WHITBY Youth Hostel couldn't be better placed. Its cliff-top location on the Abbey headland, with stunning views over the town and coast, has always made it popular with visitors. Now plans to move to a new home are set to put the hostel into a class of its own.

The historic Abbey House, which lies just a few hundred yards from the existing hostel building, is being restored and transformed into a 100-bed Youth Hostel, thanks to a pledge of nearly £1.5m from the Heritage Lottery Fund.

Nestling in the shadow of Whitby Abbey, the house began life as the Abbott's lodgings and later became home to the wealthy Cholmley family, who acquired Whitby Abbey after its dissolution in 1538. Many of the Abbey buildings were demolished and the stone was used in the construction of what came to be known as Abbey House.

Important changes followed in the 17th century when an extension known as the Banqueting House was added, along with a decorative stone courtyard or "hard garden" inspired by Hugh Cholmley's visits to France and Spain. Made of cobbles, pebbles and stones collected from the seashore, the garden was discovered beneath a lawn in front of the house during excavations in 1997. It is now Grade II listed and recorded in the register of historic parks and gardens. The house itself is Grade I listed, as are the garden walls and gate piers.

Although the building suffered in later years, losing its roof to a storm in 1790 and having many windows walled up during the 19th century, a significant portion of it has already been reinstated. The Banqueting House is now a visitor centre housing archaeological material excavated at Whitby, as well as computer-generated images revealing how the headland has changed over time. The unblocked windows are covered with fine gauze window blinds to allow visitors views over the headland and Abbey whilst concealing the modem activities within and thereby preserving the look of the exterior.

It was not known how the restoration of the remainder of the building would be achieved until the Youth Hostel Association approached English Heritage (EH) with the idea several years ago. Says Simon Ainley, YHA Regional Manager for Yorkshire & the Humber: "We wanted to expand and the Abbey House seemed like an ideal location - larger but retaining the character of our existing accommodation. The building is of significant historical interest but is currently in serious need of repair.

"This project will preserve it whilst creating a sustainable business that will benefit the local community through extra jobs and increased numbers of visitors. It will have all the facilities a modern youth hostel needs to cater for a diverse range of visitors. It's not just backpackers any more. We have educational packages for school groups to come and study local history, family rooms, meeting rooms, and a cafe open to the public."

English Heritage, who maintain the Abbey and its surrounds, have earmarked £1.46m for the project. Ian Carstairs, Chair of the Heritage Lottery Fund's Committee for Yorkshire & the Humber, says: "The YHA has an excellent record of putting historic buildings to good use. As well as introducing new audiences to a wonderful building, this project would complete the regeneration of the Whitby Abbey Headland."

The Whitby Abbey Headland Project is a partnership between English Heritage, Scarborough Borough Council and the Strickland Estate, who own much of the land, including the Abbey House. With the help of funding from the European Regional Development Fund, this four-year project has sparked off huge changes to the layout and management of the headland. Says Sir Neil Cossons, chairman of English Heritage: "Whitby's headland is one of the most beautiful places in England, full of historic character and archaeological importance. Although enjoyed by almost a million visitors a year, its potential has been blighted by unsightly facilities, inadequate interpretation and intrusive traffic.

"The project has now transformed this dramatic corner of North Yorkshire. The site has been cleared of 20th century clutter, the natural landscape has been reinstated and a new visitor centre of world class standards has been provided. The ruinous appearance of Cholmley's house has been a significant part of the headland's history. Stanton Williams' innovative design has placed an elegant modern visitor centre in this roofless ruin, preserving its mystery and demonstrating how good modern architecture can enhance the historic environment."

Work is due to start on the new hostel early in the new and could take up to 18 months, seeing the doors open sometime in 2006. Until then the old hostel will stay open.

l Further information is available from English Heritage: 01904 601901, www.english-heritage.org.uk and the YHA: 0870 770 8868, www.yha.org.uk