Bid ambassador warns that Olympics could divert funds away from other projects.
The viability of the Thames Gateway regeneration programme has been called into question following London’s Olympic success, according to one of the bid’s key ambassadors.
Barbara Goldsmith, whose Stratford Properties firm has reported a huge growth of demand in Stratford since London’s victory, said the need to give the Games top government priority could mean that funds were diverted away from other regeneration projects.
She said: “There’s no question about this. All eyes are on London and the money has to go there first. The government is overspending, and other projects could end up not coming to fruition. You can see it happening already.
“The writing’s on the wall for those who are ready to see it. Many projects will run into difficulties because the only 100% definite will be east London. I wouldn’t even bank on the Thames Gateway, at least not to the magnitude that John Prescott envisages.”
The government has committed £2.4bn to spend on facilities for the 2012 Games, but regeneration and property professionals are worried that the scale and scope of the Olympic build programme could lead to overruns that would have to be paid for by government.
Goldsmith said: “Projects of this scale always overrun and cost more because the cost of labour and materials goes up.”
Another regeneration professional said that the effect of the Olympic decision could have serious consequences for schemes around the UK.
The source said: “The immense costs of London’s hosting the Olympics will inevitably cause government spending to be withdrawn from other regeneration areas in the UK. Properties that are relying on government-funded regeneration schemes to increase their value are likely to see these schemes failing to complete as resources are diverted to the Olympic areas.”
The warnings came as London mayor Ken Livingstone said he wanted more than 31,500 homes built in the capital every year – an increase of 8500 on previous targets.
The demands were based on a recent London housing capacity study, which assessed the housing potential of 4464 sites, each larger than 0.5 ha, across the capital’s 32 boroughs.
Livingstone said: “Without a dramatic increase in the supply of new homes we face a future where overcrowding gets worse and worse; where high housing costs keep thousands in the housing benefit trap and where more and more Londoners are simply priced out of the housing market.”
