A DEVELOPER has unveiled a £4m plan to restore a derelict Waterside hotel and transform it into a care home for the elderly.

Southampton-based Diamond Property Holdings (DPH) has bought the crumbling West Cliff Hall, Hythe, which has been wrecked by vandals and arsonists after standing empty for almost 20 years.

The company aims to create a 70-bed home by refurbishing the main building and replacing two demolished wings.

The ambitious scheme could form part of a £8m investment in the area. Local worshipers have submitted plans to demolish two churches at Hythe and Holbury and replace them with a new £4m RC church on land at the rear of West Cliff Hall. The New Forest National Park Authority is expected to discuss the care home plan in the next few weeks.

DPH boss Keith Diamond said: "These proposals offer an excellent opportunity to save an historic building, enhancing its position within the National Park and improving the outlook for local residents.

"Our research has shown there will be a 24 per cent increase in the over-85 age group in the New Forest by 2011. The proposed development would help meet current and future needs of those needing residential care."

West Cliff Hall used to be one of the finest hotels in the area.