I think it is smart, remember the land (20,000 m2 for GBP225M in 2018) that China bought and become an embassy in Royal Mint Court, bordering City of London. That land is strategic location and because will be a new China's mega embassy, technically is under China jurisdiction, kind of. No business rates and council tax on that land and building/embassy
Interesting how much to build that mega embassy and who will build it, I'd imagine MI5/6, CIA/NSA, etc would try hard to put something there (just like any other country). I am 100% confident MSS would do the job just fine to scan and inspect everything
Remember when Jiang ordered a new president air force one to Boeing (in 2000 or 2001) and there were full of sophisticated listening devices found inside the aircraft
The City of London (the "Square Mile") operates very differently from the rest of the country. The King need "permission" ceremony to enter it, very odd