Work has started on a £100m project which could create thousands of jobs and establish the North-East as a global centre of excellence in developing new products.

Knowledge Campus will bring together companies at the cutting edge of the product development industry to form a community of innovative firms, all on a purpose-built, 51-acre site overlooking the River Tyne at Gateshead.

Scheduled for occupation in September next year, the project is a joint venture between engineering and design company Express Group, regional development agency One NorthEast and Gateshead Borough Council.

The partnership, the first of its kind in the UK, also hopes to involve the universities and colleges in the North-East.

Knowledge Campus aims to make new product development a faster and less expensive process.

New product development is a major global market, with Department of Trade and Industry (DTI) statistics showing the top 300 Research and Development investing international companies spent a total of £57bn in 1999.

The DTI says research and development (R&D) is one of the most important investments in the future that a company can make.

Knowledge Campus tenants will cover the full spectrum of new product development - including the world's major manufacturers, as well as industrial designers, engineers, toolmakers, lawyers, patent agents and firms providing rapid prototyping, IT, multimedia and marketing.

These companies will be supported by a advanced information and communication technology that will enable everyone involved in the process of developing new products to work together in real time, wherever they are in the world.

This will create a virtual new product development community connected by powerful online technology, as well as a physical community based at the Knowledge Campus site.

Chris Thompson, chairman of Express Group and Knowledge Campus said: "New product development is the single most important competitive challenge today.

"There is tremendous pressure to accelerate the process of bringing new products to market to exploit emerging technologies and to reduce costs at the same time."

The benefits to the region from Knowledge Campus would be tremendous.

"It will create the opportunity for thousands of high quality jobs, directly and indirectly, through generating business opportunities for local companies.

"Knowledge Campus will help manufacturers accelerate the new product development process through smart use of collaborative software and Internet technology.

"Design and development acts as a job multiplier. Every one job at the ideas level of new product development can generate up to 1,000 in manufacturing."

Neil Mundy, director of integration at One NorthEast-said: "Knowledge Campus is a hugely significant project - a true example of businesses thinking globally, not just regionally.

"It has the potential to be of substantial benefit to the region's economy."

When complete, as well as being a regional centre, the Knowledge Campus development will form the commercial heart of the Gateshead Quays area, which will feature cultural attractions such as the Norman Foster-designed Music Centre Gateshead and the Baltic Centre for Contemporary Art.

Councillor George Gill, the leader of Gateshead council, said: "This is a groundbreaking and exciting project that will benefit the whole region.

"Through Knowledge Campus, we are set to attract world-class, cutting edge companies, creating high quality, highly skilled, with paid jobs for local people.

"The site, close to Gateshead Quays, will be an important factor for the success of the project.

"With over £500m being spent to redevelop the Gateshead Quays and East Gateshead areas, Knowledge Campus will be able to sit proudly amongst those massive cultural, business and leisure developments.