The Kremlyovsky hotel and shopping complex, as it will be called, will be located in the historical building of the Middle Trade Rows, built at the end of the 19th century. The complex currently belongs to the president's office. Its four houses are surrounded by the main building, which is a historical monument of national importance.

The complex will accommodate a luxury hotel, a Russian auction house and apartments located in one of the inner buildings as well as two-level underground parking, a shopping area, restaurants and a spa center. A major international hotel network will manage the hotel and the results of the tender are due to be published soon.

Although the developers insist they will abide by the law and leave the facade of the merchants' building unchanged, they plan to conduct serious construction work behind and beneath its walls less than 300 ft from St. Basil's Cathedral, one of Russia's most distinctive architectural landmarks.

Andrei Batalov, head of the cathedral's restoration commission, has warned that cracks could open up in its walls as a result and has said that vibrations from pile drivers will be bad for the structure, which has been perched on an artificial hill for almost 500 years.

He wants the hotel project cancelled or at least subjected to proper public scrutiny. "We're talking about an outstanding symbol of the originality of all Russian culture," he is reported as telling the daily newspaper Izvestia. "We should stop regarding Red Square like an allotment at our country house. We should think of future generations."

The cathedral's foundations were laid in 1555 on the orders of Tsar Ivan the Terrible to celebrate one of his military victories. St. Basil's has survived the orders of Napoleon Bonaparte and, later Josef Stalin's campaign, to destroy Russia's churches.

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