The City of Edinburgh Council has approved planning permission for the new Royal Hospital for Sick Children and Department of Clinical Neurosciences.

The project will see services from the Royal Hospital for Sick Children, the Department of Clinical Neurosciences, currently based at the Western General Hospital, and the Child and Adolescent Mental Health Service from the Royal Edinburgh Hospital, brought together in a high quality, modern and fit-for-purpose facility.

The new facility will be built on the site of car park B at the Royal Infirmary of Edinburgh. There will be a physical link between the new facility and the Royal Infirmary of Edinburgh at ground and first floor levels.  The links will ensure clinical functionality and efficiencies, particularly between the emergency departments, theatres and critical care departments on site.

The project was awarded to Integrated Health Solutions Lothian consortium, on 6 March 2014. The Integrated Health Solutions Lothian consortium includes Brookfield Multiplex as the main contractor, Bouygues as facilities management provider and HLMAD as architects, with financial partner Macquarie Capital Group.

Construction work is expected to start later this year, with the hospital becoming operational in the summer of 2017.

The project will be developed on a design, build, finance and maintain (DBFM) basis. The contract is for a period of 28 years.

The total project investment is estimated at £150 million (US$248 million).

This announcement marks another major milestone in this exciting project. The development will prove significant in shaping the future of care by bringing children's, maternity and adult services together on the same site. It will build on the existing centre of excellence, creating a major trauma centre and providing opportunities for sharing experience, expertise and research.

John Ballantyne, Bid Director, Integrated Health Solutions Lothian commented:

Integrated Health Solutions Lothian are delighted to be part of the delivery team for this exciting development where we will design, build, finance and maintain the new Royal Hospital for Sick Children and Department of Clinical Neurosciences. We look forward to working together with NHS Lothian to deliver this major healthcare facility.

Work on the new hospital is anticipated to start by the end of the year once Financial Close is achieved and the Scottish Government approve the Full Business Case for the project.

The project is the first acute hospital facility to be procured under the Scottish Government's Non Profit Distributing model (NPD).  The NPD model is an alternative to the traditional Private Finance Initiative (PFI) model in Scotland.