The redevelopment will provide new walkways to the river

Debenhams is to take up the main site at the revamped Kingsway centre, bringing around 300 jobs to the city.

The redevelopment, which will incorporate the existing centre into a new, extended building, is expected to be completed by 2006.

The �100m scheme will include a food store, parking for nearly 1,400 cars, a hotel, residential accommodation and leisure facilities as well as 40 other shop units.

In March, Newport City Council gave the go-ahead for developers Rhys Newport Ltd to extend the centre by 500,000 sq ft.

Both the council and the Welsh Development Agency have backed the scheme, which is seen as central to efforts to boost the city's profile.

'Further enhancements'

Sir Harry Jones, leader of Newport council, said the council was delighted by Debenhams' announcement.

"We are determined to breath new life into the city centre and to attract new shops and shoppers to Newport.

"The council worked hard to bring this prestigious redevelopment scheme to Newport.

"Securing a major department store as part of the redevelopment is a huge boost to the scheme and to the city.

A spokeswoman for Rhys Newport Limited said: "We see this as a very exciting growth area in which to invest and expect there to be significant further enhancements to the city."

The medieval ship was discovered on the river banks

Last month, an urban regeneration company, Newport Unlimited, was created to co-ordinate a revamp of the city.

Newport has suffered from job losses in recent years, including the closure of the heavy steelworks at Llanwern in 2001.

However, a �750m housing development is now planned for the site, while a new arts centre is being built in the city centre.

It will eventually house the medieval ship uncovered during excavation work on the arts centre's foundations.

The city will also host the Ryder Cup golf tournament in 2010.