Plans to develop a high-profile site at Edinburgh’s Haymarket have taken a significant step forward following the appointment of a capital-based property developer.
Qmile Group, which also delivered the £750 million Quartermile project in Edinburgh, has been appointed by fund manager M&G Real Estate to develop the delay-plagued scheme.
M&G, the investment arm of insurer Prudential, acquired the four-acre site next to Haymarket Station in June for £49.1m. Former owners Interserve put the vacant former goods yard on the market in February last year after the planned overhaul of the site suffered from numerous setbacks.
The site has a gross development value of £300m, with planning permission already secured for three Grade A office buildings totalling 350,000 square foot, a 172-room aparthotel and provision for 40,000 sq ft of retail and leisure space.
M&G and Qmile, which are poised to outline revised plans for the site in the coming weeks, previously worked together on the Quartermile project, which was a redevelopment of the former Royal Infirmary of Edinburgh in Lauriston.
In 2014 M&G provided £82m of funding, considered to be one of Scotland’s largest forward funding deals, for the speculative development of two Grade A office buildings at the site: the 72,990 sq ft Quartermile 3 and the 128,600 sq ft Quartermile 4.
Quartermile is now home to businesses including global financial services company State Street Bank, Canadian fund manager BMO Global Asset Management and audio chip designer Cirrus Logic.
Chief executive Paul Curran said: “Haymarket is without doubt Edinburgh’s highest profile development project and provides an exciting opportunity to create a new place in the city centre.
“It is essential that it is successfully delivered to help underpin the city’s continued success as both a global financial hub and an internationally recognised tech centre of excellence.
“The supply of Grade A office accommodation in Edinburgh is at its lowest for more than ten years. With Quartermile now fully let there is a significant amount of pent up demand from occupiers and we are looking forward to providing more world-class office accommodation for them within city.
“With the retail, leisure and hotels components of the development, we will be creating a place with vitality and character which will enhance the existing fabric of the city. ”
Aaron Pope, director of asset management at M&G, said: “Partnering with Qmile Group ensures we are in the optimum position to fully realise Haymarket’s significant potential.”
Qmile is also currently developing the 52-acre, £100m Craighouse development in the capital.
The company was launched in May following a management buy-out (MBO) by Curran and finance director Mike Milligan.
The pair acquired the entire share capital in Quartermile Edinburgh Limited from London-based property fund manager Moorfield Group and funds managed by US-based investment advisor The Baupost Group.