Building work has begun on two new Hjaltland Housing Association (HHA) projects in Lerwick which when complete will accommodate 55 tenants.

Twelve one-bedroom flats are being constructed for 17 people at Fort Road in the same style as the association’s Excelsior Place development next door. And 14 properties are under way at Pegasus Place just off Ladies Drive on North Staney Hill. They will house a total of 38 people.

The developments, a £3.5 million investment by HHA, are part-funded by a £1.25m package from Bank of Scotland, extending the bank’s support to the association to £4.5m, and the Scottish Government.

The Fort Road site, the location of the former Shetland Islands Council housing offices, was gifted to HHA by the local authority.

HHA chief executive Bryan Leask said: “This is yet another example of us working in close partnership with the local authority to provide homes to meet the high level of demand in Shetland.

“There are currently 360 people on the housing list for Lerwick and the Fort Road and Pegasus Place developments will make a substantial contribution to reducing those numbers.”

Douglas Spowart, SME banking, property team relationship director at Bank of Scotland, added: “It is fantastic to see Hjaltland Housing Association, currently viewed as one of Scotland’s most proactive developers of social housing, mark its 40th year with new homes to support 55 more people in need of social accommodation in Shetland, and is testament to the Association’s commitment to the local community and the wider regeneration of the area.

“To this end we felt it was extremely important to extend our backing, as part of our 25 year relationship with HHA, which will result in more local families in need benefiting from the stability and comfort of this quality housing.”

Designed by Dougie Thomson of Gilberts Architects, the £1.5m Fort Road development, to be named Lyndhurst Place after the original house which formed part of the Excelsior/Moonies Wake bar and nightclub, is being built by Hunter & Morrison.

The flats will be constructed with structural steel, blockwork and concrete floors for soundproofing and fire protection. They will be connected to the district heating scheme as well as having mechanical ventilation with heat recovery systems installed.

Low maintenance materials, e.g. natural slates, larch boarding and Aluclad windows are being used.

The £1.9m Pegasus Place scheme, to be named Wista (unsheltered, windswept place), will comprise eight two-person flats, four three-person semi-detached houses and two five-person semi-detached houses.

They have been designed by Redman + Sutherland and are being built by E&H Building Contractors.

The homes will be timber clad with enhanced insulation. They will be heated by air source heat pumps to reduce heating costs.

For both developments the engineer is Arch Henderson, while Michael Thomson is the quantity surveyor and the CDM co-ordinator is the John Duguid Partnership.

Both developments are scheduled for completion in September 2016.