University sells off prime campus site to developers

The Craighouse Partnership, which acquired the 51-acre site for an undisclosed sum this week, also plans to build new properties on the land.

However, heritage groups said they would keep a close eye on future planning applications to ensure there wasn't too much development on the site.

One of the partners, Sundial Properties, said town planners had accepted new development was essential for the long-term survival of the site.

William Gray Muir, managing director of Sundial, said: "We have spoken to Historic Scotland and council planners and it is accepted that it needs a degree of new development to fund this site in the long-term.

"The size of that new development is what we need to agree on with the relevant authorities and with local stakeholders.

"It is an expensive site to manage," he added.

The seven A-listed historic buildings, which once housed the Royal Edinburgh Asylum, are to be converted into high-end flats with original features.

However, the developers said the factoring fees generated, to maintain the historic buildings and large grounds, would be too high to be borne by those occupiers alone.

Instead it hopes to create mid-sized housing and family homes amid new landscaping.

The university will remain on the site until 2013 but most students and staff based on the campus have either already moved to the university's new 60 million Sighthill campus or will move to the current Merchiston campus next year.

But some buildings which are already vacant will transfer now, with the full site transferring over to the partnership in 2013.

The first homes could be available from 2014.

However, there is concern that the number of new homes planned for the site could be too many for local infrastructure, such as roads, to cope with.

Marion Williams, director of the Cockburn Association, Edinburgh's main heritage watchdog, said: "We will be keeping a close eye on this development.

"Napier has been very good at projects on their land but Craighouse is a difficult site and any development needs to be well done."

Funds from the sale will be re-invested in the university's estate as part of an ongoing 100m revamp of its buildings.The Craighouse Partnership is led by Sundial Properties, a local Edinburgh company that has developed dozens of listed properties in the city, including Leith Hospital.

The other partners are LA&P, a specialist residential planning and development company, which will oversee the plans for the site and the Mountgrange Real Estate Opportunity Fund, which funded the acquisition.

Professor Dame Joan Stringer, Napier principal, said: "I am extremely pleased that the historic campus will be reborn once again by experts in the restoration of listed buildings."