2.5 MOD considered a range of alternative options for providing accommodation for its London-based staff prior to assessing the market's interest. Those options were:
■ full demolition and rebuild of Main Building;
■ relocation to a greenfield site;
■ relocation to a new central London site; and
■ redevelopment of Main Building.
2.6 MOD rejected the relocation options because of the cost of moving the Defence Crisis Management Centre from Main Building and Ministers' need for the MOD Head Office to remain at the heart of Government. It rejected demolition and rebuild as it thought it was too risky in planning terms, (Main Building is grade 1 listed), was a more expensive option and there would be difficulties in retaining the Defence Crisis Management Centre in an operational state. Even though Main Building with a greater capacity following demolition and rebuild could have generated potential rental income, MOD was reluctant to share the building with other tenants, as it had major security concerns over a mixed occupancy development. MOD's preferred option was to redevelop Main Building.
2.7 In June 1995, MOD decided that the scope for a PFI solution should be explored. Coopers & Lybrand3 subsequently assessed, on MOD's behalf, market interest in undertaking a project to meet MOD's objectives for Main Building under the PFI. The preferred option which Coopers & Lybrand discussed with the market was for the private sector to:
■ Redevelop Main Building;
■ Decant all occupants of Main Building into suitable accommodation during the redevelopment; and
■ Provide facilities management for Main Building once redeveloped covering all appropriate supporting services.
2.8 In investigating the market for such a deal, the advisers also tested interest in a minimum option, involving refurbishment and operation of Main Building's building systems without redevelopment of the structure.
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3 Coopers & Lybrand is now part of PricewaterhouseCoopers.