Caltongate dream has become a nightmare

Published on Thursday 5 August 2010 14:22

As hopes of reviving the massive Old Town development finally disappear, Adam Morris asks what happens now

IT was supposed to be one of the largest redevelopments in the city's history.

New flats, offices, shops and even a five-star hotel would have been created as part of the 300 million project.

But a hardy group of local campaigners launched an aggressive heritage campaign against the Caltongate scheme, and although they failed to persuade the council to kick out the project, their delaying tactic was widely credited for putting the brakes on the masterplan.

Original developers Mountgrange, which went into administration last year, believed that had the planning process not taken four years - twice as long as their worst-case scenario - they would have got the ball rolling before market conditions plummeted.

But it was the city council itself that delivered the latest blow this week, pulling out of the plans and taking with it several key properties.

The future of the scheme is now completely up in the air, with the short term at least meaning an unsightly gap site remains.

Ron Hewitt, chief executive of the Edinburgh Chamber of Commerce, said the longer the site lies undeveloped, the greater harm it would cause the city economically.

"No-one has a duty to invest in Edinburgh," he said. "They can look to Glasgow, which is already catching up, or places like Leeds where the planning process is quicker.

"These things are funded by financial loans, and the longer the process takes, the more interest is paid.

"In effect, the more time it takes, the less money there is to ensure quality in the scheme."

The chamber was supportive of the initial project, and believes something similar is needed. "Not only would it have provided huge economic benefits, but it would have joined the thriving east end of the city centre with the fairly-isolated Holyrood.

"Contrary to what you hear, there were quite a lot of residents in support of this, who wanted to see their neighbourhood improve.

"Edinburgh can't afford to wait if it wants to be a true European economic capital city. We do need more offices and there is a shortage of four and five-star hotels."

After Mountgrange went into administration, control of the marketing for the site was handed to the administrators Deloitte. But the real power still lies with the Bank of Scotland, which is owed more than 70m by Mountgrange, and it wants to sit tight until the property and construction industry recovers sufficiently to make it profitable again.

It is understood that the council leaders and officials were growing increasingly frustrated at the length of time Deloitte was taking to agree a deal on the site.

Councillor Tom Buchanan, the city's economic development leader, said: "The council would prefer that its property is developed as part of a wider development. We own a number of properties and the reason that we are taking back our property is we are trying to make sure a deal goes ahead in a prompt fashion.

"We need to ensure that the council's interests - and the interests of the citizens of Edinburgh - are taken forward in a prompt fashion.

"There is interest in the wider site. Allied London was the preferred bidder, but there were under-bidders and this action might lead to them coming back."

Protesters' lengthy objections won the backing of many influential individuals, but ultimately failed to sway councillors who couldn't ignore the huge economic potential of the site.

Bill Cowan, planning secretary of the Old Town Association, which fiercely objected to the plans, said they did want something to happen there and rejected accusations they were against any redevelopment.

He said: "We're very keen for something to happen there, just not wholesale demolition of the Canongate. What was being proposed had no quality. The marketplace has totally changed now and everything would have to start again from scratch.

"We want to see something that is sympathetic and acceptable to a World Heritage Site."