Robert Bartlett, Chestertons' CEO and a former rower who represented team GB in the 1992 Barcelona Olympics, takes a look at how the previous two European cities to stage the games fared afterwards.
The 1992 Barcelona Olympics were extremely successful and rejuvenated the city, its population and economy. It is estimated that the Games raised $16.6bn in total revenues for Barcelona between 1986 and 1993 and triggered a regeneration that is still being enjoyed by the city's three million plus population. It's effect on house prices was clear too – during the five years after the Games between 1993 and 1998 the city's house prices rose by 16.5%.
The Athens Games left a trail of debt and deterioration. The final costs, believed to be over £8.4bn, represented a budget overspend of around 100%. More seriously the event left numerous unused and deteriorating sporting venues and a general feeling of disappointment. And it did nothing for the city's property market. During the five years after the Games (from 2007 to 2011) house prices fell by 5.5%.
What about London's Olympics?
The London games have focussed on regeneration plans in five London boroughs with a total population of 1.15million people. LOCOG set out to maximise the legacy of the Games for London by focusing investment on projects with long term benefits. The development of infrastructure and services for the Games will ultimately service the residential and commercial development in the Lower Lea Valley area.
The importance of the Games to these economically disadvantaged areas has been a priority. Industrial and business premises will grow in the Thames Gateway and the Athletes Villages will offer a much needed boost to the housing market. The sporting facilities themselves will become part of the fabric of this revitalised community.
The road and rail transport schemes being developed for the Games will substantially improve the relatively poor access this area has had to London – with a hopefully positive effect on local housing markets.
Will the London legacy be better than the others?
I remember arriving in Barcelona in 1992 and the excitement about the Olympics had evidently given the city a huge lift. I am not surprised that the Barcelona property market continued to grow from 1992.
However I believe the impact of the Olympics is likely to be fairly low on a London-wide basis. The prime London market continues to flourish but it is hard to see any part of London that is not included in the Olympic improvements benefiting. While Athens profited from a new 'M25' and airport, no such substantial changes have been made in London.
East London will be the prime beneficiary due to this investment and the availability of some sites directly connected with the Games, including the Athletes' Village.
The likelihood of any substantial ripple through the rest of London seems limited other than firmly cementing the concept of London as a modern, thriving and truly cosmopolitan city.
If nothing else the international community will continue to see London as a haven away from the current woes of mainland Europe and this should serve to benefit the London community as a whole through this fragile economic environment.
Robert Bartlett represented team GB in the 1992 Barcelona Olympics