A change of formula for Quartermile

The new blueprint for Quartermile will see around 350 extra homes built, the creation of a major public square in the heart of a new commercial district and the scaling down of plans for a luxury hotel on the site.

New images of the project - expected to lead to around 3800 new jobs once complete - were released today by architects Foster and Partners, creators of the world-famous Swiss Re Building in London.

One of Scotland's largest urban regeneration projects, it is expected to completely transform 19-acres of the old hospital site over the next few years, with large chunks of land already completely cleared of the former ERI buildings. Shops, bars, cafes and restaurants will feature on the new square, along with a four-star boutique-style hotel, boasting around 70 rooms.

But the landmark former Surgical Hospital building on Lauriston Place, which was previously earmarked for a five-star hotel, will now be used for housing. It is thought a lack of interest from upmarket hotel operators has forced the developer into a rethink.

But it means the development will now feature around 1000 new homes, compared to the 650 originally envisaged for Quartermile. The first of these are expected to go on sale next year.

The Evening News had revealed more than two years ago that the five-star hotel plans would remain in doubt because of the lack of interest in the concept.

Council leader Donald Anderson today said he was "disappointed" that the five-star hotel had been scrapped from the regeneration project.

In another surprise move, the historic brick Red Home, designed by Scottish architect Sidney Mitchell in 1895, which was set to be transformed into new bars and restaurants, is now set to be demolished to make way for a major new "L-shaped" office block and public square.

Plans for an office block on a site near Middle Meadow Walk has now been replaced by new proposals for another luxury flats development.

The move comes amid fears that the development of commercial space was too spread out and is now designed to make sure it is contained in the one cluster, near Lauriston Place.

Developers behind the scheme say the changes will reduce the "density" of buildings on the site and create more open public space.

They insist they are on track to deliver an "international-class" development, work on which started in May of last year and is due for completion in 2011.

City council leader Donald Anderson said: "I'm disappointed that the five-star hotel isn't going to be happening as it was an important element of the scheme and hotel occupancy in Edinburgh was running at an average of 77 per cent throughout 2004, so extra bed space of that kind is definitely needed.

"However there is no doubt at all that more residential accommodation is going to be needed over the next few years and that aspect is very welcome.

"This is one of the largest developments in Edinburgh for many years and will be a huge addition to the city centre. I look forward to seeing it taking shape and generating new jobs and investment for Edinburgh."

Plans for the various changes to the development have been lodged with the city council and it is hoped they will be backed by the local authority by the summer of next year.

The initial Quartermile scheme was backed by the city council in July 2003, despite opposition from community leaders and heritage organisations who feared that towering office blocks would ruin famous views of the city's skyline from the Meadows and Bruntsfield Links.

However, five months later the Scottish Executive rejected calls for a public inquiry into the proposals and gave the developers the green light.

The changes come in the wake of developer Gladedale Group buying out Taylor Woodrow's share in the scheme, a joint venture with the Bank of Scotland.

Among the elements of the scheme which are remaining the same are a seven-storey, 100,000sq ft office complex being built on Lauriston Place.

Other constants include a pedestrianised street running across the site from Middle Meadow Walk, where a seven-storey block of flats will be created, and a string of new residential blocks facing onto the Meadows. Some of these are being created in former Victorian medical blocks dating back to the 1870s.

Jim McIntyre, managing director of Gladedale Capital, said the changes announced today would realise the "full potential" of the site as one of Europe's leading premier business, residential and retail quarters.

He said: "Fundamentally, we believe these revisions not only respond to current market conditions but they also secure the best possible development in terms of open space, amenity, jobs and economic benefits.

"Quartermile is a major ten-year project and any development of this scale will inevitably evolve and change.

"We believe the new masterplan will deliver an international-class development which is best for residents, businesses, the city and its architectural heritage."

A spokesman for the Quartermile consortium said: "The main changes to the masterplan centre on the creation of a vibrant central square to provide more open space at the heart of the site.

"This will create a more cohesive mix of uses at the centre of the scheme and reduce the 'density' of the site by creating more open space between buildings and improving the public areas.

"The five-star hotel, which was to have more than 250 beds, was put out to the market a good while ago but it just was not proving viable and we feel that the new proposals are more commercially realistic.

"The office space is also down from around 400,000 to 350,000 sq ft under the changes that we're proposing, but the big gain along with the increase in open space is the extra residential units we will deliver."

Gladedale, which specialises in city regeneration projects across the UK, operates Gladedale Homes, Bett Homes, Furlong Homes and Furlong City subsidiaries.

The development earned its name because it is both a quarter of a mile from Edinburgh Castle and the same distance across the site from corner to corner.

Foster and Partners has also worked on the Reichstag, Berlin, the British Museum and Hong Kong's new airport.

The practice won the Stirling Prize for London's uniquely-shaped Swiss Re Building, famously dubbed "The Gherkin", on the banks of the River Thames.