August 2011 Archives

Six months and 13 days after West Ham United were chosen as preferred bidder for the Olympic Stadium, Tottenham Hotspur have been granted the chance for a legal challenge of the decision.

Spurs have refused to lie down over the fact the Olympic Park Legacy Company picked West Ham to be the future occupier of the £486m venue.

Their argument revolves around a £40m Newham council loan to West Ham in order to make the Hammers' bid stack up.

West Ham currently have around £100m of debt and Spurs claim that Newham's loan constitutes illegal state aid - under EU law public money is not allowed to confer a competitive advantage on private companies.

Crucially Mr Justice Collins today ruled that Spurs' case is arguable.

But it is important to note that isn't the same as saying Spurs are correct, only that there are grounds for a legal challenge to be heard.

Newham council and the OPLC will now have to gather their case together for a judicial review to be heard in October.

All the while the dotted line at the bottom of the contract between West Ham, Newham and the OPLC remains unsigned.

The longer Spurs continue to contest the decision, the longer that dotted line will remain blank...

It's a big week for the Olympic Park Legacy Company in terms of probes into the awarding of the Olympic Stadium to West Ham United.

The OPLC came through the first test today after the forensic unit at independent auditors Moore Stephens completed its inquiry into OPLC director Dionne Knight also being on the payroll of West Ham.

Moore Stephens report reached the following conclusions:

• There is no evidence to suggest that this employee had access to confidential information relating to the stadium process

• There is no evidence to suggest that she passed confidential information in relation to the stadium process to West Ham United FC or any other third party

• There is no evidence to suggest that she influenced the stadium preferred bidder selection process.

But the second, and more high profile probe, begins on Wednesday at the High Court when Tottenham Hotspur will present evidence at an oral hearing to push for a judicial review.

Undoubtedly the Moore Stephens finding will be a blow to Spurs' bid and by the end of this week, the OPLC will be hoping to press ahead and finalise details of the deal it wants to sign with West Ham and Newham council.

The Olympic Delivery Authority took one step closer to being wound-up early today in a deal that makes the responsibility of future development in the Olympic Park a whole lot clearer.

There will now be just one public body responsible for work at the Olympic Park post the Summer of 2012 - the Olympic Park Legacy Company.

It is, of course, a long awaited deal that has taken place, but its timing means the ODA can conclude its contracts and then wind itself up early if needs be.

The OPLC will take on more than £300m of scope and budget from the Olympic Delivery Authority, which has also seconded its transformation team across.

The OPLC will now oversee the process of transforming the Olympic venues and infrastructure, including the removal of temporary venues and structures and reconfiguration of roads, bridges and other infrastructure post-Games.

One of the ODA's last major legacy tasks completed on Friday when its £557m deal to sell the private housing element of the athletes' village to Delancey and Qatari Diar was announced.

The writing was always going to be on the wall for the ODA, but it is interesting to see there has been no hanging around.

It has to make good sense, not least be value for money and efficient to have just the one body in charge at the Olympic Park.

The sale of the private housing element of the London 2012 athletes' village to a joint venture between Qatari Diar and Delancey has at last been completed after it was put up for sale in October 2010.

The Olympic Delivery Authority has banked £557m from the deal to go alongside the £268m it got for the 1,379 affordable homes in June 2009 from Triathlon Homes.

So does £825m represent a good price?

The ODA's latest annual report shows the development cost of the athletes' village as of March 2011 stands at just under £1.1bn.

The ODA will also be responsible for refitting the 2,800 homes post-Games before handing over to both Triathlon and Qatari Diar/Delancey in 2013. None of the homes currently include a kitchen because the athletes will eat at a purpose-built dining hall.

The ODA's budget for delivering the village stood at £458m at March 2011 so alongside the £825m recouped from the sales that's a total of just under £1.3bn.

Therefore there is still a potential £200m in the kitty to pay for the conversions without having to dip further into public coffers.

And then it is expedient to look at what else is being delivered as part of the cost.

There is the Chobham Academy school and a new health centre, as well as roads, parks and infrastructure around the village.

All that together will help create a new community, potentially home to 5,000 to 10,000 people.

Undoubtedly the public will remain out of pocket, but what price should be put on such regeneration...

Hamptons International has put together a report detailing the gold, silver and bronze medal winning opportunities to make money from property during the Olympics.

The report says more than one million visitors will descend on London for the 2012 Olympic Games including spectators, competitors, officials and sponsors.

BRONZE

Third on the podium goes to homeowners looking to sell in the Olympic locations away from the Queen Elizabeth Olympic Park - the likes of Weymouth, Windsor & Eton and Hadley Farm in Essex.

These places will all be in their 'Sunday Best' during the Games and could take advantage of the feel good factor to attract passing potential buyers.

Windsor & Eton for instance is expecting to host 30,000 visitors a day during the Olympic rowing competition - a high level of footfall to be passing a for sale sign...

SILVER

The runner-up spot in Hamptons' eyes goes to large-scale residential development investment opportunities.

The report says that tens of thousands of new homes will be built in the East of London in the coming years, 11,000 of which will be within the 500-acre Olympic Park.

This new housing supply creates opportunities, but also a high degree of potential risk for investors. Selecting the right development will be crucial for profitable investment off the back of the Olympics.

GOLD

And the top prize goes to those looking to put their home on the market for a short-term letting.

Hamptons says visitors will be looking to stay from as short as one week up to six months.

For prospective landlords Hamptons says a typical short let tenant so far as an average budget of £1,225 per week to spend, with a range from £160 to £40,000 and is seeking two bedrooms and two bathrooms with 96% looking for furnished accommodation.

Some requirements it has picked up on include:

* A French media advisor, seeking space for six to eight weeks as close as possible to Stratford for up to 15 staff;
* A concierge service business that requires up to eight one-bedroom apartments in Victoria for staff to be able to quickly support clients in local hotels for the duration of the Games; and
* A news agency that requires space for up to 20 staff in or around the City Fringe with easy access to Liverpool Street Station.

Sounds pretty encouraging...

And such is Hamptons confidence in its gold-medal prediction, it has started a dedicated short-let matching service between tenancy requirements and opportunistic landlords.

I have done a little more investigation around the chosen names for the five new Olympic Park neighbourhoods after an interesting response to my last blog from whyperion - thanks for that.

Chobham Manor is so named because of a manor house that existed in the area from 1329 to 1882. It originally belonged to a John de Preston who then sold it to a John de Chobham in 1343, hence where it got its name. It was demolished in the late 1800s to make way for the expanding Stratford rail yard.

Eastwick pays homage to the importance of Hackney Wick as an area of the East End with a rich and well-documented history of invention and industry. Among its notable historical tenants was Alexander Parkes who is credited with the manufacture of the first man-made plastic in the world, known as Parkesine - in 1856. He built his Wallis Rd factory in 1866, but his attempt at bulk low-cost manufacture of Parkesine was beset by many manufacturing problems, and the business closed just two years later. (This obviously goes someway to explaining what appeared to be one of the more obscure suggestions in the neighbourhood naming competition - Plastic Fantastic).

Sweetwater is so named because of the association of confectionary and jam-making in the general area including the old Clarnico factory, established in 1872 as Clarke, Nicholson & Coombs confectioners, reportedly the largest confectioner in the UK in the late 1940s.

Marshgate Wharf's name comes from the several usages of marsh in the area traditionally applied as a result of the River Lea floodplain further to the South. There is Stratford Marsh, Hackney Marsh and Leyton Marsh.

Pudding Mill is named after the Pudding Mill River which has been named as such on the earliest post-medieval mapping onwards. It is very probable that the name refers to flour milling, although all manner of other milling undoubtedly occurred along the banks of the Pudding Mill River throughout the medieval and particularly industrial periods.

Meanwhile, any suggestion that the Olympic Park will be sold to a single operator appears to have been scrapped after the Wellcome Trust's £1bn offer was rejected.

This has to make sense as the Olympic Park Legacy Company will surely be able to generate better value for the public purse by playing a long game and finding the best possible uses for each asset within the park one by one.

And finally, chemical company Dow is to fund and make a 336 panel fabric wrap around the Olympic Stadium on which it will be allowed to advertise on until a month before the Games open on 27 July 2012.

The wrap was conceived by the architects as the finishing touch to the stadium but was dropped to save £7m from the construction costs.

It's good to see the Olympic Stadium is going to get its special outfit after all in time for the big day!

The names of the five new neighbourhoods at the Queen Elizabeth Olympic Park have been revealed.

The new suburbs which will contain around 8,000 new homes are to be called Chobham Manor, Eastwick, Marshgate Wharf, Sweetwater and Pudding Mill.

Nearly 2,000 suggestions for the neighbourhoods were made to the Olympic Park Legacy Company in a competition earlier this year.

The suggestions had ranged from the likes of those chosen to the less serious Plastic Fantastic, Redgravia and Little Athens.

The winners were judged by a panel including representatives from Newham, Tower Hamlets, Hackney and Waltham Forest councils and the Museum of London.

The homes will include modern versions of London's traditional Georgian and Victorian squares and terraces, as well as riverside properties.

Up to 35% of them will be affordable housing, in-line with the Mayor of London's plan.

The park will open in phases to the public from 2013, with families moving into the first new homes in 2015.