Manchester City Council has announced it is in the early stages of discussions with both the Royal Opera House and the Royal Ballet about setting up a “production, training and performance base” at Manchester’s Palace Theatre.

The announcement follows months of speculation that the two Covent Garden-based cultural powerhouses have been seeking a base up north. Tony Hall, chief executive of the Royal Opera House since 2001, said he was “delighted” at the proposition of joining up with the Palace Theatre, calling the venue an “iconic building” in the “perfect location for developing our relationship with cultural and educational centres in the city”.

Also reacting today, Sir Howard Bernstein, chief executive of Manchester city council, called the move a “compelling proposition”, adding that the collaboration would be “fantastic for Manchester”, further enhancing its “strong cultural offer”. Bernstein also highlighted the economic benefits to the city, with the potential increase in tourism and creation of local jobs.

The Palace, located on Manchester’s Oxford Street, has a capacity of almost 2,000 and was built the late 19th century. It currently operates as a receiving house, and has in recent years hosted extended runs of shows including Mary Poppins, The Producers, Les Miserables and Chitty Chitty Bang Bang. Next year it plays host to the regional premiere of Queen musical We Will Rock You, which stays for a three-month residency prior to a national tour (See News, 9 Sep 2008).