Argos plans to create 700 jobs in the North-East by building a massive distribution centre at a new business park.

The retailer has applied for permission for a 740,000 sq ft development at Faverdale East Business Park in Darlington.

If approved, the centre will be used for Argos' home delivery business, Argos Direct, and will create jobs in office administration, IT support, warehousing, driving and maintenance.

The news was hailed last night as a huge boost for the region as well as Darlington, which has suffered big job losses in the past year at Cleveland Bridge and the former Rothmans factory.

Darlington council leader John Williams said: "This is fantastic news. It confirms our belief that Darlington is one of the leading development areas because of its location, workforce, and the facilities it can offer to potential developers.

"Argos is one of the top retailers in the UK and we are delighted to receive their application for what could prove to be one of the most significant job boosts for the town in recent years."

The proposed development, near the A1M, would include a 550-space staff car park, 166 lorry spaces and room for 26 trailers.

The building would comprise a 676,000 sq ft warehouse plus offices and a despatch unit.

Outline planning permission was given last November for Faverdale East Business Park.

The council aimed to develop it in two phases, with the hope of creating 1,500 jobs in total, 880 of them in the first decade.

The council is still looking for a developer for phase one.

The part of the site which Argos is interested in was not expected to be developed until phase two, in ten years time. However, if the catalogue company wins planning permission it is expected to go ahead as soon as possible, meaning phase two could be finished before phase one.

Darlington MP Alan Milburn said: "These jobs are much needed in Darlington, especially after the job losses the town has recently suffered."

Margaret Fay, chairwoman of regional development agency One NorthEast, said: "In a recent survey we forecast a strong demand for quality industrial space in Darlington and this has influenced our on-going investment in the town.

"It is good to see this investment is paying off at sites like Faverdale, with the application for this new business and the possibility of significant jobs.

"One NorthEast is working with partners to develop Darlington as a gateway to the wider Tees Valley and establishing the town as a key strategic location for enterprise and industry. This early success for Faverdale is evidence of this really starting to happen."

John Leer, Tees Valley Regeneration's strategic investment manager, said the scale of the Argos development would have a major impact in the Tees Valley.

"It is a very clear example of the overall strength of Darlington, both as a business location and as the natural and economic gateway to the Tees Valley and the North-East," he said.

An Argos spokeswoman said it was too early to discuss the proposals in depth.

"The proposed development would support the strategic growth of our home delivery business," she said.

"While we confirm we have been in detailed discussions with Darlington Borough Council regarding our application, we would prefer to make no further comment until planning consent has been received."

A decision is likely to be made before the end of June.