Landowners in south Armagh have been informed by letter that land requisitioned by the British army more than 30 years ago is to be returned to them. The police had also been trying to buy a section of the Crossmaglen land to build a police station but this plan has been abandoned.
Chief Superintendent Bobby Hunniford said the police service had written to the landowners offering them "the opportunity to sell the land to the police service at full market value".
"Following that process we considered how much land we actually needed to make the site viable for a proper purpose-built station and have now written to some of the individuals and advised that we will not be seeking to acquire their land when the requisition order runs out and indeed their land will be returned to them," he said.
Nationalist and republican politicians have welcomed the announcement.
SDLP assembly member Dominic Bradley said police had responded to the community's concerns and reached a solution which was "mutually acceptable to all concerned".
Sinn Féin MP Conor Murphy said the British government had been forced into a U-turn but that landowners "should not have been placed in this situation in the first place."
Mr Hunniford said that "within the next few months" the helipad in Crossmaglen would no longer be used.