A £6 MILLION hotel scheme in the centre of York has been abandoned, and the building will remain as offices instead.

Plans by the Property Alliance Group to turn the former City of York Council offices in George Hudson Street into a 53-bedroom Euro Hostel were withdrawn last month, and the company has confirmed they will not be resubmitted.

It will now work to refurbish the building into 18,500sq ft of office space, and work has already started.

The first tenant will be the planning, design and management services business CH2M HILL, which will move from its current Lendal premises in spring and have between 60 and 90 staff at its new home.

When the hotel plans emerged, Property Alliance Group said the site had been marketed as office space for some time with limited interest, and said the Euro Hostel would create about 60 jobs.

However, the council’s economic development unit opposed the scheme, saying a lack of office space in the centre of York could mean expanding businesses having to move out of the city.

The refurbishment will renovate some of the building’s original features, including a terrazzo tile staircase, parquet floors and glazed brickwork, and the work will include a new entrance foyer, toilets and showers, skylights and lifts.

Jilly Hersey, CH2M HILL’s European facilities operations manager, said: “It is an ideal location, close to our clients and near the railway station, providing colleagues with different modes of transport to get to and from work.

“The property is also full of character with a unique interior and historic feel, and one our staff will enjoy working in. We are looking forward to seeing the refurbishment progress and moving in.”

Property Alliance Group director Ian Hunter said the refurbishment would “meet the requirement for high-quality, Grade-A office space in York.”

He said the renovations had revealed a number of period features, many of which were hidden behind suspended ceilings, plaster and carpets.