TUI Resorts & Hotels, a subsidiary of travel giant TUI Group, has begun construction work on the first phase of the Castelfalfi Resort in Tuscany.

The 250m euro (£221m, US$362m) project will integrate a number of eco-friendly solutions and comprises a 32-bedroom boutique hotel, country houses, restaurants and a golf course.

Two further hotels are to be built in phase two and plans also include the creation of a large living spa for residents as well as resort guests.

TUI purchased the entire Tenuta di Castelfalfi village in the heart of Tuscany in 2007.

Michael Frenzel, CEO of TUI, said: "With this project we are embarking on a new chapter in the history of TUI Hotels & Resorts.

"We are developing an extensive resort which will be unique for the Tuscany region and aspects of sustainability and the preservation and restoration of this unique landscape are our top priorities.

In total, 60 per cent of energy requirements will be generated locally in a local biomass processing power station while the entire water supply will be drawn from the site's own spring.

The environmental management of the resort will be undertaken on the basis of the DIN EN ISO 14001 standard and on the basis of the extended environmental and sustainability standard required for TUI's own "EcoResort" in-house quality seal.

The village's medieval citadel is being converted into a restaurant as part of the first phase and another is planned in an old pizzeria.

The rest of the Borgo is being renovated, creating around 50 units which are to be sold off as holiday properties. In total, 26 derelict farms will be converted into exclusive country houses.