A York construction company is to be the first in the country to build a ready-made five-storey block of flats within its factory walls.

Yorkon, a subsidiary of the Shepherd building company, was picked for the pioneering £2.25 million scheme by a housing association in London.

The company will construct the flats at its factory in Huntington before they are transported by lorry to Hackney, east London

Andy Atkins, the company's marketing manager, said a lot of people, from the Government down, were very interested in the project and that it could revolutionise the British house-building industry.

"This is a prestigious project for Yorkon and it's going to raise the profile of the company nationwide," he said.

"It reflects a considerable amount of effort and hard work from everybody within the organisation."

The Peabody Trust, the oldest housing association in London, ran a competition among progressive architects to design a five-storey apartment block for the half-acre site in Hackney.

The winning design is now being turned into ready-to-use living rooms, bedrooms, bathrooms and kitchens in the Yorkon plant.

They are being constructed in module form, each measuring 8m by 3.2m and three metres high.

By March, the first of 74 modules, pre-decorated and complete with high-specification features, will be transported to the capital to be bolted to the foundations.

The 32 one and two bedroom apartments will then be clad in terracotta tiles and cedarwood.

Private balconies, a walkway, lift and stairs tower will be built on, and the first tenants are due to arrive in July - months ahead of the usual time scale.

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