File photo of the former hotel scheme.

Select Property Group has today been announced as the new owner of Portland Crescent - the site of the part-build Leeds Arena Hotel - with plans to invest Â£56m to turn the site into 273 “premium student apartments”, under their Vita Student brand.

Subject to planning permission, company bosses say work will begin later this year, alongside their other Vita Student development at St Alban’s Place, which is already under construction.

It follows the revelation, reported in the YEP last week, that a Â£4.8m taxpayer loan to the original hotel project has now been written off.

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The site had been languishing in development limbo for two years, after the original contractor went into administration.

The scheme had been part-funded by the taxpayer loan from the Leeds City Region Enterprise Partnership (LEP) to Oxford GB Two Limited, the hotel development arm of the original contractor.

However in March last year, that company also crashed.

Speaking about the purchase today, Mark Stott, CEO of Select Property Group, said: “For us, finding the right locations for our residences is key and we’ve done just that with Portland Crescent and [second site] St Alban’s Place.”

Councillor Richard Lewis, Leeds City Council’s executive member for regeneration, said: “This is a prime development site at the centre of our civic quarter and our priority is to ensure it is brought back into use.”

Roger Marsh, chairman of the LEP and a member of the West Yorkshire Combined Authority said he was “delighted” to see the development move forward and added: “It’s been a tireless effort by the Combined Authority, the Council and the LEP to bring this strategically important development site back to market and ensure that the initial taxpayer investment in the site would realise the full economic benefits for which it was intended.”

But Coun Andrew Carter, leader of the opposition Conservative group, who has repeatedly questioned whether the taxpayer money will be paid back, told the YEP yesterday: “No amount of window dressing by Roger Marsh can disguise the fact that the taxpayer has lost Â£4.8m.”