INDUSTRY NEWS

Crunch hits Olympics budget

The credit crunch is affecting London’s Olympics budget, which has again increased, a new report has found.

Research by the co-owner of Carphone Warehouse, David Ross, for the Mayor of London’s office has revealed a number of financial problems.

"The illiquidity of the banking system and falling house prices have had serious implications for the original arrangements between the Olympic Delivery Authority and Lend Lease, the developer of the Olympic Village Project," he said.

Mr Ross concluded recent economic changes will add significant problems to the Olympic project and affect sale values, availability of private finance and "tenant demand for space in legacy developments".

The Games’ huge costs are expected to be reclaimed, in part, by the creation of commercial property and residential sales after it has ended.

London Mayor, Boris Johnson, welcomed the report and reassured Londoners they "not pay a penny more council tax to pay for the Games – no matter the circumstances".

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