City of Edinburgh councillors have voted to protect a site earmarked for student accommodation, after local residents feared the development would "change the nature of the community".
Proposals to build a 191-bed block at Jock's Lodge - which attracted more than 1,000 objections - were thrown out following a three-hour hearing at the City Chambers, where locals, councillors and applicants made their case.
Campaigners staged a rally outside before the meeting kicked off on Wednesday morning and said afterwards they "had won the battle but not the war", as an appeal to the Scottish Government was now anticipated.
However, a local councillor said developers "sound like they might be open to having a proper open and constructive dialogue with the local community".
The plan, which involved demolishing six "run down" commercial units - half of which are currently empty - was refused due to the height of the proposed seven-storey building and impact on the the area, among other concerns that the application did not comply with several planning rules.
The decision, backed by seven councillors to four, came despite developers winning the support of council planners.
Applicants and local business owners argued that traders were struggling to survive in the area, which was in need of "major modernisation".
The two bars on the site, Limelite and The Willow, plus Chennai's Marina takeaway, would be knocked down under the proposals, however Limelite's owners were offered an opportunity to move into a new bar and restaurant on the ground floor of the new development once it was built.
"There are currently six commercial units on site and they would be replaced by one - but the one that is replacing the existing is considerably larger in floor space," read the planning proposal. "It takes up the space of three of those units, so there's a net loss in the number of units, but in terms of actual commercial frontage floorspace about half the space is lost."
Jock's Lodge was once home to a coaching inn as it was the first place to change horses on the Edinburgh to London stagecoach, and a report said the area "is recognised as a local landmark in Edinburgh's historic landscape".
The city council's archaeologist said the "complete demolition of the buildings as proposed would be regarded as having a significant archaeological and historic impact".
Shane Donnellan, from the Save Jock's Lodge campaign, said the block would "overwhelm the junction", due to its height.
Another representative from the group, Kirsty Pattison, highlighted to the meeting plans to build nearly 700 new homes nearby at Meadowbank, adding: "Given the number of new residents at the Meadowbank Development, as well as St Margaret's House which is an other student accommodation, we believe that the destruction of these individual retail units will have a lasting and detrimental impact on the attractiveness of the area for future generations."
Taking the opposite view, Limelite's landlord Andy Currie expressed his "wholehearted support" for the application.
He said: "I know it will change our community, I know there are mixed views across our area, but I also know our area and our current venue must change - and without that change Limelite will find it increasingly difficult to survive.
"Our community is changing and we need to change to meet local demands."
Samantha Robertson, who owns a waxing salon at Jock's Lodge, said: "I've ran my businesses in the area for 15 years and have seen many changes and many businesses come and go in the dilapidated buildings."
She welcomed the plans for a "beautiful, brand new building", adding: "Given the current housing crisis and many students not able to find accommodation, this is a very necessary and needed development."
Agent for the developers Colin Lavety said: "The proposal not only represents a chance to contribute towards unmet need for student accommodation, but also to redevelop an undefined corner, providing a highly sustainable and well-designed development."
Architect Paul Stallan also argued that the current arrangement of buildings was a "layer cake of historical development", noting that the "unapologetically modern" student block would bring a "stylish and popular destination" to a street which was "not in a good shape".
However, none of the three local councillors for Craigentinny and Duddingston who attended the meeting offered their support for the application.
Conservatives councillor Iain Whyte said many residents living in the area had been in touch with fears the "nature of the community" would be changed.
"I think the local community view, as expressed to me very directly, is that this probably isn't the right site for student accommodation," he said.
SNP councillor Danny Aston said there was "no basis" to support claims the existing units were not fit for purpose.
He said: "The bottom line is that there are two pubs on the site now, there would be one, both pubs are very different, both are doing very well.
"In the place of six commercial units - including the two pubs - there will only be the one pub and the common room of the student accommodation which doens't contribute to the local area.
"We're talking about losing more than a third of the commercial floorspace."
The Greens' Alex Staniforth said: "If we create a very tall, imposing building on another corner here it takes away that openness of this junction, so it destroys the character of the junction at Jock's Lodge.
"It does not represent the character of this junction."
Committee members agreed the application was "finely balanced" and that strong arguments were made on either side.
But convener Hal Osler, of the Liberal Democrats, said that on balance it should be refused due to some "major concerns".
Tim Jones, one of the four councillors who voted to grant planning permission, said the proposals had been "well thought out", adding: "I do think that this is an improvement on what is here and I would say that I've passed the site on a regular basis every day almost and the business units are dilapidated - it's been like that for a long time."
Aston said after the meeting that developers "sound like they might be open to having a proper open and constructive dialogue with the local community on this, rather than rushing straight to appeal, to reach a positive and collaborative future for Jock’s Lodge that benefits people who live in the area", adding: "If that is the case, I very much welcome that and look forward to seeing what happens next.”
Jim Sneddon from Save Jock's Lodge said: "I thought the arguments on both side were very good.
"I say we've won the battle, but not the war, because obviously it could be taken to appeal to the reporter at the Scottish Parliament.
"Or maybe there's room for some exchange with the developer, the developer's not wrong - the site is running down and work could be done to it - I came here sceptical today but I think we did see democracy in action."
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