Construction begins on £95m Edinburgh hotel development

Property-development and investment company, MRP has reached a major development milestone at 60 Morrison Street in Edinburgh city centre, confirming a pre-let agreement with Dalata Hotel Group for a new 256-bedroom, four-star Clayton Hotel, securing development funding from AIB and commencing construction of the £95m scheme.

The development will deliver Dalata's second Clayton Hotel in Edinburgh, further strengthening the group's presence in one of the UK's strongest hotel markets. Located adjacent to the Edinburgh International Conference Centre (EICC), the hotel is expected to benefit from strong demand across the corporate, conference and leisure sectors, while representing a significant investment in Edinburgh city centre.

Design and build contractor McAleer & Rushe has now commenced works to transform and extend the existing six-storey office building. The project will see the structure retained and stripped back to its frame before the addition of three new storeys, creating a contemporary nine-storey hotel complete with restaurant, bar, gym and business facilities.

Designed to achieve BREEAM ‘Excellent’ and EPC ‘A’ ratings, the development will combine the environmental benefits of retaining and repurposing an existing building with the delivery of a highly energy-efficient hotel in the heart of Edinburgh.

The scheme builds on the longstanding relationships between MRP, Dalata, McAleer & Rushe and AIB, with all four organisations having worked together on a number of successful developments across the UK and Ireland.

Angus Monteith, development director at MRP, said: "The commencement of construction, alongside the support of Dalata as operator and AIB as funding partner, represents an important step forward for this development.

“Edinburgh continues to demonstrate strong fundamentals as a hotel market, underpinned by a vibrant tourism sector, a growing conference market and a resilient business economy. We have worked successfully with both Dalata and AIB for many years and are pleased to be partnering with them again to deliver a high-quality hotel in one of the city's most sought-after locations."

Mark Diamond, senior director at McAleer & Rushe, said: "We are delighted to have commenced construction at 60 Morrison Street. This project demonstrates how existing buildings can be successfully repurposed to create modern, sustainable developments that meet changing market needs supporting the continued regeneration of city centres."

MRP’s development portfolio has a total end value of around £2bn, of which around £350m is currently under construction. Assets under management are valued at £500m and produce an income of over £20m per annum. MRP is the property division of McAleer & Rushe.

www.mrp.co.uk