The cabinet has approved a Finance Ministry proposal to allow Dhanarak Asset Development Co, a state enterprise under the Treasury Department, to develop Zone C at the Chaeng Watthana Government Complex, worth 30 billion baht.
Puttipong Punnakanta, deputy secretary-general to the premier, said on Monday Zone C, which spans 81 rai, will be developed into office buildings for government agencies over 660,000 square metres.
Dhanarak Asset Development last year signed a 20-year rental contract for a convention centre and hotel at the Chaeng Watthana Government Complex to Centara Hotels and Resorts. Part of the proceeds have been used to finance design expenses for Zone C.
Mr Puttipong said the development is necessary, as Zone A and B office buildings are fully occupied, and there is demand among state agencies.
The cabinet yesterday also assigned the Finance Ministry to on the responsibility of raising funds to finance the project.
The ministry is also required to propose to the cabinet the most appropriate fundraising method, while Dhanarak Asset is required to hire a consultant to design the office building with innovative features.
The construction is scheduled to start in late 2019 and be completed by 2022.
The cabinet also approved the Treasury Department to tie over the budget for construction and raise funds from borrowing.
Dhanarak Asset Development is 99.99% held by the Finance Ministry through the Treasury Department. It is responsible for investing in building the Government Complex and managing the property of the state agencies.
The company has registered capital worth 258.33 million baht.
Mr Puttipong said Prime Minister Prayut Chan-o-cha mandated the ministry should consider the most appropriate methods to raise funds, taking into account the government's coffers each fiscal year.
Gen Prayut also assigned related agencies to study the impact of traffic and its effect on people living in the areas.
The Finance Ministry reported that traffic congestion in the areas is expected to ease as the Red Line and the Pink Line mass transit networks are scheduled to commence in 2020 and 2021, respectively.