Moray councillors this week gave the thumbs up to the South Street proposal to demolish the former Junners toy shop, the Newmarket Bar and the Jailhouse nightclub to make way for a business hub, three retail units plus 38 flats across five blocks and a courtyard.

Under the plans by Robertson Property Limited, the C-listed archway at the entrance to the old Junners store will remain in place.

The development, part of the Elgin City Centre Masterplan, is being supported by the Moray Growth Deal and Levelling Up funding. The regional deal is a long-term plan centred around specific projects designed to transform the economy, address concerns around encouraging young people to live and work in the area and gender inequality in employment.

Plans will see the addition of 38 affordable one and two-bedroom homes, split across three buildings which will surround a central courtyard, allowing connectivity across the site as well as an accessible space for community use.

Designed to promote inclusive economic development in Moray and beyond, the Business Enterprise Hub will support the growth of small and micro-businesses. It is to provide a vibrant, creative environment to inspire existing micro-businesses and SMEs, as well as supporting start-ups, university spin-outs and attracting new businesses and inward investors to the region.

The three-storey Hub will offer pre-incubation space for new and growing businesses with access to meeting rooms, studios, digital equipment and space for research and development, in addition to classroom space, focus rooms and staff facilities.

The vision for South Street was initially revealed in December last year and gathered local support following a public information day. Since then, the design has evolved with the formalisation of planning proposals.

Elgin councillor Sandy Keith said the South Street development would complement the other regeneration work in the town centre.

He said: “This development brings more housing and the transformation of the derelict site.

“It is a lot of investment to improve the town centre. This development’s flats and the Poundland flats will help bring more footfall in the town centre.”

Robertson Group CEO Elliot Robertson said the regeneration of Elgin’s South Street will return economic benefit and life to the town centre.

He said: “As a major employer in Elgin, Robertson is highly invested in making this project a success, for the local and wider economy.

He added: “I am confident that repurposing this part of town will act as a catalyst for wider regeneration and investment.”