12 The architect's original design was to a high specification. The building, which is likely to be fit for the FCO's purpose, is now due for delivery in June 2000, eight months later than originally intended - a major element of the overrun arose from changes to the Berlin building regulations.
13 The FCO has the right to occupy the building for 30 years with a possibility of renewing occupation for a further 30. The FCO may share occupation of the building with third parties and obtain income for doing this. In addition, the FCO may occupy the building after 30 years by negotiating new terms or terminating the operator's agreement.
14 The FCO allocated risks appropriately in most key areas achieving a notable success in ensuring that all of the unitary payment is at risk under the contract, and passed over those construction risks which are usually transferred to the private sector in PFI projects and instituted a performance payments regime which transfers a good deal of performance risk to the consortium. The risks relating to the development of the design were shared, the FCO transferring risks associated with completing the design to the supplier.
15 When letting the contract, the FCO estimated that there was a small price advantage in the PFI deal compared with the cost of a conventional procurement. This view was based on a broad judgement of the estimated total costs of the PFI and the conventional projects. The value for money comparison is sensitive to assumptions made about the level of operating costs, risks, and the future exchange rate between sterling and the German mark, and the FCO examined these sensitivities and reflected them in their calculations.
16 The requirements of an Embassy are complex and there were specific planning constraints on this historic site. Because bidders adopted the outline design which had already been developed by the architects, the scope for them proposing design innovations was further limited. And the need for the FCO to take account of security requirements meant possibilities for innovation in design were constrained. The FCO have managed to achieve some innovation in the construction phase.
17 The FCO were advised by Dibb Lupton Alsop solicitors and Greenwich NatWest as financial advisors, with Chesterton Consulting (Katalysis) and Schal Property Services (Carillion) as technical advisors. A Berlin-based law firm advised the FCO on German law aspects of the transaction.