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A giant advertising-clad sphere in London’s former Olympic Park backed by US tycoon James Dolan is at risk of being blocked after ministers forced a holding order on a development that critics claim will be an eyesore for much of the UK capital.

This week, Michael Gove, levelling-up secretary, temporarily halted the taking of any decision over the 90-metre-high spherical music and entertainment venue in Stratford, the first step towards further scrutiny of the controversial scheme.

Gove is now considering whether he should have final say over the project. The government made a similar move before starting a public inquiry into redevelopment of the ITV studios last year.

The holding directive will temporarily stop decision-making over the scheme by the mayor of London or the London Legacy Development Corporation, the public body granted sweeping planning and other powers over areas developed for the 2012 Olympics.

At the heart of the objections to the London Sphere are plans to clad the giant ball in LED screens that will carry advertising and video. Critics say the venue will swamp the area’s already crowded public transport and blight thousands of homes with light pollution.

The cost of the sphere has not been disclosed but the developer, Madison Square Garden Entertainment, is building a similarly sized sphere costing $2.1bn in Las Vegas, which is due to open in September with concerts by U2.

The group, which also runs New York’s Radio City Music Hall and Madison Square Garden, the arena used by the New York Knicks basketball team, is controlled by Dolan.

He recently caused an outcry by using facial-recognition technology to stop lawyers working on litigation against his company from entering both venues.

The proposed 21,500-capacity venue in the UK capital has attracted fierce local opposition, including from West Ham MP Lyn Brown and Newham Council, as well as rival entertainment group AEG, which owns the O2, the distinctive venue that lies a short distance away on the other side of the river Thames.

The LLDC approved plans for the sphere in March last year, after some 850 residents and opposition groups filed objections to the scheme, with more than 350 groups filing statements in support.

The decision was criticised as undemocratic by local politicians because the deciding votes were cast by unelected independent LLDC members.

Much of the concern is around the sphere’s potential to disturb residents. The site, near Stratford station, is very close to a block of student apartments owned by Unite Students, with another housing development, New Garden Quarter, overlooking the site’s north side.

Brown, the constituency MP for the site, said residents were “clearly not happy” with the idea they were going to have this “massive bloody development stuck in front of their windows”.

Referring to an offer by MSG to provide blackout blinds to properties within 150 metres, Brown said: “My view from the off is that there isn’t an understanding of the annoyance, of the real damage there’s going to be to the living conditions of the people in the area.”

She hopes Gove will call the project in for a detailed planning review.

An MSG Sphere London spokesperson said: “We always expected the government to take the opportunity to review our application and their formal notice has absolutely no impact on our plans in any way.”

The sphere will “deliver many cultural and economic benefits, including creating thousands of jobs and generating billions of pounds for the local, London and UK economy”, it added.

The next stage of the process will be a referral to the Mayor of London. Both Rokhsana Fiaz, the mayor of Newham, and AEG have written to Gove and the Mayor of London this month urging them to refuse the application.

In letters seen by the Financial Times, AEG said that the scheme “has been designed for downtown Las Vegas and transposed on to a constrained car park site in Stratford, towering over hundreds of surrounding residential properties”.

The letter added: “It is wholly inappropriate for its location. The plans see the neighbouring residential occupiers forced to live face to face with an enormous, glowing advertising ball.”

The letter from Fiaz this week said the scheme would have an “adverse impact” on the health and wellbeing of local residents owing to its “scale and unsuitability”.

The sphere has an external “skin” of programmable LEDs. In its letter of objection, AEG said this facade would be “equivalent to forty-two times the size of the Piccadilly Circus screens”. 

The letter said that “the nature of the illuminated facade means that the proposals will change the skyline of wider London too”.

MSG has agreed that advertising would only be shown on the Sphere about a third of the time it is illuminated, with the screens otherwise showing “artistic” content. It added they would be switched off entirely overnight.

“We are mindful of the differences between Las Vegas and Newham. The London Sphere will be different from the Vegas Sphere in its operation, including measures such as limiting its brightness, the time of day it can be illuminated, the amount of advertising it can display, and more,” it said in a statement.

Nate Higgins, Newham Council’s Green party councillor for Stratford Olympic Park, said that all the elected representatives for the area opposed the scheme. “It’s being pushed forward by unelected officials over-ruling elected councillors,” he said.

An LLDC planning report acknowledged criticism of the project’s scale, and its impact on Stratford station and local residents but said the sphere would also “establish a strong sense of place at a scale that is not considered to be excessive, taking account of the established scale of surrounding buildings”.

An LLDC spokesperson added that the applications “have been subject to robust review and detailed officer reports”. 

An EY report for MSG said up to 3,200 staff would be employed each year across the UK, and bring £2.5bn to the London economy in its first 20 years of operation.

But Higgins questioned whether the project was the right way for the LLDC to protect the area’s Olympic legacy.

“Are they really expecting people to accept that a giant dystopian orb, as tall as Big Ben, coated by advertising screens, is the best we can do?” he asked.

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