ODA grabs £50m site to pay off overspend

The ODA is on the brink of signing a deal with London and Continental Railways (LCR) to take the freehold of the approximately 10-acre site between Stratford International station and the 2,800-home athletes’ village.

A senior government source close to the deal said the move was designed to allow the ODA to generate the maximum land receipts by selling to developers after the Games, in order to return as much of the £2.75bn contingency fund as possible to the Treasury.

Previously, the ODA had overage agreements (allowing it to claim payment if and when planning permission is granted) and a veto on development plans for the land owned by LCR north and south of the station. The new deal, agreed in principle in the last few weeks, will swap these interests for ownership of the northern site.

Building understands this has freed LCR to go forward with a 50-50 joint venture with Lend Lease on the land to the south, where it plans to build 1 million ft2 of office space, 1,500 homes and 400,000ft2 of shops.

The deal, set to be finalised early next week, will leave Bovis in pole position for construction work from parent Lend Lease.

Lend Lease was originally supposed to be the developer of the athletes’ village, but ended up in a contracting role.

The plan to hand the northern site to the ODA is controversial. The Olympic Park Legacy Company, the body in charge of the post-Games development, is thought to be concerned by the prospect of the proceeds going to the Treasury rather than into regeneration. The government source said: “The ODA has traded the long-term position for more immediate gain.”

The move also comes despite a Treasury decision last month to pass land owned by the London Development Agency to the legacy company for regeneration.

The ODA declined to comment.

A spokesperson for LCR confirmed it planned to enter into a binding framework agreement with Lend Lease to create a joint venture, but declined to comment on the deal with the ODA.