Olympics: London calling, where are you?

A man runs along an almost deserted Millennium Bridge, with St Paul's Cathedral in the background centre, in central London. People are heeding government advice and staying away from central London. Show more

Apocalyptic warnings to both visitors and residents to avoid central London during the Games were taken seriously. Perhaps too seriously. Hotels are empty, tourist attractions deserted, the city a ghost town.

They had been told to brace themselves for the influx of Olympic visitors. Bumper takings were predicted; queues around the block; gridlock on the streets.

Instead, shopkeepers, restaurateurs, hoteliers and staff at London's top tourist attractions have found themselves looking forlornly at empty aisles, vacant seats and tills untroubled by sales.

Less than a week into London 2012 and the reality has dawned. The warnings of traffic chaos and of more than a million visitors descending on the streets and tourist attractions of London have proved effective to the point of calamitous and turned much of the heart of London into a ghost town.

Figures released yesterday made it clear. Museums have reported a 30-35 per cent drop in visitors over the past two weeks. Traffic is down by 20 per cent in the same period. West End theatre ticket sales have dropped by 10 per cent and 7 per cent fewer visited London's East End last Friday and Saturday.

Hotels, many of which increased rates in anticipation of an Olympic rush, have been forced to drop their prices - and then drop them again. One hotel in Hyde Park which had been advertising its best twin room for £500 is now selling it for less than £100.

"London has approximately 300,000 foreign and 800,000 domestic visitors every day in August. These people have been told implicitly that they should stay away, and they have done so," said Tom Jenkins, chief executive of the European Tour Operators Association.

"The numbers are currently dramatically down on last year. How far down will be determined by how long Transport for London maintains the 'Don't come into London' campaign."

Recorded messages from London's mayor, Boris Johnson, telling passengers on the Tube, London's metro: "Don't get caught out. Get online and plan your journey," have been switched off and some of the "Zil" Olympic lanes opened to other traffic. But many fear the damage has already been done.

By 9am on a weekday taxi drivers at King's Cross Station would normally expect to have carried 500 passengers. By 9am yesterday that figure was just 182.

"There are two groups of people missing. The first are general visitors to London, who are staying clear because of the perception that it will be busy," said Bernard Donoghue, of the Association of Leading Visitor Attractions.

"The second are Londoners and Brits who have been warned there will be a transport nightmare. Our message to them is that while it may be sensible to avoid certain peak times and locations, transport is running very smoothly."

Many Londoners were advised to work from home if at all possible. As many as a third of the five million employed in the capital were expected to do just that.

The perception that London would be a no-go nightmare where rooms would be fully booked and streets unpassable has been so effectively transmitted that, according to Christopher Woodward, director of the Garden Museum next door to Lambeth Palace, there has been a drop in the number of people booking wedding receptions at the venue over August.

Elsewhere, Londoners complained that overzealous "herding" of Olympic visitors towards venues was actively directing them away from shops and local attractions.

Locog, the Games organising committee, was yesterday forced to review the placing of safety barriers in Greenwich that have effectively blocked off access to Greenwich Market, just yards from the gates of the Olympic Equestrian venue.

"It's been a tough, tough time for small businesses," said shopkeeper Lara Boyle. "We need this boost. If our businesses die because of this, what sort of legacy will that leave?"

Another stallholder said: "I've never seen a July as bad as this, ever."

According to some, part of the problem lies in expectations that were inflated in the first place. Dr Andrew Smith, of the University of Westminster, an expert in the strategic use of sport events by host cities, pointed out: "London is already the world's most visited city. It was always unrealistic to expect the sort of boost to figures that was forecast."

Meanwhile, independent economists warned that, far from giving a short-term boost, the Games could in fact damage the economy.

Scenes across many parts of central London, where Olympic Volunteers threatened to outnumber the visitors they were there to help, certainly gave credence to their words.

But a spokesperson for VisitBritain urged patience and optimism: "This really is about the long-term gain and a long term boost. It's far too soon to start drawing conclusions."

Paul Deighton, chief executive of Locog was similarly pragmatic. "I think by the end of the Games there will be a very different picture."