Public funds needed to rescue the London Olympic Village

Published: 2009-05-26 10:36:07

The Olympic athletes’ village in Stratford, costing up to £1.1 billion, had been planned to be at least 50% privately funded, but the government has now had effectively to nationalise the project after the Olympic Delivery Authority’s (ODA’s) development partner Lend Lease struggled to raise funds.

 

Tessa Jowell, the minister responsible for the ODA, claimed that public funding will be eventually reimbursed by the conversion of the village into up to 2,800 flats and the ODA estimated the sale should earn at least £500 million by the end of 2013.

 

However, the proposed conversion will include shared ownership properties and social housing that is being partly paid for by a £100 million grant from the HCA, which of course is using public money. The new funding arrangements for the village also involve a £168 million loan arranged by the European Investment Bank. The funding bail-out may ensure the Olympic Village is built in time for the games, but the prospect for recouping the total cost to the public purse now looks much more uncertain.

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