Developer loses Aberdeen council HQ legal challenge

The move was blocked at the Court of Session. Picture: Toby Williams

• HFD loses legal challenge to redevelopment bid

• Aberdeen council entered into deal in May to create new civic space

• City entering into ‘joint venture’ with Muse Developments over the project

Lord Brailsford cleared the way for the transformational scheme to begin following a judicial review at the Court of Session into claims by the HFD Group that the guidance issued to companies seeking to develop the Broad Street site at St Nicholas House had been flawed.

HFD lodged its legal challenge at the Court of Session after the council announced three months ago that Muse Developments, one of Britain’s leading commercial and urban regeneration companies, had been named as the preferred bidder from a four-strong short list to transform the “eyesore” former headquarters into a new and vibrant civic square in the heart of the Granite City.

Councillor Barney Crockett, the leader of the council, also announced in May that the undisclosed commercial deal with the developer would involve the council facing an “element of risk” in a project in which the local authority will be involved in a “joint venture” capacity. Under the deal, the site would be leased to the developers, and returned to the council’s ownership after 35 years.

HFD claimed that European and Scottish laws on the disposal of council-owned land had been breached and argued in court that its bid to redevelop the Broad Street site would have been different if the firm had known a joint venture was a possibility.

Morag Ross, advocate for HFD, told the Court of Session the wording of the bidding document was ambiguous and it was not until Muse came forward with its joint venture proposal that HFD realised it was an option.

But, delivering his judgment at the Court of Session, Lord Brailsford confirmed that the decision made by the council was “lawful and reasonable.”

Councillor Marie Boulton, the deputy council leader, welcomed the ruling. She said: “This is very good news for the city. A huge amount of work went into ensuring that the best deal was secured for the city and the council discussed the options for the site at great length before agreeing to appoint Muse as preferred bidder. I really am pleased that we can now move ahead with our plans for the site, in partnership with Muse Developments.”

Councillor Willie Young, the authority’s finance and resources convener, said: “Lord Brailsford’s judgment is very welcome for the city. We have been proven to be right and are now looking forward to moving forward with the process for this exciting development, which will kick-start the regeneration of the city centre.”

And Valerie Watts, the council’s chief executive said: “I am very pleased that Lord Brailsford has found in the council’s favour. We are very excited about Muse’s plans to develop the site and will continue with business as normal.”

Manchester-based Muse Developments plans to redevelop the prime site - opposite the council’s new headquarters in Marischal College - into a series of linked buildings, up to ten storeys high , offering a mix of hotel, offices, restaurants and retail space. St Nicholas House, a 15 -storey tower block, built in 1968, has lain empty since the council moved more 1000 staff to its new headquarters across the road in Broad Street to the refurbished Marischal College in 2011.