The City of Edinburgh Council is looking for a developer to take on a major housing regeneration project set to see 800 new properties being built in the Pennywell and Muirhouse area.

An £80 million contract is up for grabs for any perspective developing firm to help improve the accommodation conditions for areas across Edinburgh. The council is outlining its renewed commitment to ensuring quality housing for resident of the Scottish capital and helping to rejuvenate the poorer areas of the city.

It is part of the authority's 21st Century Homes programme and the Pennywell and Muirhouse development will help to provide half the properties at an affordable price, with the remainder being for sale and rent for businesses in the private sector.

Edinburgh council has stated that any company taking on this contract will have to abide by current planning permission regulations which the authority secured in principal prior to advertising the project to developers. Councillors have already stated that construction is set to begin in 2013 with new homes expected to be ready by 2014.

Mark Turley, director of services for communities, said: "This is an exciting time for the people in Pennywell. The development is a housing led regeneration opportunity which will boost the local economy by providing new jobs in the construction industry as well as supporting local businesses. The development provides the council with the opportunity to unlock private investment, provide a mix of new housing and create a sustainable development for the area."

The 21st Century Homes programme is a £170 million project which is part of the council's overall vision of a regenerated Edinburgh providing housing for people all over the capital. Other parts of the city such as Gracemount, North Sighthill, Leith Fort and Greendykes are also involved in the plans which will see 1,800 new properties being constructed over the next eight years.

In 2008, a report by NHS Lothian, published by the Scotsman, found that the city was subject to a "smoking map" which showed a major gulf between the poorer and more affluent areas of the capital with many in the less well off towns becoming "addicted" to cigarettes.

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