A £200m mixed-use development in a historic area of Newcastle-upon-Tyne has been approved by the city council.

The scheme, called Stephenson Quarter, will form part of the council's on-going regeneration of the city's west end. Developers Silverlink Holdings is leading the project, which boasts a four-star 250-bed Crown Plaza Hotel – to be operated by Intercontinential Hotel Group – and a smaller boutique-style hotel, three public squares and an art gallery space.

The 10-acre site, located in the city's Central Conservation District, will also contain 155 flats, a new post office sorting facility, shops and restaurants. When completed, there will be eight new buildings and five refurbished listed properties, which are currently disused and dilapidated. Newcastle-based architects Waring and Netts are the lead designers on the project, working in collaboration with Edinburgh-based Malcolm Fraser Architects, consultants Desco, landscape designers Southern Green and urban design company Syntax.

David Slater, Newcastle City Council's executive director of environment and regeneration, said: "This is one of the biggest and most detailed applications we have ever received. "It will revive a neglected area of the city to bring jobs, home, hotels and history to life."

Silverlink acquired the site in 2005 and has been working closely with the city council for the last four years to create the development's masterplan. According to the council, construction work is expected to begin in 2010 and should be completed by 2015.