The government has today confirmed plans to introduce two property vehicles to own and manage its office estate, one in central London and one in Bristol.
As revealed by Property Week last week, the government wants to explore ways of better asset managing its offices in order to find savings.
It plans to set up two pilot property vehicles from April 2011 before using the same model elsewhere in the country if it is effective.
In the Comprehensive Spending Review 2010, published today, chancellor George Osborne (pictured) announced that the Government Property Unit, led by John McCready, would help it to make “substantial gains” by co-ordinating property asset management across central government departments.
These departments will be asked to act as “clients” of the vehicle and ordered to pay “market rent” back to the Property Unit.
It is understood that the Property Unit will now look for one or more private sector partners to help it manage the estate and deliver savings.
Last week, Property Week wrote that the vehicles would be property’s key contribution to the savings announced in today’s Spending Review.
Introducing it this afternoon, chancellor George Osborne said potential savings on administrative costs, including property, were double the expected level of £3bn.
The review also includes a new system of National Property Controls, revealed by Property Week two weeks ago. The system imposes a moratorium on government leases and demands that departments and quangos make a watertight business case for the signing of leases or renewals.