A York furniture manufacturer has bought a former Norwich Union Life data centre in Dunnington for £1.325 million, sparking applause from the business community.

Eborcraft furniture makers, of Huntington, will move into the 28,000sq ft site at Chessingham Business Park as soon as it is transformed into a manufacturing unit, some time next year.

The firm, one of the oldest manufacturers in York, was established 110 years ago, and has been building bespoke natural wood veneer furniture ever since, concentrating largely on the office market.

The new building will have to accommodate Eborcraft's state-of-the-art cutting, drilling, assembly and finishing processes which have allowed it the flexibility of building anything from workstations to superior boardroom or reception furniture.

News of the purchase was hailed as "brilliant" by Len Cruddas, chief executive of the York and North Yorkshire Chamber of Commerce.

He said: "It's really bucking the trend, given that so many manufacturers have been battling against the cheaper labour rates of Third World countries.

"Even Dyson, that champion of Britishness, moved to the Far East last year. In order to compete we rely on our skill to provide high added value and if a local organisation invests to that extent in staying local, it means they are happy to rely on their high skills base in order to compete. Eborcraft came into existence a year before the formation of the chamber, and it is comforting to know that one of our most established industries is planning for the future with such confidence."

The Dunnington data centre was first built by General Accident, the insurance company's pre-merger predecessor in 1992, and was used by York-based Norwich Union Life mostly for database storage until this year when its data centres were consolidated in Norwich.

It includes an industrial warehouse and is on 3.3 acres. It was sold by agents CB Richard Ellis, acting for Morley Fund Management, Norwich Union's investment managers.

Chris Williams, managing director of Eborcraft, said he was planning to let his business contacts know before commenting.

Updated: 09:14 Tuesday, October 11, 2005