CAMPAIGNERS claimed a victory for the community yesterday as the Scottish Government knocked back a developer’s student flats plans.

Ministers ruled Drum Property Group cannot raze a row of sandstone shops in Leith to fulfil its £50 million hotel and student flats scheme.

Developers were told there is “no acceptable” proposal to justify the loss of the 1920s structure after more than 12,000 people signed a petition insisting it must be saved.

A spokesperson for the Save Leith Walk group – which argued losing the row would damage the area’s character – responded: “Today’s decision shows what can be done when a community organises and unites behind a common message.”

City of Edinburgh Council had already ruled against the Stead’s Place planning application.

But Drum Property Group appealed that decision and yesterday it said it was “disappointed” by the second refusal.

A spokesperson said: “We shall now review the reporter’s detailed findings before considering our position in the new year.”

The developer had hoped to create more than 470 student flats, a near-60 bedroom hotel and more than 50 affordable homes on the shop row site, which stretches across three acres.

The capital has some of Scotland’s highest housing costs.

The big-money blueprint initially had the support of Edinburgh University, but the institution withdrew its backing after the council rejection earlier this year.

In her decision, Scottish Government planning reporter Karen Black said: “I concluded planning permission should be refused as the replacement buildings would not preserve or enhance the character and appearance of the conservation area, in contravention of the relevant statutory tests and development plan policies.

“It follows that there is currently no acceptable redevelopment proposal that might justify demolition.”

Local MSP Ben Macpherson welcomed the decision, but said it was “very disappointing” that Drum Property Group had evicted “several good businesses over the last year” for a development that will not now happen.

He stated: “I’m absolutely delighted for the community that the Scottish Government’s reporter has decided to uphold the decision. Today Leith has been heard.

“I’m very proud that together we’ve achieved this positive result for the community and preserving Leith’s heritage.”

A Save Leith Walk spokesperson said the decision shows the development plan was “completely out of step with community needs for housing, local businesses and retaining our heritage”.

A statement said: “It is easy to give up hope when you are faced with a challenge that looks insurmountable, but when community groups get the right combination of people together, they can be heard at the highest level. We hope that our campaign gives strength and hope to people across Scotland facing unwanted developments in their areas.”