400 new jobs as work on old ERI site moves ahead

Initial work has already begun at the south-west edge of the site, where three new-build blocks of apartments will be created and three former hospital buildings will be redeveloped.

Developers hope to complete the apartments, which will be priced from 170,000, by the winter of 2012.

However, they also today admitted that the wider development, first started in 2004, will now not be completed until 2016 - four years later than originally scheduled - as a result of work being slowed down because of the economic climate.

Two offices, a hotel and hundreds more apartments still need to be built before the massive site is completed, while restaurateurs, cafe operators and retailers need to be found for a number of units already created.

Paul Curran, managing director of Quartermile developer Gladedale Capital, said: "The market is tough for everyone but we are confident that we have had good sales over the last two years and we have very little stock left. If we don't start building now we will have nothing to sell.

"We have had a lot of success recently in building and selling 100 per cent off plan, so that also gives us confidence.

"Part of it is location; Edinburgh remains strong but our location, with the university, the Meadows and the overall environment and feel of the site, means we have done very well."

A centrepiece of the new site is to be two hotels, likely to be one "boutique" hotel and one aparthotel.

In late 2009, it appeared that two buyers were on the brink of a deal to buy the B-listed buildings and take the development forward. But Mr Curran said a lack of funding for hotel developers meant the deals had not materialised.

A new marketing drive to find potential operators of the hotels is due to get under way in the winter, while developers will also start a hunt for potential occupiers of two new office buildings that will be developed.

The former surgical buildings next to Lauriston Place are also to be turned into hundreds of new homes but a definite start date for that part of the development has not yet been confirmed.

When asked when he now expected the wider development to be completed, Mr Curran said: "It is very much market-dependent and things can speed up if the market improves, or slow down if it has to, so we have to be flexible but we would hope to be out by 2016.

"If you look at the scale of the development compared to others across the country the fact we have been able to continue selling is a testament to the location and the development quality and is a huge achievement."

Local councillor Mark McInnes said: "Once a site like this gets planning permission it is very important that activity does go ahead and building that has been allowed by planning goes ahead relatively quickly.

"People have concerns if they see sites just lying empty so the Quartermile developer producing a plan is welcome and people in the area will be pleased to hear it is progressing."