The City of Edinburgh Council has agreed to suspend the £25m redevelopment of Meadowbank Stadium due to a decline in land and property values.

It had been anticipated that the sale of a third of the land at the stadium site would have generated a capital receipt of £17m to help fund the project, but a recent estimate suggested that the current value may only be worth £5m. A meeting of the full council, which had earmarked £6m for the scheme, supported recommendations to delay the scheme until land values recover.

The delay will also mean athletes can continue to use the existing facility in preparation for the 2014 Glasgow Commonwealth Games. Gordon Mackenzie, the council's finance leader, said: "We have experienced a significant drop in land values and the numbers simply don't stack up at this time."

Deidre Brock, the council's sports leader, added: "While we wait for economic conditions to improve, we need to make sure that athletes have access to training facilities in the build up to the Olympic and Commonwealth Games." It is hoped that new funding for the Meadowbank project may be secured from the council's capital programme for 2009-12.