London’s Olympic chiefs yesterday warned that contributions from the private sector to the costs of two of the biggest 2012 projects were likely to be much smaller than originally expected as a result of the credit crunch.

The Olympic Delivery Authority, which oversees the London 2012 venues, said the economic conditions were undermining the development partners’ ability to borrow sums on favourable terms.

The upshot is that the ODA will have to draw on the £2bn of contingency funds made available within the overall budget of £9.3bn.

Lend Lease, the Australian developer of the £1bn athletes’ village, has already talked about its difficulties in raising money to fund half the cost of the 3,000-room complex, leaving the ODA with a shortfall understood to be about £250m.

Financial Times