Newport Street Gallery – Caruso St John Architects’ conversion of almost an entire street of listed industrial buildings in south London into a free public gallery for artist Damien Hirst’s private art collection – has won the 2016 RIBA Stirling Prize for the UK’s best new building.

The presentation of the prestigious trophy took place at a special ceremony on Thursday evening (6 October) at the headquarters of the Royal Institute of British Architects in central London.

Newport Street Gallery is formed from three Victorian industrial buildings, which were formerly carpentry and scenery painting workshops for West End theatres. These were remodelled by Caruso St John and flanked at either end by entirely new pale red buildings, including one with a spiky saw-tooth roof.

The ground and upper floors within the interconnected five buildings are continuous, with new spiral staircases on their side, to create flexible spaces able to accommodate everything from individual works to larger shows.

“This gallery has realised my ambition to create an unobtrusive and beautiful series of buildings that work perfectly as a space to exhibit great art,” said Hirst, commenting on the Stirling win. “I wanted to stay true to the history and roots of the building and Caruso St John understood that from the start.

“I am immensely proud of what we achieved and the reaction it has received in its first year of opening and hope people will continue to enjoy it.”

The Newport building was selected ahead of five other shortlisted schemes, including one other leisure project – WilkinsonEyre’s Weston Library in Oxford.

The other contenders were a partly-subterranean home in the Forest of Dean by Loyn & Co, called the Outhouse; the Blavatnik School of Government in Oxford by Herzog & de Meuron; the Trafalgar Place housing development in south London by dRMM Architects; and a new college campus for the City of Glasgow College by Michael Laird Architects & Reiach and Hall Architects.

In their citation for the winner, the Stirling judges said: “This highly accomplished and expertly detailed art gallery is a bold and confident contribution to the best of UK architecture. Caruso St John’s approach to conservation is irreverent yet sensitive and achieves a clever solution that expresses a poetic juxtaposition of old and new.

“The collection of buildings is beautifully curated, pulled together by the use of brick yet still expressive of their individuality. The playful use of LED technology [on an exterior welcome sign] gives a contemporary addition to the façade.

“The gallery, which is free of charge, is a generous asset to an evolving community.”

This is the first time Caruso St John architects have won the RIBA Stirling Prize. They were previously shortlisted for the award for Brick House, west London in 2006 and New Art Gallery Walsall in 2000.

Studio partner Peter St John said: “It's rare for architects to be given the opportunity to realise a personal vision of the quality of the Newport Street Gallery, and for that vision to have a generous public dimension. We see the building as a palace for direct, intimate and luxurious encounters with contemporary art, and we are very pleased that this award will bring more people to see this extraordinary collection.”

The Stirling jury, chaired by Zaha Hadid Architects’ director Patrik Schumacher, included artist Rachel Whiteread, AHMM director Paul Monagham and Heneghan Peng co-founder Roisin Heneghan.

The prize was judged on a range of criteria, including design vision, innovation and originality; capacity to stimulate, engage and delight occupants and visitors; accessibility and sustainability; and the level of client satisfaction.

Previous leisure winners include the Liverpool Everyman Theatre by Haworth Tompkins (2013); Astley Castle by Witherford Watson Mann (2012); MAXXI Museum, Rome by Zaha Hadid Architects (2009, before the prize was restricted to UK projects); and The German Museum of Modern Literature, Marbach am Neckar, by David Chipperfield Architects (2006).