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Market meltdown hindering funding for London 2012

Sept. 25, 2008, 1:09 p.m. (ET)

LONDON(AP) Global financial turmoil is hindering efforts by London 2012 organizers to raise money for key Olympic construction projects.

That could lead to greater public financing of the Olympic Village and broadcast and press center by using the British government's contingency of $1.9 billion, an official said.

``We originally expected to have quite big sums of private sector funding for the Olympic Village and for the media center,'' said John Armitt, chairman of the Olympic Development Authority. ``The consequence of what is happening in the markets means that the availability of funding is more difficult.''

The ODA had hoped to raise $900 million from the private sector for the $2-billion Olympic Village, which has been scaled back to 3,300 apartments for the 17,000 athletes and coaches.

The ODA is in talks with banks, a construction consortium and Lend Lease, the Australian contractor for the Olympic Village.

``There will be an element of contingency funding required,'' said Armitt, who insisted the overall project is on schedule and within the $17-billion budget.

The athletes' village is the largest component of the 500-acre Olympic Park in east London. Construction started in June.