Terrace Hill and its joint venture with Osborne’s development arm exchanged conditional contracts with Legal & General Property for the forward funding and sale of its 1,104 rooms student development last week.

The planned Mayflower Plaza project is estimated to be worth £70m to build and will see three accommodation blocks from 8-16 storeys tall built for student from the University of Southampton.

Terrace Hill gained planning planning for the scheme back in 2008, but the development stalled in the recession.

The V-shaped site off Commercial Road has stood empty since the 1980s and was demolished in 2003.

Philip Leech, chief executive of Terrace Hill, said: “Our student accommodation development at Mayflower Plaza is an extremely attractive, high quality scheme in a city with a large student population, let to a very strong tenant in the University of Southampton on a long lease.

“These factors underline the institutional quality of the asset, which has allowed us to secure the forward funding and sale of the property to Legal & General Property.”

Gordon Aitchison, Director of Investment and Development at Legal & General Property, said the deal was the third major funding of student accommodation this year.