A business centre is set to be built on the site of the famous Castle Eden Brewery in Peterlee.

Beer production ceases on the site on December 31, when Castle Eden plans to transfer production to Cameron's Lion Brewery at Hartlepool.

The takeover is dependent on planning permission being granted to housing developer Persimmon for a proposed luxury homes scheme on most of the 14.6 acre Castle Eden site.

Earlier this week Easington district councillors granted conditional approval for 70 houses and ten flats in converted buildings at the 175-year-old brewery.

But it has been referred to the Government Office North-East for comment because the site lies in a conservation area.

Provided the proposals are not called in by the Secretary of State, which could result in a public inquiry, the brewery move should take place early in the New Year. Durham Associates, founded by managing director Mike Sands in 1981, supports the brewery move.

If the go-ahead is given the company has agreed to expand into more of the old brewery buildings and buy about one acre of land at the north-eastern corner of the site.

It plans to create a business centre employing between 70 and 100 people in modern office accommodation.

Director Dave Picken said any development would have to comply with the listed status of the brewery buildings.

"We occupy the old coach house, which was where the brewery founder, Mr Nimmo, lived in the 1820s. We plan to buy all the rest of the listed buildings on site which would require repair and renovation in sympathetic style. It will be a business centre with an emphasis on modern technology, specifically Internet-based operations."