Developers have withdrawn plans to rebuild a historic north-east hospital claiming the project is currently unprofitable.
Last year, a major fire ripped through the former Glen O’Dee Hospital site in Corsee Road, Banchory, drastically setting back plans for its redevelopment.
Forbes Homes, which owns the site, had planned to build 36 flats and 10 houses on the land, but the blaze forced the company back to the drawing board.
The latest planning application was made to Aberdeenshire Council in March, but it has now been withdrawn.
Acting for Forbes Homes, planning agents Ryden told the council they were still in the process of negotiating provision for an emergency access route, which was taking longer than anticipated.
The council said it was reluctant to extend the planning application decision deadline and that led to the application withdrawal.
Forbes Homes’ managing director Derek Forbes said: “At the moment the project is unviable because of the state of the property market.
“It has cost £2.5 million to clean the site up, including £25,000 alone to remove the asbestos.”
He added: “The estimated value of the houses has fallen recently from £1.2 million to £570,000 and we can only press ahead if it’s profitable.
“We want the finished site to look as good as it can be and we need to look at a design that will achieve that, but it is hard to say how long that may take.”
Sixteen people had formally objected to the application before it was withdrawn.