Thousands gathered in London on Wednesday morning to celebrate the announcement that the British city had been selected to host the 2012 Olympic Games.
London will become the first city to host the games three times, and people there couldn’t be more excited. Obviously, some of the excitement, okay most of the excitement, centers around the economic boost that the city will see.
Already, the building industry is benefiting. Yesterday, shares of London-based construction companies saw a boost in their prices on the markets, as London plans to spend $3.8 billion on stadiums, roads, and railways to ensure the cities infrastructure can support the influx of people and vehicles during the busy time.
—Balfour, Britain’s number one construction company, jumped up 4.2% yesterday
—Hanson Plc, the premier supplier of sand and gravel in the world, rose 6.6%
—Persimmon, which represents the largest market share of the UK homebuilding industry, surged 7.3%
—Galliford Try Plc, Wimbledon’s tennis court builder, rose 5.7%
—Severfield-Rowen Plc, a stadium builder, rose 6.6%
The 2012 Olympics could go a long way in boosting Britain’s slowing economy–however, that’s still seven years away. In the meantime, a lot of pounds will have to be spent in preparation–dollars that probably could be spent in better ways.
While it will be interesting to see how much money the 2012 Olympics brings in for London and the UK economy, I wonder if the books will balance, let alone show a profit, when you consider how much money will be spent in the meantime.