Story highlights GSA initially requested $1.4 billion for the project

Only $523 million was appropriated, leaving "an $882 million funding gap"

(CNN) The General Services Administration and the FBI have decided to scrap Obama-era plans to construct a new FBI headquarters building because of funding gaps, according to a GSA statement Tuesday.

Although GSA initially asked Congress for $1.4 billion to fund the project in the 2017 fiscal year, only $523 million was appropriated, leaving "an $882 million funding gap," the statement said.

The funding gap rendered it far riskier to pursue the project, the statement said, because it could make the government vulnerable to cost escalations. Moreover, it would potentially reduce the value of the FBI's current property, the J. Edgar Hoover building in Washington, which GSA planned to trade in to a developer for additional funding.

But there's still hope for the relocation project.

"The cancellation of the project does not lessen the need for a new FBI headquarters. GSA and FBI will continue to work together to address the space requirements of the FBI," the statement said.

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