Once finished, the area will provide 10,000 homes and 10,000 jobs, three new primary schools and a secondary school, health facilities, a state of the art commercial sector and waterside park.
The deal represents good value for money and provides an excellent basis for delivering a legacy that will be central to regeneration across East London.
Under the deal:
Government will fund OPLC with £138m so they can purchase the LDA’s land holdings in the Olympic Park and at Three Mills;
to reflect the level of debt taken out by the LDA in acquiring the site, the agency will be relieved of its commitment to pay £300m to the ODA;
the LDA will repay £369m of debt between 2011 and 2014 without the need to take out any further loans over the same period.
Communities Secretary, John Denham said:
"This is an important deal that will help create up to 10,000 homes and up to 10,000 jobs in the Olympic Park, schools, health centres and many other facilities that will ensure this area has a firm future.
"This deal represents good value not only for the taxpayer but for Londoners and lottery good causes and will provide a legacy that will benefit people across the region for years to come.
"By working hard with our partners we now have an agreement that is robust, affordable and will provide a return on investment that will help deliver a dynamic legacy for the Olympic Park."
Olympics Minister, Tessa Jowell said:
"The transfer of land to the Olympic Park Legacy Company is an important step in securing a long-term legacy for the Olympic Park. No other host city has been as far advanced in its legacy planning as London and this decision means that the OPLC can now go full-steam ahead with its development plans for the Park and building its relations with potential investors."
London Mayor, Boris Johnson said:
"This has been a long and complex negotiation, but I am delighted to say we have now reached agreement with government on all the issues under discussion. The next step will be to carry through the land transfer to the Legacy Company. This is a good deal for London and for legacy.
"We have preserved the principle that the company should be an equal partnership between the Mayor and government and ensured that the financial arrangements will protect the LDA and its other important programmes in London."
Chair of Olympic Park Legacy Company, Baroness Ford said:
"I am absolutely delighted to have reached this milestone whereby we take clear ownership of the LDA land within the Olympic Park. This enables the company now to move forward and to engage very confidently with a range of development partners. We could not have hoped for a better outcome."
Chief executive of the London Development Agency, Sir Peter Rogers said:
"This is a good deal for London.
"The LDA has negotiated benefits for London of at least £875m, the majority of which is guaranteed. London will continue to benefit from future sales but the removal of a total reliance on increases in property values greatly reduces the risk involved in the original proposal.
"This certainty allows the LDA to reduce drastically its debt over the next few years and to focus on its core business. That is why the LDA Board proposed in 2008 to create a new body to concentrate on securing a lasting legacy from the Games. I am therefore delighted with this deal as it will complete the establishment of the Olympic Park Legacy Company, who can now plan how to use the land to get the best possible outcomes for London."
A new Memorandum of Understanding will be drafted to reflect a new arrangement for sharing of proceeds from the eventual sale of the Olympic Park:
the Government will receive 85 per cent of the first £650m of proceeds, the remainder going to the Greater London Authority (GLA);
from the next £1.3bn, the GLA will get 15 per cent, the National Lottery will receive £675m and the remainder will go to the Government;
from any further proceeds, the GLA will get 50 per cent, the remainder going to Government.
Under this arrangement, the National Lottery will retain the same entitlements to the net proceeds from the Olympic Park as set out in the 2007 Memorandum of Understanding.
The LDA will be able to keep the receipts from sales of other Olympic land outside the Park and the Three Mills site that is not transferred to the OPLC. In addition, the GLA will gain a share of the Olympic Village receipts, after all ODA costs have been paid, and this will be recycled back into supporting OPLC.
The LDA will also transfer LDA staff and the LDA Olympic programme budget to OPLC. The Mayor has also committed to meet £10 million per year of the OPLC running costs.
To ensure the future value of the Olympic Park and its strategic direction in the interests of both the national and London taxpayer, the Government and the GLA will have an equal say in all decision making. This will be set out in published Framework Document and will include approving the OPLC’s Corporate Plan and Annual Budget.
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