It could be a piece of prime real estate - and developers with a vision of a luxury apartment block are already eyeing it up.

The site of the Royal Alexandra Hospital for Sick Children in Brighton would be worth millions if allowed to be converted into flats when the facility moves to the Royal Sussex County Hospital in Brighton in 2007.

Currrently two-bedroom flats in some parts of Brighton and Hove are selling for between £250,000 and £300,000.

If developers built just 20 flats on the Dyke Road site in three years' time they could be looking at a return of about £6 million.

However health managers say simply handing the site over to developers to create expensive homes is unlikely to allowed by Brighton and Hove City Council planners.

The council already has a rule that 40 per cent of any residential development should be affordable housing.

There is also a Government move to push for former hospital and NHS buildings to continue to provide health services or facilities which benefit the community.

The Royal Alex is being replaced with a £36 million hospital unit at the Royal Sussex which will be paid for through a Government Private Finance Initiative. Some of the hospital buildings are more than 100 years old and not suitable for modern health services.

Although most people agree the Royal Alex needs to move on, many are still fond of the building itself and are likely to be unhappy at the idea of it being pulled down for flats.

A hospital spokesman said: "In the past whenever a sizeable piece of land becomes available, planning restraints only allow it to be used for a benefit to the community - either by continuing to have health services of some kind or another possible use, such as social housing only.

"Any money raised from the sale of the site will be ploughed back into hospital and health services locally."

Phil Graves, from Graves Jenkins Estate Agents in Brighton, said: "It is in an absolutely prime site.

"Not only is it close to the main shops and bars and clubs but it is also close to the station. If the site is converted into flats then it could bring in a lot of people who are interested in moving to the city or young professionals who are looking for a place."

The planning application for development at the Royal Sussex will go before city councillors on Wednesday.

Thursday January 08, 2004