BAKERY chain Greggs is to build a £13m factory to help it meet demand.

The 57,000sq ft plant will be built at Balliol Park, Longbenton, North Tyneside, close to its 100,000sq ft factory, which opened in 1998.

It will create 50 jobs and boost production of sausage rolls and pies from four million a year to six million, as well as guaranteeing 200 jobs at the existing Longbenton plant.

Greggs had been looking at several sites across the UK for its new savoury facility, but decided on Longbenton after regional development agency One NorthEast offered a £250,000 Selective Finance for Investment grant.

Group production director Nigel Oldham said: "With our shops situated all over the country, we were looking at whether to base the factory in the Midlands or the South.

"We have a fantastic workforce in the North-East and are proud of our roots here.

"But distribution costs were making the decision difficult. The support from One NorthEast helped to swing the decision."

But he warned that future expansion would require another plant further south.

The expansion is to support growth plans that aim to increase the number of Greggs shops from 1,250 to 1,700 over the next five years. The group also owns the Bakers Oven chain.

Construction on the savoury facility will start this year, and it is expected to go into production next year.

Greggs is planning to open about 50 stores next year, including at least four in the North-East.