SUPERMARKET giant Sainsbury's is planning to open a store as part of the proposed redevelopment of York's landmark White Swan Hotel.

The firm has submitted a licensing application to City of York Council to allow it to occupy a unit on the ground floor of the historic Piccadilly building, after plans to breathe new life into the site were revealed.

The upper floors of the former hotel, which have been empty for more than 30 years, will be turned into 18 flats if revised plans for the building are approved by the council. York has been awarded £450,000 in funding for the conversion following talks between the authority, the Graham Family Trust which owns the site, and the Fabrick Group, which runs affordable housing provider Tees Valley Housing Association.

The licensing application is seeking permission for the Sainsbury's Local store to open between 7am and 11pm every day and sell alcohol between 8am and 11pm. The chain already has a licence for a proposed new store at Queen's House, at the foot of Micklegate, while it has also secured permission for a new shopfront and cash machine at this building.

A Sainsbury's spokesman said: "The planning process is at a very early stage, but we're happy to confirm our involvement with the site and hope we'll be able to open a Sainsbury's Local at this key location."

Council leader James Alexander said today: “On the back of council investment in city-centre infrastructure, it is good to see private investment being proposed.

"Bringing more jobs to our city is a good thing and seeing the White Swan being brought back into use is even better. There is renewed confidence in our economy, and after two years of Labour leading the council we are starting to see progress on development sites that eluded the previous administration for eight.”

Planning agents for the White Swan's revamp have said in documents submitted to the council that a supermarket chain would have a "substantial retail presence" on the ground floor of the building. The flats would be made available as affordable housing for 15 years before becoming market housing.