PLANS for one of the largest rural regeneration projects on a private Scottish estate have been unveiled, heralding a multi-million pound investment for the island of Bute.

The Mount Stuart Trust announced yesterday that 27,000-acre Bute Estate is to undertake a major programme of work that will transform historic and unused buildings on the island in the Firth of Clyde to offer residential homes and self-catering holiday accommodation.

The three-year initiative is being funded by an investment in excess of £8 million by the estate.

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The trust, which has had its critics in the past, was set up in 1985 by the then Marquess of Bute and is run by the Bute family.

The new dwellings in the development plan will be designed as energy-efficient, environmentally-friendly contemporary homes, but will feature the vernacular architecture "maintaining the heritage and character of the island."

This will involve the use of locally sourced timber cladding and the recycling of original stone and slate wherever possible.

The project will also include the renovation of existing buildings and the creation of hybrid units, combining older structures with new additions.

Where these options are unsuitable, new-build homes will be developed.

Connie Lovel, chief executive of the Mount Stuart Trust, said: "This is a tremendously exciting initiative by Bute Estate and demonstrates our deep commitment to the social, economic and environmental fabric of the island.

"The project will provide homes of a high standard for existing residents and newcomers as well as enhancing self-catering holiday accommodation."

She said the first phase of the project would involve the development of six sites with an additional five sites identified for the second phase, including the Mansion House in Rothesay.

An existing stone byre will be converted to a four-bedroom family home and three new-build homes will form a cluster of dwellings for rent.

A B-listed Georgian house will be restored to provide a self-catering holiday let accommodation for larger groups.

Part of an existing steading will also be complemented by new extensions to provide self-catering holiday lets, while another steading building will be renovated unit for residential let.

Ms Lovel added: "Due to the age and condition of the properties when they return to the estate following lengthy lease periods, there is often a need for significant upgrading and we look forward to making great progress in restoring as many of these properties as possible."

Isobel Strong, SNP councillor for Bute, said: "I think this is great news for Bute. Mount Stuart Trust has been criticised for not putting enough into the island but this represents a large investment in the fabric of many buildings that have seen better days.

"This is a step forward in the regeneration of the rural part of the island and will be welcomed by people in the community, not just for the improvement in the built fabric but also for the jobs which it will generate, as will good quality self-catering accommodation, which will help boost the island's tourist industry."

She said she was pleased to see that the Mansion House, a prominent building in the centre of Rothesay, was to be renovated in the second phase.

Douglas McAdam, chief executive of Scottish Land & Estates, the landowners' organisation, welcomed the announcement. He said: "We have long argued that the focus of any land reform debate on how to increase the viability of our rural communities should focus on making the best use of our assets and resources rather than debates around ownership structures."