Tesco Bank is proposing to leave its Edinburgh HQ next year, and Edinburgh Napier University is reportedly looking at the site as a possible replacement for its Merchiston campus.
A month ago, the university confirmed plans to vacate the decades-old campus because of a tightening budget and a looming £220m repair bill.
Now, multiple sources say that lecturers have been verbally briefed that Napier is eyeing the Tesco Bank offices in South Gyle, in the west of the city, which are set to be vacated next year.
A spokesperson for Tesco Bank – now owned by Barclays – confirmed the firm is planning to exit its sub-lease on the building at South Gyle Crescent next year, but will retain an office in Edinburgh.
A spokesperson from Edinburgh Napier University did not deny the reports, but said the university – which has just under 14,000 students enrolled across its three campuses – will not comment on “specifics”.
The university instead chose to reiterate its previous statement: “We continue to provide life-changing teaching for students alongside leading research and innovation.
“Our Merchiston campus is no longer fit for the future, and we want to provide enhanced facilities going forward. We are therefore now considering alternative options elsewhere, and this process is in its early stages.
“Like many institutions across the sector, Edinburgh Napier will adapt to a continually uncertain environment and acute funding pressures from the Scottish Government.
“We will continue to work with our staff, students and the wider community as we shape the University in the years to come.”
Prior to the announcement last month, an email sent to staff said the institution had identified a suitable replacement site “in the Gyle area of the city”.
Merchiston Campus is thought to be affected by Reinforced Autoclaved Aerated Concrete (RAAC) – a lightweight, “bubbly” construction material prone to catastrophic failure when exposed to moisture – which has driven remediation costs sky-high.
Rather than foot the expensive £220 million bill, the university has opted to sell up, and can expect to recoup a healthy fee for the large building, which sits at the crossroads of the trendy Edinburgh neighbourhoods of Bruntsfield, Morningside, and Merchiston near the city centre.
Simultaneously with the announcement of intention to sell Merchiston, Napier detailed plans for a “strategic alliance” with Queen Margaret University (QMU) and Scotland’s Rural College (SRUC).
Napier says this partnership will allow the university to build on “strong regional partnerships” to foster “cooperative growth and improve resilience”.
This, along with plans to consolidate its five schools into just three, is part of a broader restructuring of the university aimed at streamlining its operation amid a “continually uncertain environment and acute funding pressures from The Scottish Government”.
The university has assured that there will be no reduction in staff numbers as a result of this restructuring.
The building is owned by Tesco plc, and leased to Tesco Bank, which is now an imprint of Barclays, following its £600m purchase of the bank in 2024.
It is unclear at this stage if Napier plans to similarly lease the building from Tesco or purchase it outright.
Developments at Napier and QMU come amid mounting concerns about funding for higher education in Scotland.
Bosses at The University of Edinburgh are locked in a bitter struggle with staff over their plans to cut expenditure at the university by £140m.
Waves of strikes and a marking and assessment boycott have followed the university’s attempts to force through hundreds of voluntary and compulsory redundancies.
Dundee University was bailed out to the tune of £62m by the Scottish Government after an enormous funding black hole was revealed last year.
Although Napier has been better off than many institutions, the university responded to this “increasingly challenging environment” by cutting around 70 jobs since August last year.
This led to walkouts and protests in front of the Scottish Parliament.
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