A major new scheme in Edinburgh could see PBSA added to the development mix. The New Town Quarter Edinburgh project is set to breathe life into the Scottish capital.
Currently, the six-acre site on Dundas Street has planning permission for 350 new homes with a variety of Build to Rent, private residential, mid-market rent and office space.
However, developer Ediston wants to change two of the blocks from Build to Rent to PBSA, without altering the appearance of the original plans. Additionally, they want to change the proposed office area into more residential units.
The PBSA development would host 580 students and the office block would be converted to around 80 homes, increasing the number of homes for sale to around 200. The mid-market rent block of 108 homes would remain the same.
Ediston plans to lodge a formal notice of its proposed changes for the New Town Quarter project, followed by public exhibitions to let local stakeholders know the reason for the alterations.
The developer said inflation had caused a significant impact on the construction market, so the original plan is now not financially viable. The change of plans for the site have been communicated via a letter to the local community.
“The construction market has been coping with the pressure of cost inflation, resulting in projects not being viable due to construction costs being too high. The knock-on effect is a tighter contracting market with a lower number of organisations being willing and able to take on major commercial and residential projects.
“Rising interest rates has had an impact too, creating what is effectively a double whammy effect of both increasing the cost of development finance, whilst depressing the valuations of commercial buildings, such as offices.”
Ediston’s letter to local residents
The company also claimed that the Scottish Government had killed off the funding for Build to Rent projects, and they have received approaches from major PBSA firms who are willing to enter into a partnership agreement.
“There has been a massive change in the Build to Rent sector, as the Scottish Government’s decision to impose rental restrictions has effectively killed-off the funding market that underpinned both the investment and delivery of Build to Rent projects. As such, Build to Rent projects in Scotland are no longer deliverable for the foreseeable future.
“Please be reassured that whilst we propose to change the Build to Rent parts of the site to PBSA, we do so in order to ensure we can deliver a high quality, residential-led proposal without any significant change to the visual appearance of the development, and are able to maintain the quality of materials and public realm. The only material change is to the use class itself.”
Ediston’s letter to local residents
