The Lancaster Property Network (LPN) development, named Lawson's Quay, would be built on land between Caton Road and Bulk Road and include a 120-bedroom three-plus-star hotel, offices and multi-storey car park.

There are also plans for shops beneath the hotel and offices.

The proposals, submitted to the city council this week, form phase one of a £125million scheme which would transform the wider site.

LPN owner, John Sanderson said: "We've spent an enormous amount of time and effort making sure we put a proposal forward that matches the needs and requirements of Lancaster.

"We've spent a lot of time listening to what local people and business owners want to see and we're very confident that this scheme reflects that."

Advanced discussions are currently taking place with a major hotel operator for the site.

David Taylor of Irvine Taylor, the chartered surveyors promoting the scheme, said the plans were promising news in the face of a
difficult financial climate. The submission of this application is encouraging as it reflects LPN's confidence in the future of the district," he said.

"It also demonstrates LPN's confidence that having reduced its activity in the housing market before the current slump, the company now has the resources to speculate in the commercial market and invest in Lancaster.

"For Lancaster it is significant in that this investment will improve the approach to the city centre and by introducing a quality 'landmark' hotel and a complex of modern offices, it will enhance Lancaster's role as the focal point of North Lancashire and South Cumbria."

Phase two of the Lawson's Quay development will include land currently occupied by businesses including the Sunlight laundry and Farmfoods. Discussions are ongoing about developing those sites as apartments, shops and offices.

The new scheme would sit alongside the retail park and the controversial eight-storey block of flats on the Kingsway site.

LPN also has planning permission for office accommodation called Gateway House next to the proposed development.

This was put on hold until plans for the whole site were worked up.