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The main Royal Shakespeare Theatre is to be torn down and replaced by a 1050-seat theatre and an extension will be grafted onto the smaller Other Place theatre, providing an additional 650 seats. The Swan Theatre will also undergo a refurbishment and extension to its backstage facilities.

The present building on the Union Club site will be refurbished to become a teaching centre.

The proposals will now be taken through the design stage by architect Erick van Egeraat and theatre consultant Iain Mackintosh. The initial designs should be completed by summer 2002.

The Arts Council has pledged £50m towards the project with the rest to be raised by the RSC.

The project is likely to be completed by 2008.

The feasibility study, leading up to yesterday's announcement about the future of Stratford, was led by van Egeraat and Michael Rushe.

The rest of the team, appointed in December last year to work on the redevelopment of the 14 acre theatre complex, includes QS Gardiner & Theobald and conservation consultant Alan Baxter & Associates.

As well as the main building work, the project will include improvements to indoor and outdoor public spaces within the theatre village, improved catering and bars, more retail space, hospitality and meeting areas, an RSC nursery, more RSC residential accommodation within and outside the village and a long-term refurbishment programme for the Arden Hotel.

Earlier proposals for the main theatre, which were among 14 plans considered for the complex, had included knocking down the hotel.