Ministers demand public inquiry into Haymarket hotel plans

PLANS for a towering new hotel at Haymarket are facing severe delays and could be scrapped altogether after a public inquiry was ordered into the scheme.

The £200 million project, which includes the contentious 17-storey five-star hotel, has already received the go-ahead from the council's planning committee.

But Scottish Government ministers have called for the inquiry, which developers fear could cause months of delays.

John Nesbitt, managing director of Tiger Developments, said: "We are naturally disappointed that we will now have to face a further delay in starting a project which won planning approval and secured much public support at a local level.

"The Haymarket development area remains one of Edinburgh's most neglected city-centre sites. Following the planning approval in the summer, we were looking forward to quickly moving on site and starting the £200 million transformation.

"We remain, however, 100 per cent committed to developing the site and still look forward to the opportunity of leading one of Edinburgh's most exciting regeneration projects."

Final approval from the Scottish Government was required because the council has a financial interest in the land. But planning minister Stewart Stevenson will not simply rubber stamp the development and ministers have instead called for the inquiry.

A government spokesman said: "In view of the nature of this proposal and its possible implications, Scottish ministers have decided that the matter should be considered at a public local inquiry."

Under current proposals, the car park at the former Morrison Street goods yard would be replaced by a 192-bedroom, five-star hotel, a neighbouring three-star, 245-bedroom Travelodge, 342sq ft of office space, shops, cafes and restaurants.

A city council spokeswoman said: "We await, with interest, the details of the ministers' direction and will co-operate fully with the process."

Some politicians have described the flagship building as "world-class", claiming it will enhance Edinburgh's skyline.

But the "leaf-shaped" hotel centrepiece has been described as looking like "an alien spaceship dropped in from Doctor Who".

Alternative plans for the site, drawn up by EDI, the arms-length council-owned company, were described as "unimaginative and almost brutal".

Despite fierce criticism, the plans were granted planning permission, which was approved by Scottish Executive ministers in 2006 following a public inquiry.

But EDI was forced to put the site on the market because of the council's decision to use the firm's assets to help finance a massive equal pay settlement.

Irish developer Tiger bought the site in December 2006 for a sum believed to be £41.5m.