In a move that could end critics’ concerns about the potential value of the scheme, the department has released the findings of a report compiled by property consultants DTZ.
The major building project – which aims to create a six-office finance centre and underground parking on what is currently the Esplanade car park – has faced sustained criticism from rival developers, sceptical backbenchers and environmental lobby groups since plans emerged several years ago.
It is also the subject of a detailed review by the Corporate Services Scrutiny Panel, which is expected to reveal its findings later this year.
Deputy John Le Fondré, the chairman of the CSSP, said he had asked for a copy of the DTZ report to be given to the panel, but that he had not seen the document yet.
‘I am curious as to how the reported return is arrived at, given that it is double the amount reported earlier this year by the JDC,’ Deputy Le Fondré added.
The publication of DTZ’s report follows criticism about the level of contamination at the site, which was found to be higher than expected this summer, leading project opponents to claim that the money required to deal with the issue would eat into the finance centre’s profits.
However, according to the Treasury Department, it is estimated that the completed project will provide around £95 million to the States – around twice the amount previously predicted.
Information released by the department yesterday said that there was an estimated £237 million build-cost for the scheme, which included the cost of dealing with contaminated ground, and an estimated overall value of £332 million for the finished finance centre once it is fully let and the buildings are eventually sold.
6 – The number of office blocks proposed for the site
200,000 – The amount of office space in square feet former Treasury Minister Philip Ozouf said would have to be pre-let before work could begin. Senator Maclean said this was a mistake
13 – The number of prospective tenants supposedly in talks to move into the development
16,000 – The square footage to be taken by Swiss bank UBS, with the option of a further 7,000 sq ft
1,200 – The number of people who have signed a petition to halt the development
Treasury Minister Alan Maclean said that the information had been released following concerns about contamination costs and their impact on the project’s viability.
He said: ‘I thought it as important some months ago to ask for an up-to-date valuation.
‘I wouldn’t necessarily have published it, but it’s helpful because there’s been a lot of commentary around contamination issues, with some asking if that called into question the viability of the project as a whole.
‘The report clearly demonstrates that at this stage the project is still very much viable and I’m pleased to see that.’
Work continues on the first building of the scheme, a 67,000 sq ft unit in which Swiss banking firm UBS has agreed to lease around one quarter of the office space and Senator Maclean said he hoped that further tenancy deals would be agreed before the end of the year.
And according to the report that building could yield a return of £42.8 million after it is fully leased and later sold.
However, a formal appeal was lodged against the second finance centre building after plans were passed earlier this year.
Parties involved in the appeal have provided detailed reasons for their objections and an independent inspector is due to be appointed to review the objections.
When asked what would happen if the CSSP’s review concluded that there would be significantly different financial returns, Senator Maclean said the basis of that valuation and its findings would have to be looked at.
He added: ‘The key here is that the expected receipts significantly exceed the original JDC estimates.
‘That valuation done by the JDC demonstrated that the development was viable.
‘What’s important here is to have an up-to-date valuation and I’m pleased to see that it again demonstrates the scheme is viable.’
Senator Maclean, who called DTZ a ‘renowned firm of property consultants’ also said that the office buildings and 520-space underground car park represented the first phase of the wider Esplanade Quarter Masterplan, which he said needed ‘to be flexible’ to ‘evolve and respond to changing circumstances’.
A redacted version of the DTZ report, which is said to contain commercially sensitive information, is expected to be released later this year.
Back in June around 2,000 Islanders protested against the International Finance Centre by creating a ring of defiance around the car park.
