Duddingston House Properties and Urbanist Hotels had their revised plans for a 127-room redevelopment of the Thomas Hamilton-designed building knocked back by the Scottish Government last month following a public inquiry.

Government reporters Scott Ferrie and Dannie Onn said the proposals would have had adverse effects on the historic environment.

With an exclusive lease agreement between the City of Edinburgh Council and Urbanist Group for the site understood to expire at some point in 2022, it appears a third attempt is in the offering.

Taco van Heusden, co-founder of Urbanist Hotels, wrote on Twitter: “We will put forward a more modest arts hotel proposal that fits the now established parameters.”

A rival vision by Richard Murphy Architects and Simpson & Brown to turn the property into a music school has been approved but cannot proceed until the agreement between the council and Urbanist Group expires.

Mr van Heusden also claimed that while his hotel proposal was rejected on the grounds of the impact of the two “wings” on either side of the existing building, the proposed music school project would involve the “careless destruction of internal fabric” of the historic site.