BBC surrenders ownership of prime property in £775m revamp of its image

The BBC has embarked on a £775m architectural odyssey designed to slash operating costs and consign its often grotty working environments to history, in the process making the corporation one of Britain's main property developers.

Its "sweetheart" deal with Land Securities Trillium, set out yesterday by John Smith, the BBC's finance director, means the corporation will get three big new building complexes in London and Glasgow, and swish new nerve centres in the heart of Birmingham and Norwich, at no cost. It will also retain 30-year leases and a 50 per cent stake in the freeholds.

A significant chunk of the company's 522 owned and leased property portfolio will be liquidated. Bush House, which houses the World Service, and 32 other buildings in London, will be among those lost in the reshuffle. Nationally, about £100m will be saved on leases and maintenance by 2008.

The showpiece project is the redevelopment of Broadcasting House in Portland Place, London, in a huge make-over that will cost at least £400m. Designed by Sir Richard MacCormac, it will retain the shell of the existing 1931 building and repeat its form as part of a large U-shaped building clasping an open piazza. An atrium will lighten the core of the building, which will contain 140 studios and, at half the size of a football pitch, the world's biggest newsroom.

The new Broadcasting House, due for completion in 2006, will undoubtedly be an improvement on the smoothly bland existing building – described by Britain's greatest architectural historian, Sir Nikolaus Pevsner, as "a blight on the whole delightful Georgian neighbourhood". It will also mean the removal of the cheapjack buildings behind it, and give the sublimely elegant All Souls Church in Langham Place a vastly improved setting.

"In the past, the BBC really cared about buildings," said Mr Smith, who acknowledged Capital Radio's lead in user-friendly buildings. By the 1970s and 1980s, "quality architecture dropped off the agenda. Cost consciousness became the dominant consideration. Buildings were built on the cheap. And even the loved buildings became unloved. The nadir was the White City building".

Unfortunately, that inscrutably ugly object, which was the subject of an embarrassing U-turn when staff were first moved in and then moved out, would cost too much to knock down. There are plans to fiddle with it, but it will remain in the Nicholas Van Hoogstraten category of grandiose architectural outrages.

But near it, on a 17-acre site, a new mixed-use urban quarter of BBC and commercial buildings, designed by Allies and Morrison, is already under way. The buildings may not be remarkable, but they will deliver hugely improved central office facilities. The White City Television Centre, an architectural lummox but still outstandingly functional, will remain as a production hub.

And in Glasgow, the architect David Chipperfield has come up with a new BBC headquarters at Pacific Quay whose calmly ordered, blockhouse exterior contains a series of potentially stunning indoor circulation areas.

The three capital building projects, as well as the new and highly "street-cred" operations within the Birmingham Mailbox and Norwich Forum developments, begins to set a new property benchmark for the BBC.

But will it make any difference to front-line troops hunkered down in notably grubby BBC outposts such as those in Oxford and Derby? Alan Yentob, the corporation's head of drama, admitted that the company's architectural confines had felt like "serving a prison sentence, and having been complicit in it. But this is about outside and inside, it's about public access. And art and architecture is integral in these buildings. Interactivity is part of the new era in broadcasting. It's changing before our very eyes."

But not completely. It is to be hoped that the BBC's new commitment to better buildings pans out in practice, and produces considerably more ripples than its autumn series, Britain's Best Buildings, whose star turns – Windsor Castle, Tower Bridge, Durham Cathedral and Blenheim Palace – are worthy but mired in the past.