A bid by Chelsea College of Art and Design to move to Millbank, next to the Tate Gallery, has received a big boost with the gallery's trustees throwing their weight behind the plan.
The site, the Royal Army Medical College, is owned by the Ministry of Defence, which is looking to sell the listed building. Westminster Council is keen for the building to be used for educational purposes.
Both the MoD and the council have yet to decide which of several bids they will accept for the building, thought to be valued at between Pounds 25 and Pounds 30 million. A decision is expected within the next few months.
Sir William Stubbs, rector of the London Institute, of which Chelsea is a part, declined to comment on the price but he did say that the backing of the Tate was "hugely welcomed and encouraging".
He added: "The institute is just one of a number of bidders, but we do believe that plans to develop the site for a mixture of public and educational uses, together with collaborations with the Tate, would benefit London."
He said many local Millbank residents had also indicated support for the institute's plans.
The London Institute is prepared to offer cash for the site and it needs no grant. Sir William fears private bidders may be able to promise more money, but he pointed out that this may be dependent on their securing revenue from any commercial development.
If the property is signed over to Chelsea by the end of this year, the college estimates a two-year redevelopment programme will allow the whole college to move there in 2003. It is currently spread across four sites.
Sandy Nairne, the Tate's director of national programmes, said: "This fits with the development brief set by the city of Westminster and will complement the work being undertaken to expand the galleries and facilities of Tate Britain." CORBIS