Doubts grow over Lend Lease's £1.5bn Elephant & Castle regeneration

FUNDING fears are growing over the £1.5bn regeneration of Elephant and Castle as the council and preferred developer Lend Lease continue to argue over the details of a final contract.

The two parties must agree the details by the end of the year, but are believed to be having trouble sorting out Lend Lease's funding arrangements for the scheme.

Southwark Council project director Jon Abbott said the council expected Lend Lease to fund the 15-year project and complete most of the development work itself.

But the firm's ability to do this has been thrown into doubt after it failed to raise £450m to build the Olympic village.

Abbott said Lend Lease was also currently thrashing out the details of the project's masterplan with architect Make.

He said: "We are committed to this project, but we expect Lend Lease to have the capacity to roll-out the scheme as a whole."

A Lend Lease spokeswoman said the firm wanted to resolve transport requirements for the scheme with Transport for London before signing the final agreement.

A statement from the company said: "Lend Lease remains committed to Elephant and Castle and this is demonstrated by the recent signing of a partnership agreement and the huge amount of work carried out on project masterplanning during 2008."

Abbott warned that movement on the site was unlikely before 2010, with a planning application not expected to be lodged until December 2009.

This means complementary schemes on the borders of the 70ha regeneration site will be open before the actual project starts.

On track for a summer 2010 completion date is Brookfield Multiplex's 43-storey Strata tower in Walworth Road.

First Base expects to finish its nine-storey tower Printworks by March 2010 and its 44-storey tower 360 London by December 2010.