A NEW regional headquarters for rapidly-expanding Corus Rail Consultancy Ltd will be built on the site of a derelict city centre building in Toft Green, York - and it could mean 30 new jobs.

Demolition work is about to begin on the premises which used to be Cramptons Auction Rooms and more recently housed the ill-fated Russells Cycles to make way for a modern £1.5 million four-storey block. Building is due to be completed by next May.

The prospect has been hailed as "good news" by Tony Bennett, York's assistant director of economic development. who described the new HQ as "a commitment to York as a centre of excellence for the rail industry."

York developer Northminster Properties, which acquired the building last year, has already agreed terms with space-hungry Corus Rail Consultancy which plans to continue occupying five floors at nearby Hudson House

The firm, which in the wake of the demand for railway investment, has grown by 50 per cent over the past 12 months, will take over the entire 7,200 sq ft on a 15 year lease at a prime town centre rental of more than £102,600 per year - exceeding even existing top levels of about £14.25 per sq ft.

Of the 345 people employed by Corus Rail Consultancy which also has offices in London, Birmingham, Manchester and Dublin, as many as many as 300 are in York, although 50 have been moved into West Offices on a temporary lease next door to Hudson House. But the new premises will not only mean that for the first time Corus Rail Consultancy will have its own named building in the city, but with space for up to 700 workers there, further expansion will mean some 30 new jobs.

Hugh Fenwick, managing director, said that over the last 18 months York had to accommodate 30 more staff as his organisation tackled an increasing number of major contracts.

These include being principal consultants for the Sunderland Direct Project - the extension of the Tyne and Wear Metro system from Pelaw to Sunderland and South Hylton; a major project in the Republic of Ireland to provide extra tracks and infrastructure for extra trains from Dublin Heuston to Kildare; and the East Coast mainline update with other major projects from Railtrack.

"We are a major employer in York and don't have any front door. Hardly anyone knows we are in the city. Our new building will be emblazoned with our logo, so they'll know now."

The space was desperately needed particularly if his organisation was to build on its recent successes. Growth was likely to take an even greater spurt once the Government announced its promised ten-year plan - Transport 2010, he said.

Martin Burgess, managing director of Northminster Properties Ltd said: "I am particularly pleased with the encouragement we received from the city's planners to bring forward quality, modern architecture."