Manchester City Council's has approved the redevelopment strategy for the Ramada Renaissance hotel in Deansgate, as part of plans to regenerate the City Centre North Area.

The project led by Manchester-based developers West Properties, which bought the Ramada hotel from Quintain Estates earlier this year, will see the existing two-acre area - dominated by the 1970s hotel - demolished and rebuilt to better complement the cathedral and medieval core. Despite much of the area being redeveloped after the 1996 IRA bombing, the Ramada complex has remained largely unchanged.

The proposed development includes a 250-room hotel with restaurants, bars, a health club and ballroom; 80,000sq ft of retail space and restaurants; 280,000 sq ft of office space and 250 residential apartments. The project will yield over 50 per cent of new public space, as well as two new streets and an urban square at the corner of Deansgate and Blackfriars.

There will also be a series of pedestrian terraces with restaurants and a new public space along the River Irwell to better link the site with the Victoria and Blackfriars bridges.

It is estimated that the redevelopment will generate £90m in additional revenue for the local economy and around 3,000 jobs over the next 10 years.

Manchester City Council leader Sir Richard Leese said: "The Ramada Complex represents one of the most exciting redevelopment opportunities in the city centre.

"It is the final piece of the vision established to guide the redevelopment of the area of the city damaged by the 1996 bombing to be realised."

West Properties plan to submit a planning application for the project before the end of the year.

The council is currently undergoing a study, jointly commissioned by Salford City Council, to co-ordinate future developments in the north area of the city centre, to capitalise on the city's expanding boundaries and to attract new investment opportunities.