The reputations of some of the biggest hitters in investment banking will hang in the balance this week when George Soros, Guy Hands and Goldman Sachs vie for one of the largest ever government Private Finance Initiative (PFI) projects.
The prize is to take charge of, and own, 750 properties that form the Inland Revenue and Customs & Excise estates on a contract estimated to be worth £2bn over 20 years.
Last night the three parties were dotting the "i"s and crossing the "t"s on their bids for the project, code named "Steps", in time for a Wednesday deadline.
One of the parties, which asked not to be named, said that its bidding document would include more than one million pages and cost nearly £10m to prepare. But it is not simply a matter of cost - reputations are at stake as well.
Mr Hands, head of Japanese investment bank Nomura's principal finance division, set up a unit, Servus, especially to bid for large PFI projects. So far a big deal has eluded it, so it needs to win Steps to help justify its existence.
American investment bank Goldman Sachs and one of its investment funds, Whitehall Street, own PFI company Trillium. In 1998 Trillium, run by accountant Manish Chande, won the contract to own and manage the DSS property estate, which is a similar size to Steps. Last year its handling of the estate was given a clean bill of health by the National Audit Office. A second PFI trophy in its cabinet would establish Trillium as the dominant player in the lucrative market.
Mr Soros's bid is through Mapeley, a consortium of investors. It includes the billionaire's Quantum Realty Fund, US investment bank Morgan Stanley and Fortress Investment Corporation, a US real estate fund. The parties have made noises about strengthening their position in the UK property market and getting one up on Trillium, so Steps would be a major coup.
It is understood that both Goldman Sachs and Nomura have employed political lobbyists to help get their message across to the Government.
As well as taking ownership of the estates, which total 16m sq ft of office space and include the architecturally acclaimed Inland Revenue complex in Nottingham, the winner will be responsible for managing services such as cleaning, catering and maintenance.
The Government is expected to choose the winning bidder in June and award the contract in the autumn.
As well as bidding for government PFI projects, the three parties are also hoping to transfer the model to blue chip companies and corporations.
As with a traditional PFI contract, a firm would transfer the ownership of its property to the third party, which would then manage the buildings and its services on a fixed contract.
This would effectively release the capital locked in the property. The company could then redeploy the cash in its core area of business.
While a deal like this has yet to happen in the UK, industry observers are convinced that the first of its kind will be signed in the next two years. When this happens, it is expected to lead to a flurry of copy-cat deals as industry standards are set.
Four UK-based companies are known to be looking at the model. They are:
* Abbey National, which is exploring ways of selling its entire £460m property portfolio, including 221b Baker Street, the fictional address of Sherlock Holmes. Mapeley, Trillium and Servus are understood to be talking to the bank.
* Lloyds TSB, which is considering outsourcing its portfolio of more than 3,000 properties - including 2,500 branches - estimated to be worth £1bn. Again, Mapeley, Trillium and Servus have held talks with the bank.
* JP Morgan, which is thought to be the closest to structuring a PFI-style deal on 11 UK properties. The investment bank has short-listed Mapeley and US investment bank Donaldson, Lufkin & Jenerette. If the bank is happy with the model, then it is expected to consider divesting its interests in other properties worldwide.
* ICL, the computer company, which is searching for a partner to outsource its £1bn property portfolio on a 10-year contract.
Meanwhile, the BBC is also in talks with Mapeley, Trillium and Servus about tendering a PFI-style deal to divest parts of its £430m portfolio.