5 In 1998, the Home Office had obtained three competing bids to refurbish the existing estate, proposing the existing building at 2 Marsham Street as temporary accommodation during the refurbishment. AGP, however, made a developed and costed variant bid for a new building at 2 Marsham Street. This variant was attractive to the Home Office because it presented the opportunity to house all Home Office and Prison Service staff in a single building and avoided the business risk associated with moving out to temporary accommodation and back again. Another bidder, Central Accommodation Services Ltd, also put forward a variant bid proposing a new building at 2 Marsham Street. Further competition has indicated that the Marsham Street deal is better value for money than refurbishment.
6 The Home Office also identified other potential accommodation, but it was either too expensive compared to the Marsham Street deal or the location was considered unsuitable. Furthermore, it assessed the cost of procuring accommodation through leasing a building at market rent and paying separately for services as more expensive than the Marsham Street PFI deal. Deferment of the project would have delayed the business benefits and added to the costs because of the poor condition of the existing estate.