Listed property management group Ely is to lead a €60 million tax break-based investment in developing a network of creches around the State.

Ely said yesterday that it had agreed a joint venture with UK-based Creative Education to build 25 creches under the British company's Primary Steps brand.

Under the Finance Act 2000, investment in childcare facilities is eligible for a tax break. Ely will raise cash from individual taxpayers who want to take part in the project. The investment required for each creche will be €2 million-€2.5 million, meaning that the total outlay will be €50 million-€62.5 million.

The tax incentive is similar to those available for film, private healthcare and some property developments. It allows individuals paying 42 per cent PAYE to offset their investment against their tax liabilities.

It was designed to stimulate investment in childcare facilities in the Republic, where demand for nursery and creche facilities has been growing strongly over the past decade.

Ely chief executive Philip Marley said yesterday that the two companies would build creches in schools, workplaces and residential areas.

"We believe Creative Education's individualised, small unit approach to creches is right for the Irish market," he said.

The creches themselves will be about 280sq m (3014sq ft) each. The companies are evaluating potential sites for the development in the Republic. Creative Education began trading in 2000 and is the UK's 10th biggest nursery company, with 35 creches offering a total of 1,937 places for children. It is listed on London's Alternative Investment Market (Aim).

According to its chief executive, David Alexander, its Irish venture will play a key role in meeting the company's target of operating a total of 70 creches in three years.

Ely floated on Aim last month. Aim is designed for small, developing companies. Ely had profits of €968,000 in the year to the end of last October.