The Inverness-headquartered housebuilder will begin work in early spring on 16 apartments at Drumbrae, in the Corstorphine area.
New chief executive George Fraser said: “The time is now right to re-enter [Edinburgh] and we will look for further potential in the capital once Drumbrae is up and running.”
Fraser has just taken the helm at Tulloch from Inverness Caledonian Thistle president David Sutherland, who led the company for three decades.
The housebuilder had been active in Edinburgh until about ten years ago, but has since concentrated on the north and west of Scotland.
Tulloch, which directly employs 240 staff with 500 more working indirectly through sub-contractors, has made losses in recent years. It is part-owned by Lloyds Banking Group, following a refinancing in 2009. The firm sold 310 homes including 100 “affordable” homes in 2011, similar to the year before, and now plans its largest array of new sites for several years.
It said other significant “hot spots” it was targeting for further investment were the Aberdeen area and the Black Isle. Fraser said: “It’s been our experience from recent developments that the Aberdeen and Grampian market has remained commendably steady in the current economic climate. We are examining fresh opportunities in that area.”