Five of Edinburgh’s most prestigious development sites are on the brink of being sold in deals that could trigger construction projects that would create thousands of jobs.
National and international developers – some from as far afield as the Middle East – are said to be vying for a range of sites that are currently on the market. Among them is Caltongate, where a consortium of South African investors has agreed a price with administrators of the failed developer Mountgrange Capital and now only needs to strike a deal with the city council in order to gain control of the Old Town site.
A closing date for bidders has also been set for next week for the former Fountain Brewery site, which was only put up for sale in early summer. Other sites where there is hope of an imminent deal include the redevelopment of the former Edinburgh Royal Infirmary at Quartermile, the former Donaldson’s School for the Deaf at West Coates and the old Royal High School in Regent Road.
Cameron Stott, a director at property firm Jones Lang LaSalle, said: “It would be great for the city to have some new developers hopefully kickstart work at these gap sites, which have been sitting empty for several years.”
Development of the Caltongate site alone would create nearly 1700 jobs and around £150 million of investment for the city. Ronald Persaud, a director of the joint venture company that first announced plans for the site in 2001 before selling it on to Mountgrange Capital in 2004, is heading the South African consortium looking to snap up the site. It is understood they have now agreed a price with Deloitte, administrators for Mountgrange.
The consortium has also signed a “conditional missive” with the administrators, with an interest in taking the site forward broadly in line with the existing planning consent, which includes hundreds of homes, offices, a five-star hotel and conference centre and a series of shops and cafes.
But the deal rests on an agreement being struck with the city council to acquire land it owns, including the Cranston Street garage, Canongate Venture building and East Market Street arches.
A senior council insider said: “Council officers are exploring with the prospective owners of the Caltongate site how the council might best help the owners to unlock its development in line with the existing planning approval.
“The ultimate prize of 1685 new jobs and around £150m in private sector investment from the development of Caltongate is clearly important to the city, especially given current uncertainties in the wider economy.”
The Quartermile site was put up for sale last month by current owner Gladedale Capital and strong interest has been registered. Development companies across the UK, Europe and even from the Middle East are said to have expressed an interest in the site, with income from businesses and residential properties already on the site said to be proving attractive to potential buyers.
And a closing date of next Wednesday has been set for the former Fountain Brewery site that was bought by the Lloyds Banking Group for £30m in 2008, following strong interest from UK-based investors.
The 13-acre site has planning permission in principle for apartments, shops, cafes and leisure space, as well as the potential for a hotel, conference centre and office space. Duddingston House Properties is also expected to announce a deal with an occupier of a new hotel proposed for the old Royal High School building in Regent Road in the coming weeks, while housebuilder Cala is considering offers received for the landmark Donaldson’s School for the Deaf.
Councillor Tom Buchanan, the city’s economic development leader, said: “The level of interest being shown in these key development sites sends out a clear signal that Edinburgh is very much open for business.
“Going forward, these developments have the potential to create hundreds, if not thousands, of valuable and sustainable jobs for the city.”