Allies & Morrison is set to take over design work for Noho Square, the luxury mixed-use scheme in central London initially spearheaded by the Candy brothers.

Current site owner Kaupthing said today it was in negotiations with developer Stanhope to reorganise and develop the prominent site near Oxford Street following the exit, last November, of Christian Candy’s CPC Group and its architect, Make.

The £200 million project, comprising 216 new homes and 33,000sq m of offices, was mothballed last summer.

The news of Allies & Morrison’s involvement – confirmed by a Stanhope spokeswoman – is a huge boost to the architect, which recently made nearly a dozen staff redundant.

In a joint statement, Stanhope and Kaupthing said they had yet to finalise an agreement between them. "If an agreement is reached,” they said, “Stanhope will oversee the development, design and reorganisation of the site with the aim of maximising its value. Should it go ahead, Stanhope will also inject new capital into the project and bear all foreseeable costs.”