A new jobs bonanza is on the cards at Chichester which has already been chosen for the new headquarters of Rolls Royce.

Experts say that up to 2,000 jobs could be created when redundant NHS land is redeveloped.

A package of proposals approved by the district council will involve converting hospital buildings into offices and industrial units.

The scheme will take place in the grounds of the giant Graylingwell Psychiatric Hospital which was originally built as a workhouse in Victorian times.

The development will create millions of pounds to finance major improvements to mental health care services in the district by building modern new units and day hospitals.

Around 300 new homes will also be built as part of the package but thousands of trees on the site are to be kept and there will also be large areas of open spaces.

Martin Barnes, economical development manager for Chichester, said today: "We are not sure of the final figures but it will be a very substantial number of new jobs and a very important boost to the local economy."

Experts predict more firms will be keen to move to Chichester after the German owners of Rolls Royce chose a site at nearby Goodwood as the new headquarters for the world famous car company.

BMW is expected to apply within weeks for planning permission to build £200 million production centre and administrative offices as part of a scheme that will create 300 jobs.