HALF a million pounds of public cash will be put into a private scheme to transform a derelict foundry in Burnley into a hotel and nightclub complex, councillors have been told.

Work is expected to start next month on massive improvements to the listed town centre Proctor's Mill, also creating a pub, restaurant, recording studios and a penthouse flat.

The scheme, headed by former Burnley nightclub boss Michael Cookson, could be complete by the end of the year, Burnley's finance committee was told.

A report to members shows the project will attract European Fund, English Heritage and Challenge Fund grants - with the allocation raised from £350,000 to £500,000 to ensure the scheme is economically viable.

The Hammerton Street building, branded Burnley centre's biggest eyesore, has been in a near derelict state for years.

Council bosses have tried to help find a developer without success for several years.

They believe the hotel development would not only solve the problem, but also provide Burnley with a much-needed facility to attract more visitors to the town.

Mr Cookson formerly ran Panama Joe's nightspot - now Genesis - just across the road in Hammerton Street, but left after the complex, including Mean Cat Daddies - was sold to the Northern Leisure Group in 1997 for a reported £1.5 million.

He later took over the Berkley restaurant and banqueting suite in Accrington.

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