Work starts on Tuesday to build a new �50m headquarters for Newcastle computer group Sage.

The software giant will lay the foundations for its new group HQ at Newcastle Great Park, near the Gosforth area of the city.

It is expected the firm's 575,000 sq ft building, will be completed by December 2003.

The headquarters is hoped to provide jobs for 1,500 workers within two years.

'Excellent region'

Newcastle Great Park is one of two major employment sites on the outskirts of the city as part of the city council's Going for Growth regeneration strategy.

Sage chief executive Paul Walker said: "This represents a major milestone in Sage's history.

"It demonstrates our commitment to, and investment in, the North East as an excellent region in which to live and work."

Sage is the first business organisation to take up residence at the park, and it is hoped its presence will pave the way for other hi-tech companies to sign up to the development.

City council deputy leader Keith Taylor said the move represented a significant investment in the city.