WORK has already started on the realisation of a £500m dream to transform 250 acres of derelict North-East waterfront into an international architectural icon.

About £10m is being spent opening up the Middlehaven deserted dockland site in Middlesbrough.

Work is also starting on a £5m three-storey office block. A supermarket is expected to follow.

Sean Egan, project manager of Tees Valley Regeneration, which is leading the redevelopment, said: "Devel opers are now picking up the phone to ring us. We will have a number of announcements to come in the next few months."

He said: "It's happening now, it's not just a vision. It's exciting. It's deliverable.''

Referring to a master plan drawn up by award-winning architect Will Alsop, Middlesbrough Mayor Ray Mallon said the result of the scheme would be a "designer-label town".

He told an audience at the public launch of the plans: "I want Middlehaven to kick start the economy of Middlesbrough. Middlehaven is the bedrock on which the future of our town will depend.

"The scale of our ambition sends an important message out to entrepreneurs and developers - that Middlesbrough is open for business."

The project should create more than 3,000 jobs for Middlesbrough, where Mr Mallon conceded "unemployment is a problem".

Mayor Mallon said: "We need a strategic focus and it cannot afford to be blunt."

More than 2,400 houses, 80,000sq ft of commercial development and 500,000sq ft of leisure use will be built over 20 years. There will be a primary school and a fresh site for Middlesbrough College.

It will include a commercial development in the shape of Marge Simpson's pillar hairstyle, a champagne glass- shaped hotel and a theatre resembling an electric toaster.

Mr Alsop said: "The important thing is it will be very different. This is the strength of this project. That is why it will succeed."

He said that while Middlehaven will not be in the same international league as Chicago, "it could be knocking on the door".

Joe Docherty, chief executive of Tees Valley Regeneration, said: "Middlehaven will be the spark which lights the touch paper for the regeneration of the whole of the Tees Valley - a physical transformation and a personality change - heralding a new era.

"Middlehaven will become a vibrant centre of excellence for the way life should be lived in the 21st Century.

"Doing something not radically different with this site, just would not work."

One NorthEast's Alastair Haworth said the public money being spent on clearing and preparing the site, and putting in the infrastructure will act as a catalyst, levering in private-sector money.

Tees Valley Regeneration has been speaking to 17 developers, some of national and international standing, about the project, since last autumn, it was revealed yesterday.

The national regeneration agency English Partnerships is a key partner in the project.

Regional director Neil Bradbury said: "English Partnerships has already invested £18m into this exciting project - in site clearance and ground preparation. This impressive master plan represents the next critical step in making Middlehaven a reality.''

The project will be accomplished in three phases.

Bob Cuffe, chairman of the Teesside Chamber of Commerce, said: "This development will bring world attention to Middlesbrough and catapult it towards the top of the list of places to be seen doing business."

A major consultation exercise began yesterday, marking an end to years of false starts, promises, disappointments and squabbling over the Middlehaven site.

Mr Mallon said the plan was a shared vision and would succeed