An Edinburgh city centre site, which has lain vacant for a number of years, is set for major regeneration, creating a landmark development and breathing new life into a neglected part of the Grassmarket.

The proposed redevelopment of the buildings on King’s Stables Road will be taken forward by a joint venture between Peveril Securities - the development arm of the Bowmer and Kirkland Group - and Campus Development Management, who have agreed to buy the site from the City of Edinburgh Council.

The sale is still to be ratified by the council’s finance and resources committee on March 19th.

The current mix of buildings on the site - formerly council offices, storage premises and workshops - have lain vacant since 2009 and were put on the market last year by the council, who deemed them surplus to requirements.

The proposed major mixed-use development will replace the current buildings and include a hotel, one and two bedroom flats, student accommodation, an arts café complex and artisans’ workshops.

The development, with its arts café complex and artisan workshops, will complement the council’s wider aspirations for a new cultural quarter on the site of Argyle House and the linking of Castle Terrace with the Grassmarket and West Port.

King’s Stables Road has been identified by the council as one of 12 “priority” development sites seen as crucial to the capital’s economic future.

Peveril Securities is currently active in the capital, working with Standard Life on a development in St Andrew Square to deliver office, retail and residential. This is due to be completed in June 2016.

The developer will engage on a period of extensive community consultation on proposals for King’s Stables Road, ensuring the local community are well aware of and can play a part in shaping the proposals.

Knight Frank has been acting as advisers on the purchase of the site.

Ralph Jones, head of development at Peveril, said: “These exciting proposals will breathe life into a corner of the Grassmarket that has lain neglected for a number of years, providing a hotel, student accommodation, flats and facilities to accommodate and promote the arts.

“It will also provide a great link between the Grassmarket and Exchange business districts, bringing a vibrant mix of uses to the area and form part of the council’s aspirations for a new cultural quarter.

“We are highly sensitive to the fact that the site is within the UNESCO World Heritage site boundary and as we work our way through the planning process look forward to meeting with the local community, updating them on our proposals and listening to their feedback.”

Cllr Frank Ross, convener of the economy committee, added: “This development forms part of the Edinburgh 12, key strategic sites across the city that the council identified as crucial to delivering transformational change for Edinburgh’s economy and with the potential to deliver up to 20,000 jobs. This is great news for the city and testament to Edinburgh being such an attractive place for inward investment.”