Eatonfield Group, the Cheshire-based development company, has been given the green light to transform a former NHS hospital in Lesmahagow, South Lanarkshire, into a country house hotel.

South Lanarkshire Council has approved plans for the redevelopment of the 83-acre (33.6) Birkwood site, which was acquired by the company in June 2008. The site has been unoccupied since 2002.

The Grade B-listed hospital building will be renovated into a new country house hotel as part of the scheme, which also includes 165 new houses and the potential construction of new play and sports facilities in partnership with the Lesmahagow Community Council.

Rob Lloyd, Eatonfield Group chief executive, said: "It further emphasises our ability to work closely with local government in achieving planning permission for a development which not only preserves the high-quality landscape, but which will also provide opportunities for this unique village."

In April, the company was also given the go-ahead for the redevelopment of a former steelworks in Workington, Cumbria, which will include a hotel, a pub and leisure facilities, as well as 400m promenade, a retirement village, 650 new homes and office facilities.