Contractor expected to hike price from the £280m given in London’s original bid

Sir Robert McAlpine is expected to submit a price of up to £400m for the London Olympic stadium. This compares with a figure given in the original Olympic bid documents of £280m.

Building understands that McAlpine’s overall bid may reach £600m. This encompasses the infrastructure works surrounding the building, including roads and a bridge.

The Olympic Delivery Authority (ODA) will undertake months of value engineering on the stadium design before work begins on site.

A source close to the negotiation said the ODA had seen the drawings and designs for the stadium and was nearly ready to go public with them.

He said: “McAlpine’s bid for the stadium is less than £400m but it has to be taken as a whole, as the tender includes the full package of works for the area. The next round of price negotiations will be critical.”

The ODA is expected to release its final stadium budget next month.

It is understood that David McAlpine is to stay on as Sir Robert McAlpine chairman to see through the stadium negotiations and get the project to site.

A source close to McAlpine insisted that Benny Kelly, the company’s construction director and the man behind Arsenal’s Emirates stadium, would remain should negotiations be successful, despite speculation that he may step down or retire.

Negotiations between McAlpine and the ODA have been of particular interest as the ODA does not have rival tenders to fall back on. Under the authority’s design-and-build procurement process some teams were disqualified as they did not contain a contractor.

Contractors, such as Bovis Lend Lease, Skanska, Taylor Woodrow and Kier, did not submit bids because they viewed the project as too risky or were vying for the Olympic delivery partner role.

An ODA spokesperson said: “We have already stated that we will not comment on speculation over figures ahead of our discussions and negotiations. We continue to talk to Team McAlpine about both the costs and the design of the Olympic stadium and will be announcing more detail in the coming months.”

Sir Robert McAlpine was unavailable for comment.

Team McAlpine also includes consulting engineer Buro Happold and architect HOK Sport.