Unit test runner failed to run tests

I don't seem to be able to run (xunit) unit tests by right clicking on these in Visual Studio Community 2015 Update 3 and selecting "Run". Whenever I do this I see a dialog:

Unit test runner failed to run tests

Unable to run xUnit tests - File not found: c:\code\Foo.Tests\bin\Foo.Tests.dll

Parameter name: assemblyFileName

It looks like it's trying to run the tests from the wrong path.

Attempted:

c:\code\Foo.Tests\bin\Foo.Tests.dll

Expected:

c:\code\Foo.Tests\bin\Debug\netcoreapp1.0\Foo.Tests.dll

Is this a known problem? I actually tried NUnit, MSTest and xUnit... all with the same results - so it doesn't appear to the test framework. 

I can run the test from the Test Explorer.

Cheers,

James