The United Kingdom once again delayed its decision last week on whether to green light China's push for a new, massive embassy in the heart of London. It would not only be the largest Chinese embassy in Europe, but also one of the largest in the world. 

Beijing's hope, however, still hangs in frustrated limbo after three decision delays, six major anti-embassy protests and Prime Minister Keir Starmer last week calling China "a country that poses real national security threats to the United Kingdom." His defense minister further cited "complexities of the national security implications." 

Critics fear the so-called "super embassy" could serve as a super hub for intelligence gathering – physically and technologically, impacting not just the United Kingdom, but also the continent. 

"There are important fiber optic cables that either run under the site or very close to the site, which carry probably massive amounts of important and valuable data," said Sir Richard Dearlove, former chief of Britain's MI6, the U.K.'s foreign intelligence agency.

Dearlove has called on the U.K. government to reject China's embassy ambitions, with cables possibly transmitting sensitive financial and commercial data across London. 

"Having a Chinese embassy sitting on top of those cables, which could in extremis be attacked, is a significant problem," he added. 

With a larger physical presence, Beijing could also employ more Chinese diplomatic staff, who would have freedom of movement allowed by their visas.

"If it's got a very large embassy, there could be a very large number, and then going off to third countries, ostensibly on holiday or whatever, or to travel, and doing stuff outside the country to which they're accredited," said Dearlove. 

"They're purporting to be ordinary diplomats, ordinary attaches, who are actually highly trained intelligence personnel," he said.

Beijing might also more easily target communications from the defense and foreign ministries using facilities based within a bigger embassy, said Nigel Inkster, former MI6 director of operations and intelligence and now senior adviser for cyber security and China at the Institute for International and Strategic Studies. 

"Not all systems, not all government systems use the internet," Inkster said. "Most sensitive information is air-gapped. In other words, it goes on systems that do not have any connection to the public internet, and therefore, if you're going to try and access them, you are going to have to get closer to where they are actually being generated."

"Would China like to get ahold of such data?" he added. "Yes, because China's appetite to acquire data on other countries is limitless. They're completely promiscuous about what overseas data they collect." 

Site of proposed embassy is in heart of London

British pushback also stems from history and pride. The site of China's would-be embassy overlooks the iconic Tower of London and The Shard. It is the former home of the Royal Mint, which engraved coins with the monarch's face as a physical manifestation of the crown's authority. 

In 2018, the government sold the grounds to Beijing for nearly $350 million, setting up the more than five-acre site to become a physical fortress of Chinese state power in the West. 

"One of the reasons I object — maybe the main reason — is the symbolism of allowing the Chinese communist government such a prominent position on the edge of the city in such a prominent building," said Dearlove. "It sends entirely the wrong signals."

Taking up an entire city block and spanning five acres, architectural renderings indicate China's new embassy would dwarf its embassy in Washington, D.C. by about three times and its current embassy in London by about 10 times. It took our CBS News team more than nine minutes to walk the perimeter. 

Schematics show plans for a cultural center and more than 200 apartments for embassy staff – not a common feature of Western governments' embassies but employed by some authoritarian governments including Russia, North Korea and Cuba to keep employees close at hand. 

CBS News got a first-hand look at the future embassy residences – buildings that sit on the site that is owned by the Chinese government. They are currently empty. 

Mark Nygate, a 28-year resident just next door in the London borough of Tower Hamlets, gave CBS News a tour of his building and the inner parking lot that abuts the Royal Mint grounds. A simple, low wooden fence separates the two.

"I call it the little wooden fence of China," he said jokingly. 

He and his neighbors fear that the Chinese government will eventually push them out. 

"The idea is that at some point they will want to make this a harder border for them, make their staff more secure," he said. "They could try and buy us out."

Fear from China's exiles and dissidents 

Thousands of anti-embassy protestors, Chinese dissidents and exiles marched through central London this past weekend, newly galvanized after Starmer's most recent decision delay. Many held large flags showing support for Hong Kong, Taiwan and Tibet. 

"I was under the impression that the U.K. government was ready to sell us out," said Tenzin Ragba, the campaign lead for Free Tibet, a nonprofit that calls for an end to what the group describes as China's occupation of Tibet and dilution of Tibetan culture since the 1950s. 

"China is a systemic rival for democracy," said Carmen Lau, a former Hong Kong pro-democracy politician now living in exile in the U.K. "You wouldn't just simply open the door for an autocracy or an authoritarian regime to have a base in the heart of your capital." 

Since she fled Hong Kong after the failed pro-democracy protests of 2019, Beijing has been watching Lau in London, she says, looking to detain anti-China voices abroad. 

"I've been followed, on the streets of London," she said. "They don't deploy Chinese or Asian faces people to follow us - rather they would just deploy someone random in the community." 

Lau said her neighbors also received a "wanted" letter, calling on them to turn her in to the Chinese embassy, for a reward equivalent to about $125,000. 

"I was so afraid to talk to them after these incidents happened. Because, you know, who knows who really will be tempted by the rewards," she said. 

Several other former Hong Kong pro-democracy leaders have similar bounties on their heads. The U.K. has become home to the world's largest Hong Kong diaspora community with an estimated nearly 200,000 having fled in the past five years. 

London wants a new embassy, too 

The U.K. government delayed its final decision on China's embassy proposal to Jan. 20. 

Prime Minister Starmer has proposed a trip to Beijing just nine days later. That would mark the first time a British premier visits China since 2018, before the COVID-19 pandemic.

The government is hoping China will approve its own plan for a new embassy in Beijing. 

Starmer's visit may depend on whether Beijing gets what it wants first in London.