The next stage of a long-awaited project to build a replacement children's hospital for Brighton is under way.

Health bosses have put out an advert inviting developers to express an interest in the site in the grounds of the Royal Sussex County Hospital in Brighton.

The development, which will cost in the region of £30 million, will replace the Royal Alexandra Hospital for Sick Children in Dyke Road, Brighton.

The scheme is being paid for through a government private finance initiative.

A private company will design, build and finance the development while Brighton and Sussex University Hospitals NHS Trust will provide the hospital's services and facilities.

Work on the hospital is expected to start in 2004 and the first patients are due to move in in 2007.

The renal unit at the Royal Sussex will be demolished to make way for the development. A new unit is being built on the top floors of the hospital's multi-storey car park.

The advert has been placed in the Official Journal of the European Community and interested companies have until August 26 to respond.

A shortlist of four developers will be drawn up and companies invited to make presentations before a final decision is made in the New Year.

The Royal Alex is based in crumbling Victorian buildings, which experts say have become untenable. It would cost tens of thousands of pounds a year to keep them up to a basic standard.

Moving to the Royal Sussex site will mean Royal Alex staff will be closer to facilities, including MRI and CT scanners and the pathology lab.

A trust spokesman said: "It will be a cutting-edge facility that will open a new chapter in children's care across Sussex."

The scheme was approved in principle by Health Secretary Alan Milburn in 2001 and given full permission to go ahead in February this year.

About 10,00 outpatients and more than 5,000 are treated at the Royal Alex every year.