Plans for the development of a new £80m entertainment venue in Leeds, South Yorkshire, have been conditionally approved by the local authority.

Leeds City Council's (LCC) plans panel has backed the proposed 13,500-capacity Leeds Arena, which will be developed on a site in Claypit Lane and will be operated by SMG Europe. 'Super theatre' plans for the new venue will ensure that the furthest seat will be no more than 68m (223ft) from the centre of the stage - compared with 90-95m (295-312ft) at most conventional arenas.

LCC leader Andrew Carter said: "Being granted outline planning permission provides the council with a strong platform to finalise the arena design. "We will soon be in a position to announce the preferred contractor to build the arena and are now well on target for construction to start by the end of the year."

Regional development agency Yorkshire Forward has agreed to commit £10m towards the scheme, which has met with opposition from neighbouring city Sheffield. Sheffield International Venues (SIV), which operates the Sheffield Arena, has expressed concerns that the new Leeds venue could threaten the long-term viability of its neighbouring counterpart.

SIV chief executive Steve Brailey said: "Right from the beginning, we have held the view that an arena development in Leeds would result in significant damage to business in Sheffield and create a worrying challenge for both cities. "It would seem unwise for a local authority to be investing so much money in an arena at a time when public services are under threat."