Caltongate buildings set for a new short lease of life as site lies unused

Published on Tuesday 22 December 2009 09:23

CITY council leaders are drawing up plans to bring its flats and offices on the Caltongate site back into use, it emerged today.

The council has confirmed that it is looking at whether it will be commercially viable to find a use for the buildings it owns on the site.

The full proceeds of the sale of the council's C-listed Canongate Ventures building and nine one-bedroom flats to original Caltongate developer Mountgrange were never received because the firm plunged into administration.

Now the council is looking at whether the flats could be used as temporary council housing or homeless accommodation. It is also looking at ways of filling the office space it has on the site.

Although the council said it will not create "secure tenancies" – meaning any tenants could be evicted as soon as any development work starts – the proposals are a sign that the site could lie empty for some time to come.

A city council spokesman said: "We are exploring the options for bringing this council property back into use."

Planning leader Jim Lowrie added: "Temporary rentals require the consent of the administrators. Whilst bids for progressing the whole Canongate project are being assessed, the administrators have indicated that they are reluctant to grant any lets.

"Options are, however, being explored to bring the Canongate flats back into use without creating secure tenancies."

The 300 million Caltongate scheme – which would have seen a five-star hotel and scores of shops, offices and homes built on the site of the former New Street bus depot – collapsed in February when developer Mountgrange Capital went into administration.

It emerged soon after that Bank of Scotland, which was owed 73.8m by Mountgrange, was keen to see the site mothballed for at least a year in order to ensure it is not sold on the cheap.

Deloitte said in August that a shortlist of six potential developers were vying for control of the site. The administrator today declined to discuss how long it could take before a deal is struck and insisted any use of the buildings by the council would not be able to involve any long-term agreements.

John Reid, head of reorganisation services at Deloitte in Scotland, said: "The joint administrators are managing a confidential process with several interested parties.

"Given the stage of the process the company is unable to enter into any long-term agreements on the property assets."