Manchester-based developer Urban Waterside has started work on the £6m redevelopment of a former paper mill site in Newcastle-under-Lyme, Staffordshire.

The scheme includes the construction of a new 82-room Travelodge hotel and a Lidl food store, which are expected to create dozens of new jobs for the town and are scheduled to be completed in May 2010. Howard Hagan, managing director of Urban Waterside, said: "The development will employ more than 200 people at various times during the course of construction with as many as 50 new permanent jobs.

"This first phase of development will act as a catalyst for further investment and there will be significant benefits to the local economy which must not be underestimated." Newcastle-under-Lyme Borough Council deputy leader, Robin Studd, added: "The redevelopment of this prominent site is a highly visible statement of confidence in the town and this can only help to encourage further investment."