THE Camelot theme park is to close and be replaced by 1,000 homes.

Prime Resorts, which owns the theme park at Charnock Richard, near Chorley, said the attraction was expected to remain open for another seven to 10 years.

But after that a new village will go up on the site, with 1,000 homes, a school, pub and health and fitness facilities.

Camelot is set in 140 acres of Lancashire countryside, and is one of the North West's biggest theme parks attracting hundreds of thousands of visitors each year.

But chief executive Roy Page said the theme park, which was built more than 20 years ago, was finding it increasingly difficult to meet the aspirations of younger people.

The theme park voted Lancashire Family Attraction Of The Year 2002 by the Good Britain Guide opened in 1984. The Granada group bought the company in February, 1986.

Following a management buyout in June 1998, it passed to Prime Resorts Limited, which owns the theme park and the Park Hall Hotel leisure and conference centre.

Mr Page said: "We are a small site. We cannot build the huge £10m to £12m rides."

The company made an unsuccessful planning application for houses at the site in 2004. It was rejected by Chorley Council, which said there was no evidence of a need for houses in the area.

But according to planning consultant Nick Laister, the climate has now changed.

"The government has decided that house building in the North-west has to increase considerably," he said. "They are currently proposing an annual increase of 68 per cent in the amount of houses built."