The Olympic Delivery Authority has said the problem of securing funding for the £1.2bn Olympic village has been exacerbated by the turmoil in the financial markets over the past week, write Sarah Richardson and Dan Stewart.

John Armitt, the chairman of the ODA, said: “There was a certain amount of finance available six months ago, less two months ago and there was probably even less last week. Getting any form of loan from the private sector at the moment is very difficult.”

The ODA last month struck an interim deal with Lend Lease on the village, enabling the firm to act as contractor without an equity stake for an interim period until a final funding agreement can be reached, which would see Lend Lease part-fund the project.

However, the tightening of the financial markets and reluctance to lend, particularly to the housing sector, has thrown doubt over Lend Lease’s ability to finance the scheme.

Armitt, who was speaking to Building at a fringe event at the Labour conference, said the ODA was still forecasting a deal “around the end of the year”.

He said the ODA believed it had secured “more than half” of the necessary funding for the project.

The news came as the Olympic minister Tessa Jowell ruled out the possibility of the government underwriting the athletes’ village instead of Lend Lease.

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