard building deal makes no financial sense

The Dockyard building deal makes no financial sense

On any honest and objective analysis, the sale of a huge warehouse building at the Dockyard
site at 80a Queensway by the Government to then rent it back on a 21 year lease from the same
private group to house Government departments simply does not make financial sense.

The Government has now admitted that the construction phase has taken long. What its
response discloses is evidence of mismanagement which needs to be added on to the GSD’s
questions regarding the value for money aspects of the deal. To admit that the need to have
basic, modern office requirements such as, for example, air conditioning or parking spaces as
the reason for delay shows that these obvious features were not considered when the
Government decided it was a good idea to start paying a monthly rent at close to £90,000,
before occupation takes place. This bad deal would have perhaps been more palatable if the
rental cost did not kick in until at least until occupation started.

The effect of the timelines now announced by the Government is that the cost to the taxpayer
for an empty or part empty building will come to about £2.3M – and almost 3 to 4 years in
from when the 21 year term of lease started.

The fact is that the lease was entered into in September 2023 and the Government should have
had the foresight to have had all these issues factored in before signing off on it.

Damon Bossino said: “Furthermore and given that the Government has now confirmed that a
contractor has been appointed, it now needs to state what the conversion from a big warehouse
store to “fit-for-purpose” offices will cost the taxpayer. This figure now needs to be added on
to the £87,000 monthly or in excess of £1M annual expense.

No one in the private sector, using their own money, would proceed in the way this
Government has.”