PRINCESS Yachts has been granted permission to erect what may be Plymouth's biggest building, creating hundreds of jobs.

Councillors decided that the economic and regeneration advantages of the £45million development at South Yard in Devonport were sufficient to override objections by English Heritage.

At the heart of the complex will be a five-storey high, 300,000 sq ft production hanger for £10million superyachts.

Work on the first phase of the development, worth £15million, could now start this year.

Princess Yachts says the development will create 200 jobs initially and secure work for its existing staff of almost 2,000 in the city.

The planned complex includes an office block, 350-ton cranes and a covered waterside area at "shallow dock" to allow 50-metre boats to be worked on while afloat.

Princess Yachts is keeping all its existing sites in Plymouth, with the new site being used to enter the lucrative superyacht market.

English Heritage had raised objections to the proposal on the basis that the huge hangar was "out of character" with the historic South Yard, which Princess Yachts is hoping to acquire freehold from the MoD.

Princess Yachts' plans do not require the demolition of any of the South Yards historic buildings.

Planning permission was granted with legal conditions attached that will ensure the creation of 90 new apprenticeships, as well as funding for sustainable transport schemes.

Speaking after the planning committee's meeting at the Council House, Devonport councillor Bill Stevens said that the decision should be seen as a huge step forward.

He added: "I think sufficient protection has been put in place for the historic buildings.

"The combination of backing a huge employer continuing to choose Plymouth, and the preservation of historic buildings, is the right balance to take."

Mr Stevens said that people in Devonport were looking forward to the development, which would benefit the whole city.

A spokesman for English Heritage said that the organisation was "disappointed" at the decision, which would have 'an irreversible impact it will have on the rest of the historic South Yard'.

She added: "Once they are available, we will examine the council's planning conditions.

"We hope to work with Princess Yachts and the council as the scheme is further developed, in order to safeguard both the significance and setting of the surrounding dockyard heritage."