THE first phase of a new £1 million office refurbishment in York city centre has been completed with the first tenants moving in next month.

Property Alliance Group has been redeveloping 8,800 sq ft of the Grade II listed building in George Hudson Street, which used to be the home of City of York Council.

The company had originally planned to create a £6 million, 53-bedroomed hotel in the building, but withdrew its plans following opposition from the council.

Now, following completion of the first phase of an office development, planning, design and management services business CH2M HILL will be relocating from its current Lendal premises into the new office space in April, moving up to 90 employees.

Work will then start on the second phase of the refurbishment with 9,500 sq ft to be renovated.

All of the building’s original, period features are being restored, including the solid wood parquet floors, exposed beams and glazed brickwork.

Ian Hunter, director at Property Alliance Group said: “We know that there is a lack of good quality, Grade A office space in York and this development will help fill that need.

"We’ve made a major investment in this property to ensure that tenants benefit from a very high-quality working environment that reflects the history of the building and oozes character.”

Miles Lawrence, director at agent Lawrence Hannah, which is marketing the office accommodation, added: “The new interior at 20 George Hudson Street genuinely sets it apart from other office buildings in York.

“We have had significant interest already, particularly from those operating in the rail sector and expect the remaining space to be filled quickly.”

Property Alliance Group withdrew its plans for the hotel in December last year.

When the hotel plans originally emerged, the company 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 into offices will renovate some of the building’s original features, including a terrazzo tile staircase and parquet floors, and the work will include a new entrance foyer, toilets and showers, skylights and lifts.