Argent, the developers leading the £2bn regeneration of London's King's Cross area, will need to use its own money to fund the next phase of the project after talks with a consortium of international banks fell through.

Negotiations over the £400,000 financial package ended as conditions in the financial market deteriorated. Argent needs to start the next phase of work this month in order to finish the first buildings in time for the September 2011 term at the University of Arts, one of the main developments on the site.

Argent has agreed to fund the necessary work following talks with the other stakeholders involved in the joint venture behind the redevelopment. According to the Financial Times , the work will be partly funded through a part equity, part debt arrangement - also know as a mezzanine facility.

The next phase of the King's Cross Central project is a 8,000,000 sq ft office, retail and residential scheme on a 67-acre brownfield site. The development is being driven by the developers and landowners London and Continental Railways and DHL-Exel.

The plans also include hotels, swimming pool and gym facilities, an indoor sports hall and two health centres along with the new University of the Arts London, which will host 5,000 students from Central Saint Martins College of Art and Design, by 2011.

Over 40 per cent of the development will consist of new public spaces, including three parks, five squares and 20 new streets. The development will also provide up to 50 new arts and music venues including new theatres, independent cinemas, exhibition space and new community facilities.

The many architects behind the project include Allies and Morrison, Bennetts Associates, David Chipperfield, Maccreanor Lavington Architects, David Morely Architects and Niall MacLaughlin Architects. The remaining architects include masterplanners Pophyrios Associates, PRP Architects, de Rijke Marsh Morgan, Stanton Williams, Studio Dowie Architects, Townshend Landscape Architects and Wilkinson Eyre.

The work will be carried out in collaboration by contractors Carillion, Kier Group, HBG and Nuttall.

The first phase of the project included speculative development and 250,000 sq ft of office space pre-let to J Sainsbury.