Maybe we could say it this way. We definitely considered whether the government's cost of capital, as defined by the government's cost of debt, is an appropriate benchmark to look at as a source of financing. Whether it's this client or other ones, I think it's very important to consider what your real cost of capital is. I think when you take a look at a situation like this, you have an apparent cost, being your cost of debt, which is lower than anybody else's. However, the gap between where the government's cost of capital is and everybody else's certainly has compressed, so there's not that much difference any more.
But let's grant that you have the lowest cost. If you lop on top of that the real estate risk that you are assuming by continuing to own--and by that I mean residual risk--as you continue to own these and don't maintain them well, their value does not appreciate the same way as a private sector building does. As your deferred capital that we've all heard about builds up, your value is going down. So when you go to sell that building way down the road, maybe it's occupied, maybe it's not. Let's say you're selling an empty, poorly maintained building. Its value is quite low. So that's residual risk.
You have the preventative maintenance deficiencies that we've talked about already. You have the forgone market opportunities, which might be realizing additional density, putting different tenants in on the ground floor, or using excess space. This is what Keith was talking about earlier: the asset management versus just plain property management.
If you combine those risks with forgone opportunities, with the massive cost of delivering the service versus the private sector, in terms of the infrastructure that the government needs to process and make decisions, the real cost to capital of owning these buildings, I would respectfully say, is probably a lot higher than people in this room may think it is, if you think it's only the cost of debt.
