London SE1 website team

18 million loss for London Eye

Despite its position as the South Bank's top tourist attraction, the London Eye racked up a loss of £18 million last year as it struggled with crippling interest repayments.

Despite a 1 million drop in ticket revenues last year, the Eye would be making a healthy profit if it were not for the 25 per cent-a-year interest rate being charged on the loan by British Airways.

Latest accounts show that the attraction lost 17.6 million last year compared with 10.9 million in 2002.

British Airways spent 48 million building the wheel five years ago. Since then, the debt owed to the airline has increased to 130.6million as the interest piled up. Last year's repayments totalled 29 million.

"In the late Nineties no one else was interested in funding a high-risk project of this kind. It was seen as an acceptable rate of return," a BA spokeswoman told the Evening Standard on Friday.

London Eye managing director David Sharpe said: "The company is very keen to push this refinancing through because otherwise the business is doing well. Bookings in the run-up to Christmas are very much up on last year."

3.6 million people are expected to have visited the London Eye during 2004.

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