St James Centre in Edinburgh: New mall 'will not create' shopping war
Developers deny the creation of the St James Quarter in Edinburgh city centre will fuel a shopping war between the capital and Glasgow.
The £850m St James Quarter has secured a new form of public private partnership.
The Regeneration Accelerator Model combines local and national government funding with private investment in local infrastructure and public space.
This can then be offset by business rates.
More than £60m is being invested by the taxpayer, through the new Regeneration Accelerator Model.
Developers TH Real Estate said it will put Edinburgh in the top five UK cities for shopping but they hope it will complement rather than compete with Glasgow for business.
The new commercial, retail and residential district is forecast to support more than 2,000 jobs.
It will link Princes Street to Multrees Walk in a series of crescents with theatres to training academies, as well as offices, flats, restaurants and shops.
It is also to bring £25m a year to the Scottish economy.
Deputy First Minister Nicola Sturgeon said: "Today's announcement will transform this area of the capital, creating thousands of jobs and boosting the Scottish economy.
"This has only been possible due to an innovative funding model, which will see the Scottish Government work in partnership with City of Edinburgh Council and private developers TIAA Henderson Real Estate.
"This government is determined to invest in Scotland's infrastructure - both to stimulate growth in the short term and lay the foundations for long term success.
"Through schemes such as RAM we are increasing public investment in infrastructure across Scotland, which will create overall gains for the economy as a whole."
The existing St James Centre will continue to trade until construction work begins.
Construction work is expected to start in 2015.