The Scottish Government is providing a £7.9 million loan towards building hundreds of new homes in Aberdeen.

The funding has been allocated to the Grandhome Trust which will deliver more than 600 homes in the city.

The loan is part of a £50m Housing Infrastructure Fund for 2016/17, which helps to unlock strategically important housing sites across Scotland.

Overall, the development forms the first phase of the site at Grandhome which has planning permission in principle for a community of 4,700 homes, including commercial, retail, leisure, and public space.

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Aberdeen City Council has already had its Affordable Housing Programme allocation increased to £10.9m this year – a 70% increase from 2015.

Housing Minister Kevin Stewart, who visited Grandhome to see the start of construction today, said: "I am really pleased the first loan from this important Scottish Government fund is being used to unlock a key housing site. The first phase of 600 homes will include at least 90 affordable homes.

"Today's announcement underlines this Government's determination to increase the pace and scale of development to deliver more homes. I look forward to further loans and grants being granted to projects across Scotland."

Bruce Smith, a trustee of The Grandhome Trust, added: "The new community of Grandhome has been more than 10 years in the planning and the delivery of the first phase of enabling infrastructure, supported by the Scottish Government's loan, is an important milestone for us.

"Grandhome will meet a large proportion of the city's future housing needs and be a community that sets new standards for place making in Aberdeen."

(LM/JP)