UP to 200 new homes could be built on the site of a recycling depot in Banbury town centre within the next few years.

Waste management company Grundon Ltd is planning to move its base in Merton Street to nearby Thorpe Mead, off Thorpe Way, by the end of 2017.

In its place they are aiming to build a new housing development, including green spaces and pedestrian walkways.

The company has been based in Merton Street, next to the railway line, for about 30 years.

The existing three-hectare site includes waste collection, transfer and the treatment of recycling.

Grundon spokeswoman Ruth Rolls said the building project was an "exciting" step for the company.

She added: "It is really important in a small country such as ours to make as much use of land like this that we can.

"Who knows what this site could be in the future, but at the moment our plans are very exciting.

"The site has good access to the train station and the town centre, and there will also be sufficient open spaces within the plan."

Matt Taylor, of Berkshire-based architects JSA, said: "We have held extensive pre-application discussions with the council, as we seek to bring forward proposals that would complete the regeneration of this eastern area of Banbury.

"The company is based around sustainability, and recovering, re-using and recycling what other people throw away.

"So it seems very appropriate to extend that principle into reusing land as well."

The Merton Street site was earmarked for building development by Cherwell District Council as part of its Local Plan for development, which was published in July last year.

The plan outlines the building projects for the district up until 2031.

A masterplan for Banbury, which outlines development sites in the town, was approved by councillors for six weeks of public consultation at the start of January.

A planning application for the Merton Street site is expected to be submitted by the end of the month.

It will then be available on cherwell.gov.uk for members of the public to make comments.