City chairman Adam Pearson said: "We're extremely disappointed that Julian is leaving us as he was a big part of our plans for the future.
"However, we understand that his family has to come first and we wish him well."
Meanwhile manager Jan Molby added: "It's come out of the blue really and we weren't expecting to be without Julian next season.
"Obviously there were players we were willing to let go but Julian wasn't one of them and his departure has left a hole in the squad.
"The ironic thing is that we received an enquiry from another club about him back in May but weren't willing to do business because I thought he had a major part to play for the club.
"It's not to be though and the door is now open for a few of the other players to stake their claim as we probably won't replace Julian in the short term."