Caterham Cars, the iconic brand that has been in Caterham since its creation in 1957, is leaving town.

The showroom has to relocate by the end of February to make way for a development of 35 sheltered flats and a limited number of retail units.

In December Tandridge District Council turned down a planning application by Churchill Retirement Homes to build the new flats and shops. However, last month the Planning Inspectorate upheld Churchill's appeal and gave the go-ahead for the development.

The site is being sold to Churchill Retirement Homes by Simon Nearn, the son of the late Graham Nearn who founded Caterham Cars.

The Nearn family sold the business in 2005 but ownership of the land where the showroom and workshop is located passed to Simon Nearn who now lives in Australia.

Before it relocates to a much larger facility not far from Caterham, the showroom will move into a temporary home, details of which will be announced in due course.

Graham Macdonald, Chief Executive of Caterham Cars, said: "It is with great sadness and regret that Caterham Cars will leave its spiritual home. It is not a decision that the company wanted to take but, rather, one in which its hands have been tied.

"Our brand proudly takes its very name from the town in which it was founded by the Nearn family and it is particularly poignant that, just as Caterham Cars begins an exciting new chapter in its history, it is moving away.

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"I would like to thank the town of Caterham and its residents for their unstinting support over the last 56 years."

Last November Caterham Cars announced a joint venture with Renault to develop and build Caterham's first brand new road model for 17 years and revive Renault's historic Alpine badge.

Following the decision by the Planning Inspectorate ,Andrew Burgess of Churchill Retirement Homes said: "We are clearly delighted with the appeal decision and that the Inspector accepted all of our arguments and found that there were no concerns regarding loss of employment land and that there was not an unacceptable concentration of accommodation for the elderly. This is a convincing win for Churchill Retirement Living.

We will be starting construction as soon as possible and the development will be completed by May 2014."

Surrey County Councillor for Caterham Valley, Sally Marks, was not so delighted with the decision. She said: "I feel the decision by the Planning Inspectorate was outrageous. It is another example of unelected bodies thinking they know better than local people.

Why is it right for old people to be dumped by the railway line? It flies in the face of 'localism' and I think it is really sad."

To view the Inspector's full report go to www.caterham- independent.co.uk and click on the link on the home page to 'Churchill Retirement Homes appeal decision".